I’m too jet-lagged to write much about this, and am coming late to the lively discussion over Saez & Piketty’s latest piece about rising income inequality. The dramatic rise in earnings and wealth inequality between the 1% and the rest of the country is important, and as Krugman says, demoralizing for most Americans. But there’s another piece to this, which is that the economic recovery is only in the private sector.
Coming through the San Francisco airport yesterday, I waited for over an hour to pass through the border. The line for non-citizens was several hours long. It’s clear that the wealth of the U.S. is monopolized by individuals (and corporations), and little of it is evident in our infrastructure, public services, or public spaces. So not only are non-rich Americans seeing their earnings stagnate or shrink, they are surrounded by a country that spends less (after you account for inflation and population growth) on public goods year after year after year. Since rich people can often bypass public goods entirely (private schools, private security, the fast-track airport line), dwindling public investment in this country affects the poor and middle-class much more.