The Instability of Inequality

Do you ever get that feeling that you know something is fundamentally wrong but you just can't fully put your finger on it, or express exactly what's bothering you? That's often my case.

So, when I read Nouriel Roubini's commentary, The Instability of Inequality, on Project Syndicate, I realized that what he says almost expresses how I feel about our economic turmoil and the Occupy Wall Street movement. As excerpted from this article, Roubini says -

Even before the Great Depression, Europe’s enlightened “bourgeois” classes recognized that, to avoid revolution, workers’ rights needed to be protected, wage and labor conditions improved, and a welfare state created to redistribute wealth and finance public goods – education, health care, and a social safety net. The push towards a modern welfare state accelerated after the Great Depression, when the state took on the responsibility for macroeconomic stabilization – a role that required the maintenance of a large middle class by widening the provision of public goods through progressive taxation of incomes and wealth and fostering economic opportunity for all.

When you read the full article, you'll see that Roubini is a very intelligent economist whose insights cut right to the point. He's pointed out the specific problems, and I'm sure he's also prepared an economic model designed to address those problems (for a fee of course).

But, as often happens, ivory tower solutions are often based upon altruistic ideals. We tend to think that people who are elected, appointed, or otherwise paid to address these situations will always act on behalf of Americans as a whole, instead of acting upon their own personal agendas.

To me, that's the crux of the problem. America was already operating on a great economic model that was created from the ashes of The Great Depression. We didn't need to create a new model to replace it, what we needed was enforcement of our old model. All economic models will fail if the rules of those models aren't enforced.

And there's the rub. How do you create a functioning economic model when the people running the show don't want it? The people in charge of enforcing our previously functioning economic model weren't altruistic. They pursued their own individual agendas instead of watching out for our country collectively, and allowed that model to become "legally" corrupted in order to serve their own needs.

And, what's sad to me is that I don't believe that there are enough altruistic people left to change the status quo. I think many Americans have already lost faith in our leaders to do what's best for the country, regardless of their political affiliations. Personally, I don't see things changing anytime soon.

I mean, even the man who was elected on the basis of hope and change seems to be pursuing his own individual agenda. But, don't take my word for it, see for yourself -