RR: The two researchers are Emanuel Saez, a professor of economics here at Berkeley, and his colleague, Thomas Piketty. The two of them have done pioneering work on the extent of income inequality, by looking at tax records going back to 1913, when the federal income tax was instituted. Those tax records have given them ways to measure how much total income was going to the top 1 percent, the top one-tenth of one percent, and the top one-hundredth of one percent.
recent Reich book by Robert Reich
JB: And their findings confirmed our worst fears. There's a statistic on the website that states that the assets of one rich guy at the very top would be enough to house all the homeless in the country. That's a pretty graphic illustration of the pickle we're in! You point out that we needn't search any further afield than our own history for more equitable ways of "doing" the economy. Isn't that a stretch? Would you have been better served to look to Germany, for instance?
RR: It's not particularly helpful to tell Americans they should emulate another nation -- and it's not even necessary, because we did it well in the first three decades after World War II. America's economy doubled, as did the incomes of just about everyone. In fact, those in the bottom fifth rose faster than those in the top fifth. We achieved an extraordinary degree of equality -- and we also were serious about achieving equality of opportunity, through major educational investments (beginning with the GI Bill), extending through the Civil Rights Act and Voting Rights Act. We invested in infrastructure (the huge interstate highway program). And we had a tax structure that was truly progressive, with the highest marginal tax rate of 91 percent during the Eisenhower years. Even including all deductions and tax credits, the very rich faced an effective marginal tax of over 50 percent. We also regulated Wall Street, making banking boring -- as it should be.
JB: What a contrast to the current situation! What are you after with this film?
RR: Our goal is to change the national conversation about what's happening to jobs and wages, so that it's less of a blame game and more of a question about what rules of the game need to be changed, and how. We also want to inspire people to become more involved, and offer them some ways (through the website) they can make a difference.
JB: Sounds good. Back to the government shutdown for a moment, please. What do you think about how it's turning into a fundraising bonanza on all sides of the political spectrum? Is that not a tad unseemly and inappropriate?
RR: Unfortunately, extortion begets extortion. When a minority of congressional Republicans threatens the majority of Republicans with primary contests from the right if they don't play along, and then the majority of Republicans threatens the nation with a government shutdown and possible default on the nation's debt if the rest of us don't play along, we're on slippery slope -- not only to more extortion in the future, but also to more partisanship and divisiveness. The Republican Party's underlying strategy is to divide and conquer -- convincing large numbers of working Americans that the reason they're not getting ahead no matter how hard they work is because of the poor, mostly black and Latino, who are taking their tax dollars for welfare and threatening their jobs with low wages. The Republican Party's patrons don't want average Americans to know what's really going on -- that almost all the economic gains are going to the very top.
Reich's latest - now in paperback by Robert Reich
JB: That's all very true, Bob, but I am still wondering about every organization under the sun is using the shut down as an excuse to hit its membership for donations. Comments?
RR: My real concern is that the fiasco of a prolonged shutdown and even worse crisis of failure to raise the debt ceiling will cause so many Americans to give up on government altogether, raising the level of cynicism to an all-time high, that the monied interests will have it all to themselves.
JB: I know what you're saying. I was talking to a woman I met in the bathroom after the showing. She found the film powerful and frightening but short on solutions. She was also surprised that you are not cynical. How would you respond to her comment?
RR: We didn't want to put specific solutions into the film because we didn't want to make the film overtly political. But we do refer viewers to a webpage ( www.inequalityforall.com ) where we've assembled lots of information about what people can do and how to do it. As to cynicism, I avoid it and tell others to. When we become cynical and give up on politics, we give up on democracy -- and when we give up on democracy, we give up on everything. Also, if you look back on our history you see that time and again Americans have rescued capitalism from its own excesses; I'm absolutely certain we'll do that again.
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