tv The Stream Al Jazeera December 13, 2013 12:30pm-1:01pm EST
will move out. dell? the >> dave, thank you very much. i'm del walters in in new york, thank you for watching. "the stream" is next. ♪ >> how deeply does the you income gap affect your every day life? >> our digital producer is bringing you ive feed >> how deeply does the you income gap affect your every day life? >> our digital producer is bringing you live feed >> it is the size of the gap, the numbers are stunning.
our producer tweeted out the c.o. to average pay worker ratio was 20-1 back in the day, today 273-1. steve replies who cares, what your c.e.o. makes has no difference to address vaning your career. it's like twenties% owns 80% of the wealth. it's up to the american people to insist our legislatures do something about this problem. matthew says what purpose does an unfettered economy serve. >> when it comes to the unequal distribution of wealth, president obama calls income inequality the defining challenge of our time. >> since 1979, our economy has more than doubled in size, but
most of that growth has flowed to a fortunate few. the top 10% no longer takes in one third of hour income, it now takes half whereas in the past, the average c.e.o. made 20 to 30 times the income of the having a worker, today he makes 273 times more. >> what's driving america's wealth and income gab and why does it matter? joining us to answer those questions and i guarantee you many more is policy analyst as r. street institute which supports free market and limited government. ronald is the director of the program on justice and peace at gorge town university and derek hamilton from the new school in new york. thanks to all of you for joining us. lori, explain the difference between wealth inequality and income inequality. >> income inequality one get
your paycheck and it adds up to your income over the year. we know there's in equality between a c.e.o. and a worker at mcdonald's, wealth, your house, stocks, car, bonds, anything you have in your financial portfolio that you can use to work for you. as the wealth inequality is far larger than income because the people at the top have more wealth and their wealth continues to work for them a, where the middle class, their wealth tend to be in their home and cars and the the lower tends to have no accumulation at all. >> does one matter more than the other? >> to an extent, i think that wealth inequality can be a bigger problem particularly when as you see the size of government grow, people who have wealth continue to work for them continue to lobby the system, they have access that perhaps people at the bottom don't.
also at the bottom when you don't have access to pass on to your children, it can be hard to pass on to your children with the state of our education system, it can be hard to guarantee the type of opportunity that we he traditionally think exists in america. wealth inequality can i think be a bigger problem. >> randall is wealth inequality something that gross over time? >> it certainly seems to be growing over time. the gap between the rich and poor seems to be increasing and more importantly in some way, the strata are hardening, so where you tend to be born in that framework carries with you over time. wealth inequality is a broader construct than income inequality but adds in factors of health and education that factors in the course of your lifetime. >> our community has tweets, tom says the performance over the last 30 years shows you they can't be trusted.
jordan says our government does more for governments and banks than actual humans we tend to represent. one says the u.s. has great wasn't inequality along with disparity in health and education. these are the facts. >> when the gaps increase in income and power. civilization usually collapses upon itself. what are the detrimental impacts on u.s. quality of life. >> detrimental impacts on quality of life and living? some of the things have been hit on already, which is wealth is a primary indicator of one's well being. education, health, we often think of wealth as an outcome, but it's an input variable into everybody's living standards in virtually every indicator, education, health, political process.
if you're confronted with an expensive legal system, no matter what, you pretty much are going to finance that out of wealth if it's an expensive endeavor. >> lori, if the gap continues at this trajectory, does the top get helper, the bottom heavier and the middle class disappear? >> so it's hard to predigit. i mean, economies ebb and flow, right. there's been periods where the gap continues to grow and then you have, sort of the, you know, 1950's and 1960's where things collapsed back in. if it were to continue on the trajectory that it's on, sure, it could become problematic, but i think it's hard to say this is definitely where we're going, will always be going, it's become scientists and politician made this dire prediction. we make sure we guarantee
actions to opportunity. wealth inequality will always exist. people will have wealth, and it will be distributed in an uneven way. we could even the pie and people will do difference things with it. wealth one #-gs the very second day will exist. the question isn't isn't how much wealth inequality we have, it's where is it coming from, is it keeping people from accessing dreams and becoming where they want to come. given the wealth changes over time. >> what troubles you most? >> i think the most problematic is that it is -- i do think we've hit a point that it is where it is easier for people who have wealth, who have actions to continue that wealth and access. i agree really with the last tweet you read which is that we do favor sort of a corporate plutocracy, to the extent that
people are being locked out in favor of the already rich, that can be problematic if we're keeping people from having access at the bottom, because that really is the american dream. when we give money to corporations that and don't invest in education reform, that is a problem, because we have a failing education system. it doesn't have to be a problem while wealth inequality exists. >> this is something likely cyclical and economists don't agree, how you do we measure it? is it a snapshot, something that's looked at over a period of time. how do we do it? >> you have to look at these things over time. it is true that it's enormously difficult to predict. the salient point is that in an equal opportunity system, we would like to think that there is a level playing field. increasingly, wealth seems to be skewing the playing field. it tends to harden and perpetuate itself. that's not healthy for a society
or individuals that live in that society. increasingly it does seem to be the case that we're manifesting a 2-tiered society where those who can pay for better services and quality of life do so and then there's the rest of us. the idea that some how the middle class is still vibrant the way it was a generation ago is something that needs to be seriously reconsidered. >> i think we're kind of missing the point, that wealth itself provides opportunity. lori made a point about we want a society to give people opportunity. the indicator is indeed wealth, more so than education. wealth probably predicts education more than education predicts wealth. >> so i agree with you that wealth in and of itself is a great predictor of who will be successful. certainly statistics show that children born into wealthy households tend to do better over their life times. i don't think it's safe to say
at all if you were born without wealth that you have no hope. i mean, like i personally was born without a lot of wealth from a sort of struggling rural community and ever managed to do fine poor myself. obviously i'm not trying to use myself as an example of one. there's still access to the american dream, but we have to be cognizant of the ways we have locked people out and what we can do to rectify that situation in the future. >> this whole concept of sustainability and access, be they say: >> after the break, the role of race and whether government should play a part in reducing wealth and income inequality.
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what's your practical proposal? >> i have been talking about with my colleagues for quite a while, but i wanted before i even go into it, a lot of what we've been talking about is summed up in the definition of wealth. wealth is a stock of all your assets as opposed to income as a flow. if we really want to address wealth inequality, the market is not going to solve that. the airporter generational nature of it and stock nature of it is one where you need to intervene to address. the more you have to begin with, the more you have to accumulate. baby bonds are child trust accounts created at birth progressively designed so if you're born into the wealth poor family, you'll get the largest bond at birth and if you're born into the high wealth families, a smaller bond. when you become an adult, it's used as seed money to give you opportunity and economic
security to invest in some wealth building and endeavor, like purchasing a home, starting a business. if we truly want to have a capitalist system where people's efforts are rewarded, both conservative, liberals, democrats, republicans should all agree that we have an opportunity to have a stake in this and baby bonds is the answer, because it gives people seed money so they can have the fruits of their efforts rewarded. >> lori, in 1889, the gospel of wealth was created saying it's our responsibility as the most wealthy americans to redistribute our surplus to shrink the wealth gap. all the captains of industry signed on and funded schools and universities and museums and galleries, which still benefit us today. what has happened to that culture of philanthropy. does it stillist? >> it does. it's interesting to look at who gives and why.
you find that americans up and down the american distribution tend to be very charitable, which is one of the things that makes america beautiful and gives us hope that people can have access to opportunity, because we tend to want to help out our fellow american. i think one of the more interesting things to come to light is there was a study that as inequality increases and times get tougher, people trench in. >> even the wealthy? >> even the wealthy, people tend to be less philanthropic, because they feel less secure. we don't want to create conditions that would hurt people's willingness to be philanthropic. people instead of giving directly money, having people to your house to dinner, there are community mechanisms that i think supplant the charity that you don't necessarily see in the statistics. >> the streaming says:
>> there's an appeal to conscious to be made as was mentioned with the gospel wealth example. there's an interest op ed in the new york tiles by warren buffet's sons arguing that philanthropy is a way for the wealthy to the discharge their horrible obligations. i don't know that gets us very far to make that kind of appeal. there does seem to be a need for structural change besides
relying on people's largesse. sometimes it's a conversation between government and private enterprise, where the people who are affected by these decisions don't have as much a voice in the conversation. i'd like to see that third poll in the triangle be reinvigorated. >> we need to come up with a structure that gives everybody access to have an in cluesive structure. we're not talking about redistribution, we're talking about opportunity and people, we charity creating somebody's opportunity. >> all right. thank you very much. thanks to our guests this evening for a terrific conversation. until the next time, we'll see you on line.