How to Create Policies to Address Income Inequality? De-Mythologize Upward Mobility

inequality

 

Rather than asking individuals to increase their value, we need to transform how we as a society value the work individuals do.

Recently when President Obama admonished corporate CEOs to stop complaining about regulations, he roused a sharp retort from the corporate world, accusing him of “not getting it” and not doing enough to remove uncertainties caused by regulations that discourage companies from hiring. While his remarks were arguably nothing more than a gentle yet scolding reminder that corporations have fared quite well coming out of the recession in comparison to the proverbial “ordinary people” of main street, the intensity of corporate blowback underscores just how difficult any political struggle will be to orchestrate meaningful redistribution of resources to address the wealth gap, whether it be through governmental efforts to raise the minimum wage or labor actions such as those in recent months by fast food workers around the nation.

Nonetheless, this tart exchange, an episode of verbal sparring in the arena of class struggle, represents another installment in the unfolding conversation about “income inequality” (a euphemism for class inequality, but “class” is a Voldemort concept that shall not be named in American political discourse, except when invoking the phantom “middle class”). This topic promises to have staying power as it continues to find the center of national debate.

Indeed, while in his 2012 book The Price of Inequality, Nobel Prize-winning economist Joseph Stiglitz compellingly spelled out the dangers of class division, or income inequality, for a democratic society, the issue seems finally to be gaining political traction beyond serving as a wedge issue for upcoming elections. While the vigor of Occupy Movements that in part inspired Stiglitz’s book has waned, the issue has not.

As if on cue, in the midst of the verbal class struggle between Obama and corporate America, the ratings agency Standard and Poor’s issued a report claiming the increasing wealth gap has negatively impacted economic growth and slowed recovery from the Great Recession. The report argues this gap makes the economy more vulnerable to a boom-bust cycle and slows growth, causing S&P to cut its growth estimates for the economy because of the increasing concentration of wealth among the notorious one percent. Certainly, by no measure is S&P a progressive or left-leaning organization linked to Obama’s supposed socialist agenda.

Neither is the U.S. Conference of Mayors, which recently issued a report asserting that while the 8.7 million jobs lost in the recession have been regained, the average wage has dropped 23 percent. The report also calls the growing income inequality and wage gap “alarming.”

So, it seems that even corporate America might begin to recognize that its own interests lie in fostering a healthy economy, which means addressing income inequality.

The solutions so often proposed to countervail income inequality, however, are stale, ineffective, and counter-intuitive if one stops to think for two seconds, invoking the ever-popular and indeed mythical narratives of upward mobility and advancement through education that, quite simply, fail to grasp the reality of how our socio-economic system actually works and promote a blindness to the conditions that cause growing wage inequality.

For example, while the Standard and Poor’s study cites spurring educational achievement as a way to narrow the wealth gap and points out that a higher level of education typically translates into a higher wage, this recycled truism does not recognize that regardless of people’s educational level, as a collective we as a society still need certain work done. We need the cabbages picked, buildings cleaned, products assembled, children taught. Even if everybody in the U.S. earned advanced degrees, we still need people to do the necessary work that makes our lives possible, which includes the vital work that gets done by those working in low-wage jobs.

Thus, the narrative of upward mobility that hails escape from low-wage work through education might work for some on an individual level, but it doesn’t work on a social level; that is, individuals might escape low-wage work, but those jobs will still need to be done by and for society as a whole. Indeed, our beloved narrative of upward mobility merely legitimates low-wage work and economic inequality rather than addressing wage inequality systemically.

Additionally, promoting education as a solution to wage gaps fails to recognize the real pressure on wages, namely the drive to increase corporate profits in the private sector and diminishing state budgets in the public sector, which are each exacerbated by the decline in union membership, meaning workers have less power to advocate not just for higher wages but just to maintain wages. Indeed, educational achievement will do little to address the reality of stagnation and decline in real wages for average workers since the 1970s, the result of the proletarianization of many occupations and professions.

Asking people to do more, such as attaining more education, to alleviate the wealth gap is not the answer. We actually need to address wages directly. A substantial increase in the minimum wage is a place to start and promises to benefit all. First, while functioning as a kind of tax on business, the monies go directly to the workers such that their lives will be improved; they will pay more taxes providing governments with more revenues to fund education, infrastructure improvements, healthcare, and so on, which benefits the economy as a whole; and consumer spending which accounts for 2/3 of our economy will be boosted, helping businesses improve their bottom line.

While a more educated population furthers democratic society and is absolutely desirable, it is wrongheaded to see education as a solution for wage gaps. Put most simply, raising wages—or, more appropriately, moving toward equalizing wages–is the solution to wage gaps. Rather than asking individuals to increase their value, we need to transform how we as a society value the work individuals do and how we remunerate the vital contributions of workers, especially those in low-wage jobs, which make our collective lives possible. This step requires disencumbering ourselves from the hackneyed cultural narratives of individual upward mobility that disarm our thinking and prevent us from engaging in a thoroughgoing re-assessment of our values and of the meaning of meritocracy as we re-think who merits a decent wage.



Tim Libretti is a professor of U.S. literature and culture at a state university in Chicago. A long-time progressive voice, he has published many academic and journalistic articles on culture, class, race, gender, and politics, for which he has received awards from the Working Class Studies Association, the International Labor Communications Association, the National Federation of Press Women, and the Illinois Woman's Press Association.


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