On February 19th SCEPA was pleased to welcome economist and New School PhD Heather Boushey for a discussion on how inequality undermines economic growth—the topic of her latest book, Unbound: How Inequality Constricts Our Economy and What We Can Do About It.
The event began with a presentation by Dr. Boushey summarizing the findings in her book, Unbound. Based on Dr. Boushey's research (with the help of her team at The Washington Center For Equitable Growth) she showed three main ways inequality constricts our economy: first by obstructing ideas and access to the economy, next by subverting and manipulating the government institutions regulating the market, and lastly by distorting the sources of economic consumption so much so that it decreases investment in relevant products.
Monopsony power—or the increasing concentration of the economy into a small number of companies— and the effective erasure of unions (and their collective bargaining power) were highlighted as two of the many reasons why workers have had less power over the past 40 years than earlier generations to decrease this inequality. However, Dr. Boushey's most urgent recommendation is to push policymakers to measure GDP differently; to stop releasing GDP numbers alone and instead release them with contextualized numbers on where the country's economic growth is going.
Two of The New School's PhD candidates, Tracey Freiberg and Remzi Tercioglu, responded to Heather's presentation with strikingly different perspectives. Tracey focused on how companies keep wages low and inequality high, by offering benefits to workers that they are effectively barred from using, such as paid family leave, through shaming and other methods. And Remzi showed how we can expose our inflated GDP numbers by breaking the growth number out into different economic sectors, such as healthcare or financial services, where growth and tangible value is more subjective and thus harder to calculate.
David Howell closed the event with remarks about how, with time, our GDP has grown but the amount of high-quality, decent paying jobs has decreased. He used evidence from five OECD countries and concluded that France's policies were the only policies which increased the share of good paying jobs since the early 1980s. The event ended with a panel discussion and a Q&A moderated by Professor Howell.
Heather Boushey is President and CEO of the Washington Center for Equitable Growth, former Chief Economist on Hillary Clinton’s transition team, and a New School of Social Research Economics PHD. She is the author of Finding Time: The Economics of Work-Life Conflict and coeditor of After Piketty: The Agenda for Economics and Inequality.