By Karen Petrou and Matthew Shaw
Yesterday, FRB Vice Chairman Clarida said that the U.S. economy is in “in a good place.” However, The Fed’s new study of American economic “well-being” shows that huge swaths of the United States are struggling harder than ever before to make ends meet. All but the most affluent Americans asked about how well they’re doing don’t feel anywhere near that good about it. Combine this with new data on the evaporating American middle class and an ugly picture quickly merges. In it, the prosperity in which the Fed takes such comfort rests thinly atop millions – indeed a hundred plus million – of Americans who are barely getting by at the height of the business cycle following a record-breaking “recovery.” No wonder that so many Americans remain so angry about their economic prospects and why political polarization is sure to define the 2020 election at least as much as it determined 2016’s outcome.
Continue reading “The Good, the Bad, and the Ugly in American Well-Being”
By Karen Petrou
As we have noted, here and here, the Fed is devoting increasing analytical – if not yet policy-maker – attention to the unequalizing impact of unconventional policy. It’s a start – a major problem besetting central banks in countries without a robust middle class – i.e., the U.S. – is that old-school representative-agent thinking leads to unanticipated, unequal outcomes when wealth and income are disproportionately enjoyed by the very few, very rich. It is for this reason that the Fed’s touted employment benefit and “robust” economy in the wake of post-crisis policy has done so little for so many who remain so angry. A new Fed paper helps to show why. Continue reading “The Low-Skill Losers”
By Karen Petrou and Matthew Shaw*
Like most who assess U.S. economic inequality, we’ve focused in this blog on the way income and wealth divide across Americans in general, by race, by age, by gender, by ethnicity, and even by nothing more than where one lives. However, working on another pro bono initiative – this time to speed biomedical research – it’s dawned on us that there’s another major factor that divides the haves from the have-nots that’s even less the result of individual action than all these well-studied demographic criteria: disability. Continue reading “If You Really Want to Be Unequal, Be Disabled”
By Matthew Shaw and Drake Palmer
Recent jobs data sparked excitement as news reports talked of how America is finally going back to work. This is understandable optimism, based as it was on a concurrent rise in labor-force participation and a drop in the government’s preferred measure of unemployment. Here, we assess whether the Fed’s “solid” and “very well performing” economy has finally allowed low-and-moderate income (LMI) households to share the prosperity rapidly pooling at the very top of the income and wealth distribution. In short, and sad to say, it isn’t – hourly pay for low-wage/low-skill workers has declined in real (i.e., inflation-adjusted) terms over the past four decades and is essentially flat since 2010. As we noted in our last blog post, wealth concentration has soared since the financial crisis. Even if a corner has now been turned for everyone else, it’s just a very tight one at the bottom of the equality canyon. Continue reading “Hard Work, Low Pay, High Costs: Life on the Ground in a “Well-Performing” Economy”
By Karen Shaw Petrou and Basil N. Petrou
Can a change in financial policy that speeds cures for blindness also cure the way disability now exacerbates U.S. economic inequality? Legislation introduced just yesterday shows how.
Like most severe disabilities, blindness and significant vision impairment are major causes of un- and under-employment. 72 percent of blind Americans are not employed on a full-time basis, which by definition almost always makes them among the most economically unequal of all Americans regardless of race, age, or region. To be sure, some blind people are gainfully employed – determination over the years and, now, technology and guide dogs drop the barriers to full achievement in almost every line of work and profession. But far too often, the problems in education that disadvantage all too many Americans are still worse for the disabled, as are perceptions about incapacity and even downright discrimination. Continue reading “Seeing One Way Out”