Quote:However, you missed my point.
Ah, yes, I thought you meant it took him 30 minutes to derail it from income inequality to wealth inequality.
Quote:We have now reviewed all possible causes of the Great Divergence—all, at least, that have thus far attracted most experts' attention. What are their relative contributions? Here is a back-of-the-envelope calculation, an admittedly crude composite of my discussions with and reading of the various economists and political scientists cited thus far:
Race and gender are responsible for none of it, and single parenthood is responsible for virtually none of it.
Immigration is responsible for 5 percent.
The imagined uniqueness of computers as a transformative technology is responsible for none of it.
Tax policy is responsible for 5 percent.
The decline of labor is responsible for 20 percent.
Trade is responsible for 10 percent.
Wall Street and corporate boards' pampering of the Stinking Rich is responsible for 30 percent.
Various failures in our education system are responsible for 30 percent.
A failure common to this kind of attribution is that it does not address causes so much as correlations. For example, "the decline of labour" is not a sui generis event. It is the result of the weakening power of workers relative to employers, which is itself the result of other causes. When Bretton Woods collapsed, international capital flows resumed, and trade barriers started to fall, the modern multinational corporation gained an enormous quantity of bargaining power against labour. No longer tied to the labour pool of their home country, they now held the implicit threat of moving their production operations. This eviscerated the Unions' bargaining power, not only in collective negotiations, but also at the political level.
Once Unions were not strong enough to resist, they could be broken (see: Reagan, Ronald, Lady, The Iron, and Pinochet, Augusto.) The strongest unions today are the ones that are functionally immune to this process: public sector unions, who definitionally negotiate only with their home government, whose jobs can't be moved elsewhere.
So, what's responsible for that gain in inequality, then? The decline of unions? Or the causes that stand behind that decline?
Similarly, we can say that the pampering of Wall Street caused inequality, but why was Wall Street suddenly pampered? Was it a spontaneous political decision, the whims of Ronnie Raygun? Or were the political forces favouring that kind of pampering getting stronger, and the countervailing forces getting weaker, due to deeper changes in the relationship between workers, corporations, and the state?
Between those two causes, you have 50% of their attribution of the whole phenomenon, and yet, true though they may be, they don't seem to get at root causes.
-Jester