By Fareed Zakaria
Is income inequality the “defining challenge” of our time? President Obama's speech earlier this month on the topic has provoked a lively debate on this subject.
I think part of the confusion that some people have is that when we talk about inequality we’re often talking about three different things. First, the astonishing rise of the very rich. Second, the stagnant wages and poor prospects of the American middle class. And third, the large number of people at the very bottom of the ladder.
These are distinct phenomena. They may be related – the rise of the rich might be causing the stagnation of the middle class – but the research on that is mixed.
Of the three problems, the easiest to fix is the one we spend the least time talking about: the fate of the poor, who now number 46 million. Since the poor tend not to vote nor lobby nor petition politicians, they don't get much attention. And as a result, government does not devote much energy or resources to their problems, especially those of poor children who suffer from malnutrition, bad health, and poor education, which cripple their chances of escaping poverty. The resources needed to change this would be a fraction of what we spend on the middle class in this country.
We don't have all the answers but if you're looking for the policy that would likely have the biggest effect on raising social mobility and reducing inequality, let’s shift the attention from the rich and the middle class and focus for once on the 46 million Americans who are often forgotten.