Inequality is harmful:
Rich Man’s Recovery, by Paul Krugman, Commentary, NY Times: A few days ago, The Times published a report on a society that is being undermined by extreme inequality. This society claims to reward the best and brightest... In practice, however, the children of the wealthy benefit from opportunities and connections unavailable to children of the middle and working classes. And ... the gap between the society’s meritocratic ideology and its increasingly oligarchic reality is having a deeply demoralizing effect.
The report illustrated in a nutshell why extreme inequality is destructive, why claims ring hollow that inequality of outcomes doesn’t matter as long as there is equality of opportunity. If the rich ... live in a different social and material universe, that fact in itself makes nonsense of any notion of equal opportunity.
By the way, which society are we talking about? The answer is: the Harvard Business School — an elite institution, but one that is now characterized by a sharp internal division between ordinary students and a sub-elite of students from wealthy families.
The point, of course, is that as the business school goes, so goes America, only even more so — a point driven home by the latest data on taxpayer incomes..., 95 percent of the gains from economic recovery since 2009 have gone to the famous 1 percent. ...
Basically, while the great majority of Americans are still living in a depressed economy, the rich have recovered just about all their losses and are powering ahead. ...
What’s driving these huge income gains at the top? There’s intense debate on that point,..., however, whatever is causing the growing concentration of income at the top, the effect of that concentration is to undermine all the values that define America. Year by year, we’re diverging from our ideals. Inherited privilege is crowding out equality of opportunity; the power of money is crowding out effective democracy.
So what can be done? For the moment, the kind of transformation that took place under the New Deal — a transformation that created a middle-class society, not just through government programs, but by greatly increasing workers’ bargaining power — seems politically out of reach. But that doesn’t mean we should give up on smaller steps, initiatives that do at least a bit to level the playing field..., for example,... universal prekindergarten education, paid for with a small tax surcharge on those with incomes over $500,000. ... For extreme inequality is still on the rise — and it’s poisoning our society.