ast time I spoke of concerns over the twin problems of increasing income inequality and a virtual freeze on wages.
Concern is appropriate, because both problems are occurring. But raising the minimum wage would not solve either problem, because the minimum wage is not the cause of our current economic malaise. It couldn't be, because too few workers actually earn only minimum wages.
We cannot prescribe a solution until we correctly diagnose the problem, and the truth is that we do not understand fully what causes income inequality and wage stagnation. Beware snake oil peddlers offering simplistic solutions to complex problems. We do know a few things.
First, there is still mobility – even while income inequality increases. People do move up and down the income ladder?. Thankfully, we are not yet a rigid class society, but the very top income earners are pulling away from the rest.
Second, increasing job requirements are leaving many workers behind.
Third, recent immigration trends tend to produce more lesser-skilled, low-wage workers.
Fourth, globalization permits us to import products from ?low-wage countries rather than manufacture them here ourselves.
Fifth, p?olitical and economic uncertainty tends to constrict economic growth and expansion.
?What emerges is that the causes of income inequality and wage stagnation are complex and varied. No one magic solution, therefore, exists. Several different partial remedies deserve to be considered, and we will examine some next time.
I'm Bob Evans, and that's my perspective.
