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The Inclusive Economy
Book Review: After the Great Recession
By Bill Schweke on 09/29/2011 @ 10:30 AM
Journalist Don Peck has just written one of the most important books yet published on the Great Recession. Entitled “Pinched: How the Great Recession has Narrowed our Futures and What We Can Do About It,” the book does not delve into what caused the Recession, unlike the zillion other books currently published. Rather, Peck wrestles with how the Recession is affecting Americans today and how it is already reshaping our future. Indeed, Peck argues that the biggest effects are still to occur.
Peck’s main thesis is that major deflations and inflations put a stamp on a society. This one, without intelligent responses on our part, is likely to produce even greater inequalities in wealth and income, a reduction of men employed in the workforce, increased bread-winning roles for women, more tensions about race issues and immigration, later marriages and parenthood, the economic weakening of cities without unique and competitive assets, potentially ineffective political leadership, a protracted recovery and more.
Some in the workforce find themselves in “occupational ghettoes” where it is hard to find and step onto the next rung to upward mobility. Working poverty will likely become even more common. And, moderate-income families are starting to resemble inner-city households, rather than the middle class – joblessness, family conflict, drug and alcohol abuse, divorce and single-parenting all characterize these Americans.
Unlike the Great Depression, this economic era may drive us apart, culturally and politically, as well as reinforce current trends toward widening economic segregation. It could even encourage mass radical movements. At this point, these are more likely to be of the right-wing populist sort than of the leftist social movements sort. But, who knows? Mass apathy and weakened links of solidarity may be much more likely, given present trends.
The book’s final chapter offers humbly a manifesto for action. Advance short-term economic stimulus by government, Peck argues, while making plans for significant federal deficit reduction during the medium-term. Public subsidies should be provided for businesses to hire the long-term jobless. Make bigger investments in public works. Explore the development and application of regulatory reforms which would speed the process of R&D through commercialization. We must get a handle on health care costs. The wealthy should be taxed at a higher rate. Career academies should be established in order to smooth the transition from secondary schools to a job. Another experiment: wage insurance to “top up” the salaries of those persons who took a job that paid less than their previous employment.
Peck regards our present situation as dire, not desperate. Avoiding the latter danger is a function mainly of our coming together again as a people that are committed to each other. The proposed programs just listed would help immensely, but even more important is timely cultural change.
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