The New York Times‘s Nick Kristof had a great column over the weekend on the Occupy Wall Street protests, which he seems to understand better than most establishment pundits. He notes some stunning statistics, including the fact that the 400 wealthiest Americans “have a greater combined net worth than the bottom 150 million Americans,” and the top 1 percent “have more wealth than the entire bottom 90 percent.”
As my Times colleague Catherine Rampell noted a few days ago, in 1981, the average salary in the securities industry in New York City was twice the average in other private sector jobs. At last count, in 2010, it was 5.5 times as much. (In case you want to gnash your teeth, the average is now $361,330.)
More broadly, there’s a growing sense that lopsided outcomes are a result of tycoons’ manipulating the system, lobbying for loopholes and getting away with murder. Of the 100 highest-paid chief executives in the United States in 2010, 25 took home more pay than their company paid in federal corporate income taxes, according to the Institute for Policy Studies.
Kristof also notes that the common assumption — economic inequalities are simply the price of admission for an economy as large and powerful as ours — appears to have it backwards.
In his important new book, “The Darwin Economy,” Robert H. Frank of Cornell University cites a study showing that among 65 industrial nations, the more unequal ones experience slower growth on average. Likewise, individual countries grow more rapidly in periods when incomes are more equal, and slow down when incomes are skewed.
That’s certainly true of the United States. We enjoyed considerable equality from the 1940s through the 1970s, and growth was strong. Since then inequality has surged, and growth has slowed.
If I’m being completely honest, there was a point a few weeks ago at which I thought OWS needed to be more specific about an agenda. The most effective movements are those that are focused and striving towards clear goals. Occupy activists haven’t been, and still aren’t.
But Kristof’s column reminds me why that thinking was mistaken. Protestors aren’t demanding Congress pass a bill or approve a specific reform. They’re shining a light on systemic problems that can’t be fixed with one bill or one reform.
It’s not about economic inequality, or TARP, or the need for tax fairness, or stagnant middle-class wages — it’s about all of it and then some.
Kristof concluded these inequalities are “a cancer on our national well-being.” It would appear OWS is seeking a very broad cure.