Obama’s State of the Union Address Failed to Look at Roots of Income Inequality

Written by on January 29, 2014 in Politics with 0 Comments

TRNN: Obama's address failed to look at roots of income inequality.  President Obama's State of the Union address focused on expanding economic opportunities by raising the minimum wage, making college more affordable and increasing economic mobility… During the previous five years of the current economic recovery income and wealth inequality has not only increased, but accelerated. That's according to economist Thomas Hickey and Emmanuel Saez. Joining TRRN to unpack all this is David Cay Johnston.  He's a pulitzer prize-winning investigative reporter and a contributing editor to Newsweek

Q. David, do you think President Obama's focus on expanding educational opportunities and raising the minimum wage are sufficient steps to narrowing the income gap?

David Cay Johnston: No – not even close.  It's important that we restore the minimum wage. We're not talking about raising it, we're talking about restoring it.  Back in the mid sixties it was almost eleven dollars an hour [in today's dollars].  And, education is certainly very important and too much neglected in this country.  We have put huge barriers to bright but poor and middle-class children getting a first-rate education – especially college.  But, we have much more fundamental problems than that.  Many of these problems involved things like government rules that hardly anybody knows about that take money from the many and redistribute it to the few. The use of tax dollars to build factories, office buildings, and shopping malls are the rules that allow multinational corporations, not domestic, not mom-and-pop corporations, but multinational corporations to actually profit of their corporate income taxes by delaying payment of them for thirty,forty, fifty years and having you and I let down deposit that money will be government to collect interest, while the value of the tax they owe erodes…

Q. David you previously published an article in nationalmemo.com titled “Inequality Rising – All Thanks To Government Policies.” What federal policies are most responsible for the income and wealth gap in your opinion?

David Cay Johnston: First and foremost we have shifted the income tax burden in this country down. And understand that the share of income that people in the middle class the upper middle class are paying is higher now than it was in the early sixties, while for people at the very top it's much lower.  That means people can't save, they can invest…

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