The Huffington Post flagged this comment earlier today, and understandably so.
Say what you will about Goldman Sachs -- and you could say a lot -- but its CEO, Lloyd Blankfein, recently boiled down one of America's most complex problems into a perfectly simple and quotable line. Repeat after Lloyd, folks:
The observation came during a talk at an industry conference Tuesday, according to Fortune. Blankfein, of course, is referring both to America's long and enviable history of economic growth, and its more recent inability to make sure all Americans experience the benefits of that growth.
The article goes on to note with charts, etc., that -- in case you've been asleep in the Catskill Mountains for the last 20 years -- almost all of the gains in gross national product in recent years have flowed to the top 1 Percent at the expense of the bedraggled American worker.
So what is the solution? Well, I guess if the problem is that wealth is not properly distributed, we could always, um, you know, redis...oh, nevermind.
Look, the mere mention of "redistributing wealth" is political suicide in America, and understandably so. In the American mind -- such as it is these days -- it's a short step from a modest change in the tax code to forced labor camps. The reality is a little more subtle, but who goes for subtle these days? A couple of really quick thoughts.
1) The U.S. government (like every other government in the world) already distributes our wealth -- your wealth, my wealth, our wealth -- every single day, and it's done so under conservative Republican presidents just as it would do under a liberal Democratic president if by some miracle we ever had one. When we decide whether to fund schools through a property tax or a sales tax, we redistribute wealth. The ever-popular progressive income tax is a redistribution of wealth.
It's like that old lame joke about prostitution -- we've already established that redistribution of wealth exists, we're just haggling over the price. Over the last 30 years, Washington has done a lot to redistribute wealth -- lower marginal tax rates, massive tax breaks for oil companies and other large corporations -- and almost all of the redistribution has been upwards. I don't think it's a Marxist revolution just to swing that pendulum just a tiny ways back to near where it was, back in the era when the middle class was booming.
2) There are ways to redistribute wealth that -- crazy as this sounds -- don't involve Big Government. One such way would be (gulp) voluntary. One of the most epic moments in American economic history was Henry Ford deciding -- of his own free will -- to pay his workers what today we would call "a living wage." The workers could afford to buy the cars they built -- and other stuff; they were happy, Henry Ford was happy (and rich), and capitalism worked.
It sounds whack, but there was a day when some CEOs didn't think it was such a good idea to make 350 times what their average worker made. There's also another way to promote income equality that functions (partly) outside of government -- and that's called collective bargaining. I'm not going to pretend that the 1950s were a "Father Knows Best" morning-in-America nirvana, but the middle class was surely stronger when unions were stronger.