Tag Archives | Joseph Stiglitz

Joseph Stiglitz’s Three Steps to Solve Income Inequality

Maverick economist Joseph Stiglitz says there are three steps we need to take to remedy extreme income inequality. He sells his ideas via Yahoo News:

It’s the hollowing out of the U.S. economy. The haves are getting more, the have nots are getting less.  And the middle class is disappearing.

Between 2000 and 2013, every single state in the United States saw its share of middle-class families shrink, according to analysis from the Pew Charitable Trusts. In some states like Wisconsin and Ohio, that number fell by more than 5 percentage points; middle-income families now make up less than half of those states’ populations.

It’s not a new narrative but the modern story of inequality goes much deeper than stagnant wage growth. It’s inequality of opportunity as well.  It’s something Nobel-prize winning economist Joseph Stiglitz has studied and written about a great deal. He talks with Yahoo Finance Editor-in-Chief Andy Serwer in the video above.

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‘Freefall’ Excerpt: Too Late To Fix The Biggest Banking Blunder In History?

Rogue economist Joseph Stiglitz has a new book out, Freefall: America, Free Markets, and the Sinking of the World Economy, excerpted here by the Huffington Post:
The entire series of efforts to rescue the banking system were so flawed, partly because those who were somewhat responsible for the mess--as advocates of deregulation, as failed regulators, or as investment bankers--were put in charge of the repair. Perhaps not surprisingly, they all employed the same logic that had gotten the financial sector into trouble to get it out of it. The financial sector had engaged in highly leveraged, non-transparent transactions, many off balance sheet; it had believed that one could create value by moving assets around and repackaging them. The approach to getting the country out of the mess was based on the same "principles." Toxic assets were shifted from banks to the government--but that didn't make them any less toxic. Off-balance sheet and non-transparent guarantees became a regular feature of the Treasury, Federal Deposit Insurance Corporation, and Federal Reserve. High leverage (open and hidden) became a feature of public institutions as well as private. Worse still were the implications for governance. The Constitution gives Congress the power to control spending. But the Federal Reserve was undertaking actions knowing full well that if the collateral that it was taking on proved bad, the taxpayer would bail it out. Whether the actions were legal or not is not the issue: they were a deliberate attempt to circumvent...
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