Krugman: President’s Inequality Speech Deserves a Serious Hearing

Obama CAP speech

Writing Friday in the New York Times, columnist Paul Krugman asks all of us to give President Obama’s big inequality speech a serious hearing. Speaking at the Center for American Progress Wednesday, our President pointed to a combination of growing income inequality and a lack of upward mobility as “the defining challenge of our time.”

Our political class has spent years obsessed with a fake problem — worrying about debt and deficits that never posed any threat to the nation’s future — while showing no interest in unemployment and stagnating wages. Mr. Obama, I’m sorry to say, bought into that diversion. Now, however, he’s moving on.

…The wrong turn we’ve taken in economic policy — our obsession with debt and “entitlements,” when we should have been focused on jobs and opportunity — was, of course, driven in part by the power of wealthy vested interests. But it wasn’t just raw power. The fiscal scolds also benefited from a sort of ideological monopoly: for several years you just weren’t considered serious in Washington unless you worshipped at the altar of Simpson and Bowles.

Now, however, we have the president of the United States breaking ranks, finally sounding like the progressive many of his supporters thought they were backing in 2008. This is going to change the discourse — and, eventually, I believe, actual policy.

So don’t believe the cynics. This was an important speech by a president who can still make a very big difference.

Many of us, including myself, tend to discount our President’s remarks about inequality because his administration has consistently favored Wall Street over Main Street. His support for raising the minimum wage comes too late– unless the Democrats re-take the House next year, he will likely be the first President since Franklin D. Roosevelt in 1938 not to sign a minimum wage law.

Economist Arindrajit Dube:

[T]he evidence suggests that around half of the increase in inequality in the bottom half of the wage distribution since 1979 was a result of falling real minimum wages. And unlike inequality that stems from factors like technological change, this growth in inequality was clearly avoidable. All we had to do to prevent it was index the minimum wage to the cost of living.

Not coincidentally, 95 percent of income gains during the ongoing economic recovery have gone to the top 1 Percent.

The question is, should we take President Obama’s inequality rhetoric seriously, as Krugman suggests?

  1. #1 by cav on December 7, 2013 - 5:11 pm

    Doesn’t the fact that F. D. R. didn’t sign a minimum wage bill suggest there are bigger, higher-level approaches to addressing the inequality issue?

    And, I’m not suggesting the guillotines all be put on the back burner either.

    It should also be pointed out that “hard work” idea is an invention of the idle rich.

  2. #2 by Larry Bergan on December 7, 2013 - 9:21 pm

    It is a great Kennedyesque speach, but much too complex.

    “Either you’re with us or against us” would have carried more weight.

    Kidding aside: FANTASTIC SPEACH!

    Show me the money!

  3. #5 by brewski on December 8, 2013 - 4:12 am

    • #6 by Richard Warnick on December 9, 2013 - 8:14 am

      I remember that in 2010 the GOP promised us “jobs-jobs-jobs” and that they would defend Medicare.

      Then they cut jobs and attacked Medicare.

      • #7 by brewski on December 9, 2013 - 9:03 pm

        I remember when we were promised hope and change and all we got was Chicago thug cronyism.

        • #8 by Richard Warnick on December 10, 2013 - 7:26 am

          You should be happy. The right-wing bumper sticker ought to be: “No Hope For You!” You’re opposed to most of the changes progressives want to see.

          • #9 by brewski on December 10, 2013 - 8:28 am

            Regressives want Authoritarian Statism. How is that good for anyone except for the Powerful, wealthy and connected? You are supporting the 1%. I am on the side of the people.

          • #10 by cav on December 10, 2013 - 9:09 am

            Yes, but, the most important thing is to not raise taxes on rich people. Been there, done that.

          • #11 by Richard Warnick on December 10, 2013 - 9:16 am

            brewski, Man of The People. Sure, why not? Please support a $10 minimum wage as part of your makeover. Otherwise, you can’t complain about the lack of hope and change.

          • #12 by brewski on December 10, 2013 - 9:30 am

            Let’s just make it $25 per hour. There is no effect of minimum wage on employment. It is a law with no consequences.

          • #13 by cav on December 10, 2013 - 1:15 pm

            Meant to be broken, like all of the others – if you’re the right sort of person.

  4. #14 by Traveller on December 11, 2013 - 6:25 am

    Doesn’t matter what he says in in speeches anymore. No one is listening and no one cares what he says.

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