RR: I'm told that it's doing extremely well -- exceeding all expectations.
Reich by Robert Reich
JB: Excellent. Let's get down to specifics about the film now. One of the strengths of Inequality for All is the use of animated graphics, for example, the suspension bridge imagery. Can you give some of the facts that the bridge graphic so vividly illustrates?
RR: The two peak years for income inequality over the past century were 1928 and 2007 -- in which the top 1 percent received over 23 percent of total income. In 1929 and 2008, the economy crashed. Why? Because when so much income is concentrated at the top, the vast middle class (and all those who aspire to join it) simply don't have the purchasing power to keep the economy going, without themselves going deep into debt. Eventually those debt bubbles burst (1929 and 2008), and when they do so, the economy goes into deep recession. The only reason the Great Recession wasn't as deep or as long as the Great Depression was we knew enough to stimulate the economy, and the Fed kept interest rates down. But these were and are only temporary band-aids. The underlying structural problem remains.
JB: Are there really enough parallels between 1928 and 2007 to make the suspension bridge a viable analogy? Or did you have to stretch or tweak the facts to get it to fit?
RR: Actually, the parallels are quite close -- not only with regard to income and debt, but also political divisiveness. The big difference, of course, was that the Depression was so deep that FDR could summon the political will for major reform. Ironically, the Great Recession wasn't nearly as deep -- because we used fiscal and monetary policy to cushion the economy -- so there hasn't been the political will for major reforms. As a result, the second tower of the suspension bridge is getting taller again.
JB: Back to basics for a moment, Bob. What's so bad about income inequality? Isn't it built into capitalism?
RR: Some inequality is both inevitable and desirable -- desirable if people are to have enough incentive to work hard, invent, and innovate. The real issue isn't inequality per se. It's whether we're getting to a level of inequality -- a degree of concentration of income and wealth in a relatively few hands, with the median family on a downward escalator -- that hurts our economy, democracy, and society. I believe we are.
suspension bridge graphic by "Inequality for All" website
JB: How did [infamous Supreme Court decision] Citizens United feed this disparity?
RR: "Citizens United" itself, and as it's been interpreted by lower courts, has opened the floodgates to big money inundating our democracy. It lets the wealthy entrench themselves even further -- by fighting tax hikes, getting larger tax loopholes, arranging for subsidies and bailouts for their companies, and getting rid of regulations they don't want.
JB: Speaking of regulations, it's worth noting that the Koch Brothers' oil concerns have received major fines over the years. They"re undoubtedly thrilled by the anti-regulation thrust of the Tea Party they've so generously sponsored. [See Frank Rich's 8.28.2010 NYTimes article " The Billionaires Bankrolling the Tea Party."] How does what's happening now with the government shut-down fit into the picture?
RR: It fits exactly. The Koch Brothers' political front group "Americans for Prosperity" is bankrolling millions of dollars of ads opposing the Affordable Care Act, presumably because they view the Act as a first step toward the kind of "socialized medicine" they think would erode their profits. They aren't troubled by a government shutdown that reduces the number of inspectors and enforcers of the very regulations they've opposed for years.
JB: That actually makes perfect sense. We Americans have often sensed that the rich were getting richer and the rest of us were standing still or losing ground. But until recently, we didn't have the facts and figures to back that up. Inequality for All features two researchers who were instrumental in changing all that. Tell us more, please.
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