Does wealth inequality undermine economic opportunity for all?
The evidence that it does is rolling in. This month, I have an article in American Prospect called “The Wealthy Kids Are All Right.”
I summarize the mountain of growing research demonstrating how affluent families engage in what sociologists call the “intergenerational transmission of advantage.”
The story goes like this: as wealth inequalities grow, two things happen that undermine equality of opportunity. First, affluent families help their kids in dozens of ways to get a leg up in preparing for school, getting into selective colleges and launching decent paying careers. Secondly, unequal societies start to disinvest in the public sector and the social investments that give non-affluent households opportunities.
The “politics of inherited advantage” looks like this: Since wealthy families have disproportionate wealth and power in our political system, but have privatized their needs, they have less of a stake in paying progressive taxes and making the kinds of social investments that fostered the period of shared prosperity in the 30 years after World War II. Think debt free college educations, subsidized fixed-rate home mortgages, public universities, Head Start.
Now this doesn’t encompass all affluent families. Many of our “wealth for the common good” allies work tirelessly to foster opportunity for all.
If you question these assertions, please read my article. I describe the accelerating advantages for the wealthy and the compounding disadvantages for everyone else. I tell the stories of four 21-year-olds and their different life trajectories based on family of origin.
So what can someone with a “wealth for the common good” perspective do?
Stay on message: it’s working! Make the powerful case for retaining a progressive federal tax system and directing tax dollars for public expenditures that foster economic opportunity. Statements over the years by you, Wealth for the Common Good members and Patriotic Millionaires are changing the tax debate. (More on this in a future blog.)
And on a personal level, what should we do when it comes to our own children and grandchildren? In The American Prospect article, I argue that if we genuinely care about eroding equality of opportunity, we should consciously use any special privileges to stop the advantage arms race.
It is worth asking the question, “How much advantage should one child have in a democratic society that aspires to the ideal of equality of opportunity?”
If we choose to help our kids, we should account for the advantages and, as I write in the article, “should match any family subsidies with tax dollars and donations to organizations that level the playing field. Donors should fund paid internship positions at nonprofit organizations they care about, expanding the pool of young people that can intern there.“
Personal decisions, along with our work on the larger policy matters, will make a difference. But we should tell such stories as a matter of witness. My own child has had huge advantage in terms of social capital, enrichment opportunities and school readiness. But she has attended the Boston public schools for all but one year of her life, which has given me a powerful personal stake in our local education funding and oversight. Her education is never out of sight, nor out of mind.
Wealth inequality matters. The slow drift toward an ever-widening opportunity gap is one of the corrosive results of too large a gap in wealth and income. The good news is, individually and collectively, we can make a powerful witness to level the playing field.