Question: How can we recover if even the few jobs out there are so low paying? Income has not kept up since the mid-‘80s when so many people lost their jobs the first time. When spending was down, banks and [other] lenders developed leasing and bad mortgages to move items. I don’t understand how this country can move forward without addressing this. Can you explain?
Paul Solman: There are a lot of issues stuffed into your question. Let me try to unpack a few of them.
First, what you mean by “recover”? Do you mean: “How can again we be as rich as we used to be, compared to other people and places”? Or: “Compared to how rich we ourselves were in the past, irrespective of others”?
Let’s leave aside the question of whether ours is a FALSE prosperity, built on the energy from buried carbon whose burning and release into the atmosphere might destroy us. Or whether the other technologies on which we’ve built our wealth – ATOMIC energy; computer and biological technology – will similarly turn the tables on the species that developed them. Because if our technologies wind up dooming us, then we just THINK we’re richer. Or ARE richer, but just for a brief and unsustainable moment in history.
But if these threats somehow prove to be manageable, then there seems little question we’re richer today in absolute terms – as a COUNTRY — than we were, perhaps richer even than before the crisis started. Life expectancy has probably continued to inch up. Who knows what technological marvels are being hatched as I write this, and you read it.
But you don’t mean “recover” on average, or “recover” as a whole, do you? If Scrooge McDuck comes to your house for dinner, the average wealth at the table indubitably skyrockets, but what good does it do the rest of you?
Yours is really a question about income and wealth inequality, then, and not about “recovery” as traditionally defined. As to the answer, well, reasonable minds will differ.
Can a country live with greater inequality than we have in the United States right now? Well, some countries certainly do. Can a country prosper in such an environment? It remains to be seen.