Visiting economist speaks on recession

The U.S. economy is heading into rough waters, with income inequalities for families, said visiting economist Jared Bernstein Monday night, but, he added, there are solutions.

Bernstein spoke as part of the ongoing College of Urban and Public Affairs lecture series, “What’s the Big Idea?” Bernstein, an economist at the Washington, D.C.-based Economic Policy Institute, spoke in the Smith Memorial Student Union about what he said is an economy that is sliding toward recession and how that is negatively affecting the middle- and lower-income earning classes.

He also highlighted government-led cures for recession and the reasons that current government and market-based remedies only worsen the situation.

After Bernstein’s lecture, a lively dialogue took place between students and locals, who discussed the topic of income inequality and the current state of the economy.

Even though the economy continued to grow after the 2001 recession, Bernstein said, the top 1 percent of the population reaped most of the gains. Because the last economic growth cycle created fewer jobs than normal, he added, unemployment remained high. It also created “the absence of bargaining power that most workers face,” he said.

Bernstein’s lecture also covered consequences of globalization.

Increased global trade has increased worker supply and depressed wages for workers all over the world, he said, but it has also given the world an increased flow of ideas and cheap goods. Global trade is a “double-edged sword with both good and bad effects,” he said.

Bernstein discusses these ideas and more in his new book, Crunch.

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The issues Jared Bernstein discussed in Monday’s lecture affect Oregon as well as the rest of the country.

In a news release issued last Thursday by the Oregon Center for Public Policy, a think tank based in Silverton, Ore., the state’s low-income families pay a 9.2 percent tax rate compared to the top 1 percent of families that pay a 6.7 percent tax rate.

Additional tax rebates like the Oregon Income Tax Kicker also benefit higher-income brackets more than the lower-income groups, according to an OCPP report published in October of last year.

For the OCPP’s most up-to-date reports and publications, visit their Web site at www.ocpp.org.