The demise of TIme Select also marks the birth of the new Paul Krugman blog, The Conscience of a Liberal. I would've preferred "Krog," but still: Exciting! Krugman starts things off with a graph of the top 10 percent's share of the country's income over the past century or so, and sections it off into four key periods in American economic life:
We're in the Great Divergence now, a period when the incomes of the rich are rocketing away from those of the rest of us. As Krugman writes:
Most people assume that this rise in inequality was the result of impersonal forces, like technological change and globalization. But the great reduction of inequality that created middle-class America between 1935 and 1945 was driven by political change; I believe that politics has also played an important role in rising inequality since the 1970s. It's important to know that no other advanced economy has seen a comparable surge in inequality – even the rising inequality of Thatcherite Britain was a faint echo of trends here.
In some ways, the conversation over whether inequality is being driven by impersonal, technical forces or government policy is neither here nor there (at least on a policy level -- politically, people use it to justify inequality as something organic, inevitable, and even beautiful -- like the tides). We live in a regulated economy governed by both public and private institutions, so there's no such thing as "natural" forces. Even if superstar CEOs are taking home billions, they're still reliant on our system of contracts, and limited liability, and stock market regulation. In other words, what public policy giveth, public policy can taketh away. Few doubt that we have the tools -- using something called "the tax code" -- to engage in some redistribution. The question is whether we have the will.
