"Consider these stark facts.
Adjusted for inflation, the income of the average American male has essentially flatlined since the 1970s, according to figures from the Census Bureau. The income of the bottom quarter of U.S. families has actually fallen. It’s been a different story for the rich. According to recent work by Berkeley economist Emmanuel Saez, the share of total income going to the top 1 percent of families has more than doubled since 1979, from below 10 percent to a peak of nearly 24 percent in 2007. (It has since fallen, but not by much.) The share going to the super-rich—the top 0.01 percent—has risen by a factor of seven. Americans used to be proud of their country’s reputation as a meritocracy, where anyone could aspire to get to the top with the right combination of inspiration and perspiration. It’s no longer true. Social mobility has been sliding in the United States. A poor kid in America now has about the same chance of becoming a rich grown-up as in socially rigid England. It looks like Downton Abbey has come to downtown U.S.A. Left-of-center economists like Paul Krugman and Jeffrey Sachs explain this phenomenon with the following story. Financial deregulation by Ronald Reagan ushered in an era of rampant greed in finance; meanwhile, Republicans ruthlessly hacked back New Deal and Great Society social programs to finance tax cuts for their Wall Street cronies. To make their point, liberals point to European countries like Denmark, Sweden, and the Netherlands, where the rich have not been getting richer and social mobility remains high. Conclusion? America needs European-style policies like the ones listed by Krugman in a recent column: “more nutritional aid for low-income mothers-to-be and young children…[improved]?public schools…aid to low-income college students…[and] a universal health care system.” And how would that all be paid for? You guessed right: higher taxes on the rich."
