An important theme here at OTE is that it is not enough to show rising inequality and wring your hands and rend your garment. You’ve got to explain why it’s problematic. In some cases—the split between median compensation and productivity—the connection hardly needs elaboration: workers are baking a larger pie yet getting smaller slices.
But a connection that I consider especially important is that between inequality and opportunity (e.g., here, here, here, this presentation, etc.). To the extent that a greater economic distance between classes is blocking the opportunities of those on the “wrong” side of the income divide, a fundamental value of ours is blocked. Americans do not believe in equal outcomes; many of us do, however, believe in equal opportunities, or at least that someone ought to be able to achieve their intellectual, economic, and spiritual potential. Yes, I know—our history shows that we have and continue to live with social and economic divisions that belie that core belief. But it remains a core belief.
So I’m always on the lookout for evidence of linkages between rising inequality and diminished opportunity. I stumbled on this very interesting talk given by the President’s chief economist Alan Krueger, and while the inequality/opportunity theme doesn’t run central to the piece, it’s in there and Alan posts some useful pictures worth considering in this debate.
The first is one I’ve used a lot—the growing disparity in enrichment expenditures for kids as income inequality has gone up.
The second and third show related gaps in extracurricular activities in and out of school (unfortunately they’re a decade out of date—one suspects these gaps have widened).
Moreover, as we hack away at budgets to support these types of activities in our schools, we are shifting the locus of their provision from the public to the private sector. Given the trends in income distribution, that is a recipe for less advantaged kids to be less exposed to these goods and services.
These pictures are by no means dispositive. There are obviously many determinants of the extent of opportunity to which a child is exposed. But to me and to Alan and to others they are surely suggestive of the corrosive linkage between greater economic disparity and less opportunity for all.
Source: Alan Krueger