Brown forum on Income Inequality and Social Mobility: Data Meets Policy in Providence

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Brown University’s Wealth and Income Inequality Project hosted a talk Monday afternoon with Providence Mayor Jorge Elorza, Brown President Christina Paxson and Professor of Economics John Friedman.

“I think reducing income inequality and increasing social mobility in America is one of the most profound policy challenges that we face right now,” said President Paxson framing the discussion. “What we know is that income inequality is on the rise, it has been for some time, social mobility is on the decline and we know a smaller fraction of children can expect to attain a living standard that is greater than their parents, which is something quite new for this country.”

Paxson continued, “There is no single magic bullet to fixing these problems… it’s going to take the concerted efforts of Federal, State, local policy organizations, community based organizations, as well as think tanks and universities to think about how we can reduce inequality and increase mobility.”

Brown economics professor John Friedman is perhaps best known for his work on the Opportunity Atlas, an interactive online resource that answers the question of “Which neighborhoods in America offer children the best chance to rise out of poverty?” by using anonymous data following 20 million Americans from childhood to their mid-30s.

Friedman presented the data that shows that upward mobility is getting harder in the United States. The fraction of children who grow up to attain a higher standard of living than their parents. For instance, in 1940, more than 90 percent of children grew up to exceed their parent’s standard of living.

“People talked about the American dream not even as having a higher standard of living than their parents but perhaps even doubling the standard of living of one’s parents,” said Friedman.

The percentage of children that could be expected to do better economically than their parents fell steadily over the next forty years, “So that by the time I was born in 1980, it was literally no better than a coin flip whether children would have a higher standard of living than their parents did.”

Here is Friedman’s entire presentation, which goes into much deeper detail and even offers some intriguing ideas on how to begin fixing this situation.

Addressing income inequality and decreasing social mobility falls to local leadership, said Providence Mayor Jorge Elorza. “The leadership on this issue… is not coming from Washington, and it’s… very difficult for it to come from the state level,” said Elorza. “So I think civic and municipal leaders have to play a role.”

“I talk to my colleague mayors throughout the country on a regular basis and while we will all say that social and economic mobility is a great challenge and great concern in our communities, being realistic, every mayor will also tell you that we simply don’t know how our cities fare,” said Elorza. “We don’t know how we fare now, to how we did previously, and we also don’t know how we fare now compared to how other cities are faring now.”

Friedman’s research, said Elorza, is very helpful in that regard. Here are all of Elorza’s comments:

The forum ended with questions from Paxson and from the audience.


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About Steve Ahlquist 1030 Articles
Steve Ahlquist is a frontline reporter in Rhode Island. He has covered human rights, social justice, progressive politics and environmental news for half a decade.Uprise RI is his new project, and he's doing all he can to make it essential reading.atomicsteve@gmail.com

2 Comments

  1. Nothing very surprising in the presentation, but it is all based on economic conditions that are unlikely to persist as ecological collapse and climate change will shrink the overall economy, further reducing upward mobility

  2. Income inequality is a problem but not as much as wealth inequality. Wealth inequality focuses on ownership – who own or do not own revenue producing assets (not homes), including businesses and financial assets/portfolios. Revenue producing assets are passed from one generation to another, over time producing a super rich class with oligarchic powers over government and social/economic policies. Elizabeth Warren, the most knowledgeable political person on the realities of wealth and poverty, proposes a yearly tax on accumulated wealth, not just yearly income. This a person worth a billion dollars would pay each year 1-2% of that billion (plus any tax on yearly income). The billionaires affected would still grow richer and richer (accumulated wealth grows at 4% to 20% annually for those who do not pursue stupid schemes).

    Warren’s tax is not designed to eliminate the super wealthy class but to produce a huge stream of public revenues for spending to benefit the lower classes and to deal effectively with climate change dangers. Of course the oligarchic control by the super wealthy over the US govt (Democratic as well as Republican) is determined to cut off any tax reforms that do not benefit the super wealthy by increasing their wealth. On the other hand the ravages of climate change may become so dire that the US govt will finally be put in the hands of people who will stand up against the power of the oligarchs and tame them into shouldering their share of the huge costs that climate change management and increased economic equality programs will demand.

    In the long run, however, monopoly political power will return to the oligarchs unless the ownership of revenue producing property is more widely distributed through worker owned businesses (co-ops and ESOPS); community-worker owned businesses; social enterprises legally bound to benefit defined needy people and communities; anchor institutions contractually bound to hire local worker owned business services, worker-community owned business services, and social benefit services; and rental and home owning land trusts.

    I have noticed that Elorza talk of working with Providence’s anchor institutions. But as far as I can tell he means in attracting tech businesses and their highly paid workers to the city in order to increase its tax revenues and, collaterally, vastly reduce affordable housing for the lower middle class/working class. I do not hear him talking about obliging these anchor institutions to hire local worker owned businesses and social enterprises as is in the case in the Cleveland model, which originated the the concept of anchor institution-municipal partnerships. Elorza’s concept seems to be a vastly expanded East Side and a city cleared of people who make too much to get public housing and too little to pay market driven rents in Providence.

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