Inequality for All is a 2013 documentary film narrated by former Secretary of Labor Robert Reich. The movie explains that the 400 richest Americans now own more wealth than the bottom 150 million combined. Reich explores what effects this gap has not only on the US economy but also on democracy. At the heart of the film is a simple idea: What is a good society and what role does the widening income gap play in the deterioration of the nation’s health?
Reich explains that during the period of prosperity starting in the 1940s, income inequality was low, unions were strong, wages were high, jobs were plentiful, tax revenues were adequate, and education was affordable. In the 1970s something went wrong–wages became stagnant due to globalization. This set off a viscous cycle:
- Low wages
- Inadequate Family income
- Declining demand for goods and services
- Declining tax revenue
- Lower wages
This development, Reich claims, threatens the very existence of the middle class in America. However, for a time, people struggled to compensate in three ways:
- Women went to work
- Workers worked overtime often at more than one job
- People assumed more debt
Reich explains that these opportunities are now exhausted so that many can no longer afford a middle class life.
Reich claims that the resulting income inequality is bad for everyone, rich and poor alike:
- When the economy suffers, business can’t prosper.
- Social mobility declines–children born to poor families are more likely to remain poor.
- Democracy is threatened by money in politics.
- Social order is threatened by growing discontent.
Reich concludes that the world has changed. We fell victim to a simplistic lie–that the free market is good. and government is bad. In reality, government makes the rules that allow the market to work and decides who benefits from those rules.
© William Hungerford – November 2014