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Addressing our inequality problem

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From page A14 | January 27, 2013 | Leave Comment

One of the features of the Obama years is that we get to witness an enormous race, which you might call the race between meritocracy and government. On the one side, there is the meritocracy, which widens inequality. On the other side, there is President Obama’s team of progressives, who are trying to mitigate inequality. The big question is: Which side is winning?

First, there is our system of higher education, which is like a giant vacuum cleaner that sucks up some of the smartest people from across the country and concentrates them in a few privileged places.

Smart high school students from rural Nebraska, small-town Ohio and urban Newark get to go to good universities. When they get there they often find a culture shock.

They’ve been raised in an atmosphere of social equality and now find themselves in a culture that emphasizes the relentless quest for distinction — to be more accomplished, more enlightened and more cutting-edge. They may have been raised in a culture that emphasizes roots, but they go into a culture that emphasizes mobility — a multicultural cosmopolitanism that encourages you to go anywhere on your quest for self-fulfillment. They may have been raised among people who enter the rooms of the mighty with the nerves of a stranger, but they are now around people who enter the highest places with the confident sense they belong.

But the system works. In the dorms, classrooms, summer internships and early jobs they learn how to behave the way successful people do in the highly educated hubs. There’s no economic reason to return home, and maybe it’s not even socially possible anymore.

The highly educated cluster around a few small nodes. Decade after decade, smart and educated people flock away from Merced; Yuma, Ariz.; Flint, Mich.; and Vineland, N.J. In those places, less than 15 percent of the residents have college degrees. They flock to Washington, Boston, San Jose, Raleigh-Durham and San Francisco. In those places, nearly 50 percent of the residents have college degrees.

As Enrico Moretti writes in “The New Geography of Jobs,” the magnet places have positive ecologies that multiply innovation, creativity and wealth. The abandoned places have negative ecologies and fall further behind.

This sorting is self-reinforcing, and it seems to grow more unforgiving every year. One small study caught my eye. Robert Oprisko of Butler University found that half of the jobs in university political science programs went to graduates of the top 11 schools. That is to say, if you have a Ph.D. from Harvard, Stanford, Princeton and so on, your odds of getting a job are very good. If you earned your degree from one of the other 100 degree-granting universities, your odds are not. These other 100 schools don’t even want to hire the sort of graduates they themselves produce. They want the elite credential.

Barack Obama (Occidental, Columbia, Harvard) benefited from this sorting system. So did his wife (Princeton, Harvard). So did most people in his administration. So did many people who read The New York Times and many of us who write for it.

Members of the administration have worked reasonably hard to mitigate the inequality that their own rise has produced. They’ve worked reasonably hard to redistribute money from the rich people in the magnet areas to the poorer people in the flight areas. For example, the health care law increases taxes on the top 1 percent by about $20,000 per household. It increases benefits for the working class by between $400 and $800 per household. The recent tax increases will do more of the same.

The first problem with the effort is that it’s like shooting a water gun into a waterfall. The Obama measures, earned after a great deal of political pain, simply aren’t significant enough to counteract the underlying trends.

The second problem is the focus on income redistribution. Recently, there’s been far more talk about tax increases than any other subject. But the income disparities are a downstream effect of the human capital and geographic disparities. Pumping a few dollars into San Joaquin, Calif., where 2.9 percent of the residents have bachelor’s degrees and 20.6 percent have high school degrees, may ease suffering, but it won’t alter the dynamic.

The final problem is that, in an effort to reduce the economic concentration of power, the administration is concentrating political power in Washington. If the problem is that talent is fleeing blighted localities, it’s hard to see how you make that better if decision-making and resources are concentrated faraway in the nation’s capital.

This is not to make a partisan point. The Republicans do not have a better approach. It’s simply to say that the liberal agenda is not very good at addressing the inequality problem it seeks to solve. The meritocracy is overwhelming the liberal project.

— The New York Times

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