ISSUES IN INCOME AND WEALTH INEQUALITY
(34: 833:684:01)
Edward J. Bloustein School of Planning and Public Policy
Rutgers - The State University of New Jersey
Mondays: 1:10 p.m. to 3:50 p.m.
Civic Square Building (CSB)--room 112
Professor Henry A. Coleman
(848) 932-2972 (office phone)
hcoleman@rci.rutgers.edu (email)
Course Syllabus-Spring 2015
I. Description
There is an old adage that “the rich are getting richer, and the poor are getting poorer.” Writing in the New York Times,
University of Texas Professor Thomas McGarity made the following observations regarding a recent speech that
President Obama had made on inequality:
President Obama’s speech on inequality …was important in several respects. He identified the threat to economic stability,
social cohesion and democratic legitimacy posed by soaring inequality of income and wealth. He put to rest the myths that
inequality is mostly a problem afflicting poor minorities, that expanding the economy and reducing inequality are
conflicting goals, and that the government cannot do much about the matter.
http://opinionator.blogs.nytimes.com/2013/12/08/what-obama-left-out-of-his-inequality-speech-regulation/
Starting with the President’s speech, this course will examine some of the major policy issues surrounding the
(presumed) increase in inequality in the United States. The course will have several components.
1. An overview of how inequality is defined and measured, with a particular emphasis on distinguishing between
income and wealth inequality.
2. Review the major trends in income and wealth inequality over the last several decades, and the factors that have
affected it.
3. Provide a general overview of the impacts (i.e., the benefits and costs) of inequality.
4. An examination of the impacts of inequality on several important policy areas---an illustrative list of potential issues
to consider would include: crime and incarceration; economic growth and stability; employment opportunities and
worker compensation; healthcare; housing; poverty; and race, gender, and family structure.
5. An examination of the impacts of government policies (especially tax and spending) on inequality over the last
several decades.
6. A consideration of the outlook for income and wealth inequality in the USA, and the kind of policies (and policy
tools) that should be employed to address it.
These are among the issues to be considered during this course.
II. Readings
The readings consist of required and recommended texts, recent reports produced by public agencies and/or policy
think tanks (generally available from the Internet), and journal articles and book chapters. Links to most readings are
contained in the syllabus or available at https.sakai.rutgers/edu/portal. As a general rule, you will be expected to
complete the assigned readings prior to the class discussion. The required books, which students are expected to
purchase, are available at the Rutgers University Book Store:
David Cay Johnston (2014), Divided: The Perils of Our Growing Inequality (New York: The New Press) (DCJ)
Joseph E. Stiglitz (2013), The Price of Inequality: How Today’s Divided Society Endangers Our Future (New York:
W.W. Norton & Company) (JES)
Other valuable sources of research/analysis related to inequality include:
Pathways: a magazine on poverty, inequality, and social policy, published by the Stanford Center on Poverty and
Inequality (www.inequality.com)
and
Focus, the newsletter of the Institute for Research on Poverty, published by the University of Wisconsin-Madison
(www.irp.wisc.edu).
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III. Evaluation
Grading for the course will be based on several factors, including:
1. Leadership of in-class discussion of a selected weekly topic
2. A 15 (minimum)-20 (maximum) page policy paper (your paper topic, tentative outline, and preliminary list
of references must be submitted by March 30 and your paper is due on April 20--more details to follow)
3. An in-class oral presentation on the major issues, findings, and recommendations from your paper
(scheduled for April 20)
4. An in-class final examination (scheduled for May 4)
5. General contributions to class discussions
IV. Office Hours
My office hours will generally be on Tuesdays from 4:30 p.m. to 5:30 p.m., Wednesdays from 11:00am until noon, and
by appointment. My office is located in room 550 of the Civic Square Building at 33 Livingston Avenue in New
Brunswick.
V. Rutgers University’s Academic Integrity Policy
Academic misconduct is a growing problem at institutions of higher education around the country. Each and every
year, Rutgers students are suspended, expelled or receive failing grades due to violations of academic integrity. Many
of the students who are caught cheating were unaware of the consequences or even unaware that their actions
constituted cheating at all. Academic misconduct includes cheating, plagiarism, failure to cite sources, fabrication and
falsification, stealing ideas, and deliberate slanting of research designs to achieve a pre-conceived result. If it occurs,
academic misconduct will be dealt with harshly. Students should acquaint themselves with this problem. The
University’s Academic Integrity Policy can be found at: http://teachx.rutgers.edu/integrity/policy.html.
VI. Attendance Policy
As a general rule, students are expected to attend class sessions and to contribute to class discussions. Students are
required to attend classes on the day that examinations are scheduled (see above). While there are no formal penalties
for missing individual class sessions, students do so at their own risk---my lecture outline/notes will not be posted on
sakai or otherwise made available to students.
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ASSIGNED READINGS
(Note that other readings may be added or substituted as new information and/or updates become available.)
Weeks one and (January 26- February 2)
What is inequality, what causes inequality, and why is it important?
JES chapters 1-4
DCJ/Hungerford
Feldstein, Martin (1999), “Reducing poverty, not inequality,” The Public Interest, number 137 (fall), pp. 33-41
Mather, M. and B. Jarosz (2014), “The Demography of Inequality in the United States,” Population Bulletin published
by the Population Reference Bureau, volume 69, no. 2 (November) (available at http://www.prb.org/pdf14/unitedstates-inequality.pdf)
Obama, B.H. (2014), “Remarks by the President on Economic Mobility,” (December 4) (available at
http://www.whitehouse.gov/the-press-office/2013/12/04/remarks-president-economic-mobility)
Week three (February 9)
Inequality measurement and trends---are the rich getting richer and the poor getting poorer?
Buss, J.A. (2010), “Have the Poor Gotten Poorer?: The American Experience from 1987 to 2007,” Journal of Poverty,
14:183-196 (available at http://www.tandfonline.com/doi/pdf/10.1080/10875541003711813)
Cole, Alan (2014), “Income Data Is a Poor Measure of Inequality,” Tax Foundation Special report No. 224 (August)
(available at http://taxfoundation.org/sites/taxfoundation.org/files/docs/SR224.pdf)
Gottschalck, Alfred, Marina Vornovytskyy, and Adam Smith (2011), “Household Wealth in the U.S.: 2000 to 2011”
(available at http://www.census.gov/people/wealth/files/Wealth%20Highlights%202011.pdf)
Nichols, Austin (2012), “Inequality: A Brief Overview,” Income and Wealth Distribution, no. 1, The Urban Institute
(February) (available at http://www.urban.org/UploadedPDF/412515-Inequality-A-Brief-Overview.pdf)
Stone, C., D. Trisi, A. Sherman, and B. DeBot (2014), “A Guide to Statistics on Historical Trends in Income
Inequality,” Center on Budget and Policy Priorities (December 10) (available at http://www.cbpp.org/files/11-2811pov.pdf)
Week four (February 16)
Does inequality persist across generations?
DCJ/Bernstein
Jantti, M. (2009), “Mobility in the United States in comparative perspective,” in Focus, a newsletter of the Institute for
Poverty Research at the University of Wisconsin at Madison, volume 26, number 2 (fall) (available at
http://www.irp.wisc.edu/publications/focus/pdfs/foc262g.pdf)
Sawhill, I.V. (2008), “Trends in Intergenerational Mobility,” Pew Charitable Trust, Economic Mobility Project
(available at
http://www.brookings.edu/~/media/research/files/reports/2008/2/economic%20mobility%20sawhill/02_economic_mob
ility_sawhill_ch2)
Urahn, S. K. et al. (2012), “Pursuing the American Dream: Economic Mobility across Generations,” Pew Charitable
Trust, Economic Mobility Project (available at
http://www.pewtrusts.org/~/media/legacy/uploadedfiles/pcs_assets/2012/PursuingAmericanDreampdf.pdf)
Week five (February 23)
How does the quantity/quality of education affect inequality?
DCJ/Darling-Hammond
DCJ/reardon
Haskins, R. (2008?), “Education and Economic Mobility,” Pew Charitable Trust, Economic Mobility Project (available
at
http://www.brookings.edu/~/media/research/files/reports/2008/2/economic%20mobility%20sawhill/02_economic_mob
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ility_sawhill_ch2)
Heckman, J.J (2011), “The Economics of Inequality: The Value of Early Childhood Education,” American Educator
(spring) (available at http://www.aft.org//sites/default/files/periodicals/Heckman.pdf)
Week six (March 2)
Does inequality attenuate democracy?
JES chapter 5
DCJ/Obama
Friedman, B. (2008), “Widening Inequality Means a Democracy at Risk,” in Pathways: a magazine on poverty,
inequality, and social policy, published by the Stanford Center on Poverty and Inequality (available at
http://web.stanford.edu/group/scspi/_media/pdf/pathways/summer_2008/Friedman.pdf)
Pew Research Center (2015), “The Politics of Financial Insecurity: A Democratic Tilt, Undercut by Low Participation,”
(January 8) (available at http://www.people-press.org/files/2015/01/1-8-15-Financial-security-release.pdf)
Weiser, W. and E. Opsal (2014), “The State of Voting in 2014,” Brennan Center for Justice, NYU School of Law (June
17) (available at http://www.brennancenter.org/analysis/state-voting-2014)
Week seven (March 9)
Does inequality of income/wealth mean unequal access to justice and healthcare?
JES chapter 7
DCJ/Ackerman and Heinzerling
DCJ/Bezruchka
DCJ/Serres and Howatt
DCJ/Wilkinson
Harris, B.H. and M.S. Kearney (2014), “The Unequal Burden of Crime and Incarceration on America’s Poor,” The
Hamilton Project at the Brookings Institution (available at
http://www.hamiltonproject.org/files/downloads_and_links/Crime_blog_post_april28-FINAL_v3.pdf)
Week eight (March 16) spring break---NO CLASS
Week nine (March 23)
Does inequality mean a vanishing middle class and adverse impacts for the rich/wealthy?
DCJ/Adler
DCJ/Frank
DCJ/Warren
Frank, R.H. (2011), “Gauging the Pain of the Middle Class,” The New York Times (April 2) (available at
http://www.nytimes.com/2011/04/03/business/03view.html?_r=0)
Walker, L. (2012) “War on Wealth III,” (February 27) (available at http://larrymwalkerjr.blogspot.com/2012/02/waron-wealth-iii-national-debt-review.html)
Ketcham, C. (2012), “The New Populists: The rise and fall of Zuccotti Park---and the future of the movement it
birthed,” The American Prospect (January-February) (available at http://prospect.org/article/new-populists-0)
Stiglitz, J.E. (2011), “Of the 1%, by the 1%, for the 1%,” Vanity Fair (May) (available at
http://www.vanityfair.com/society/features/2011/05/top-one-percent-201105)
Week ten (March 30)
How do government (fiscal) policies affect inequality?
DCJ/Rivkin
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JES chapter 8
Chamberlain, Andrew, Gerald Parante, and Scott A. Hodge (2007), “Who Pays America’s Tax Burden and Who Gets
the Most Government Spending?,” Tax Foundation Special Report No. 151 (March) (available at
http://taxfoundation.org/sites/taxfoundation.org/files/docs/sr151.pdf)
Citizens for Tax Justice (2014), “Who Pays Taxes in America in 2014?” (April 7) (available at
http://www.ctj.org/pdf/taxday2014.pdf)
Congressional Budget Office (2014), “The Distribution of Household Income and Federal Taxes, 2011,” (November)
(available at http://www.cbo.gov/sites/default/files/cbofiles/attachments/49440-Distribution-of-Income-and-Taxes.pdf)
Congressional Budget Office (2013), “The Distribution of Major Tax Expenditures in the Individual Income Tax
System,” (May) (available at http://www.cbo.gov/sites/default/files/43768_DistributionTaxExpenditures.pdf)
Cramer, Reid, Rachel Black, and Justin King (2012), “The Assets Report 2012: An Assessment of the Federal AssetBuilding Budget,” New America Foundation Asset Building Program (April) (available at
http://assets.newamerica.net/sites/newamerica.net/files/policydocs/AssetsReport2012.pdf)
Huang, C. and N. Frentz (2014), “What Do OECD Data Really Show About U.S. Taxes and Reducing Inequality?,”
Center on Budget and Policy Priorities (May 12) (available at http://www.cbpp.org/files/5-12-14tax.pdf)
Institute on Taxation & Economic Policy (2013), Who Pays: A Distributional Analysis of the Tax Systems in All 50
States, fourth edition (Washington, DC: ITEP) (available at http://www.itep.org/pdf/whopaysreport.pdf)
Mattera, P., K. Tarczynska, and Greg LeRoy (2014), “Tax Breaks and Inequality: Enriching Billionaires and Low-Road
Employers in the Name of Economic Development,” Good Jobs First (December) (available at
http://www.goodjobsfirst.org/sites/default/files/docs/pdf/taxbreaksandinequality.pdf)
Schuyler, M. (2014), “The Government’s Tax-Transfer System is Extremely Progressive,” The Tax Foundation
(December 5) (available at http://taxfoundation.org/blog/government-s-tax-transfer-system-extremely-progressive)
Week eleven (April 6)
How do labor market practices affect inequality?
DCJ/Bobo
Edmans, A. and X. Gabaix (2010), “What’s Right, What’s Wrong, and What’s Fixable: A Dispassionate Look at
Executive Compensation,” in Pathways: a magazine on poverty, inequality, and social policy, published by the
Stanford Center on Poverty and Inequality (available at
http://web.stanford.edu/group/scspi/_media/pdf/pathways/summer_2010/Edmans.pdf)
Meyerson, H. (2012), “If Labor Dies, What’s Next?” The American Prospect, volume 23, number 7 (Sep/Oct)
(available at http://prospect.org/article/if-labor-dies-whats-next)
McMillan, T. (2012), “As Common as Dirt,” The American Prospect, volume 23, number 7 (Sep/Oct) (available at
http://prospect.org/article/common-dirt-0)
Rosenfeld, J. (2010), “Little Labor: How Union Decline Is Changing the American Landscape,” in Pathways: a
magazine on poverty, inequality, and social policy, published by the Stanford Center on Poverty and Inequality
(available at http://web.stanford.edu/group/scspi/_media/pdf/pathways/summer_2010/Rosenfeld.pdf)
Week twelve (April 13)
Is inequality holding back the recovery and the economy?
JES chapters 3 and 9
DCJ/Stiglitz
Papadimitriou, D., M. Nikiforos, G Zezza, and G. Hannsgen (2014), “Is Rising Inequality A Hindrance to the Economic
Recovery?” Strategic Analysis, published by the Levy Economics Institute of Bard College (April) (available at
http://www.levyinstitute.org/pubs/sa_apr_14.pdf)
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Smeeding, Timothy (2012), “Income, Wealth, and Debt and the Great Recession,” in Recession Trends: A Great
Recession Brief, The Russell Sage Foundation and The Stanford Center on Poverty and Inequality (October) (available
at https://web.stanford.edu/group/recessiontrends/cgibin/web/sites/all/themes/barron/pdf/IncomeWealthDebt_fact_sheet.pdf)
Week thirteen (April 20) (Papers due/Oral presentations)
What policies are appropriate to address inequality?
JES chapter 10
DCJ/Altman and Kingson
Cohen, J. and C. Sabel (2009), “Flexicurity,” in Pathways: a magazine on poverty, inequality, and social policy,
published by the Stanford Center on Poverty and Inequality (spring) (available at
http://web.stanford.edu/group/scspi/_media/pdf/pathways/spring_2009/CohenSabel.pdf)
Davis, K. and K. Stremikis (2009), Eliminating Inequality in Health Care,” in Pathways: a magazine on poverty,
inequality, and social policy, published by the Stanford Center on Poverty and Inequality (winter) (available at
http://web.stanford.edu/group/scspi/_media/pdf/pathways/winter_2009/Davis.pdf)
Frank, R.H. (2008), “The Pragmatic Case for Reducing Income Inequality,” in Pathways: a magazine on poverty,
inequality, and social policy, published by the Stanford Center on Poverty and Inequality (winter) (available at
http://web.stanford.edu/group/scspi/_media/pdf/pathways/winter_2008/Frank.pdf)
Haskins, R. and I.V. Sawhill (2007), “Attacking Poverty and Inequality: Reinvigorate the Fight for Greater
Opportunity,” The Brookings Institution (available at
http://www.brookings.edu/~/media/Research/Files/Papers/2007/2/28poverty%20haskins%20Opp08/PB_Poverty_Haski
ns_Sawhill2.PDF)
Hochschild, J. (2010), “Fits and Starts? Obama and the Transformation of American Inequality,” in Pathways: a
magazine on poverty, inequality, and social policy, published by the Stanford Center on Poverty and Inequality (spring)
(available at http://web.stanford.edu/group/scspi/_media/pdf/pathways/spring_2010/Hochschild.pdf)
Institute on Taxation and Economic Policy (2013), “State Tax Codes as Poverty Fighting Tools: 2013 Update on Four
Key Policies in All 50 States,” (September) (available at http://www.itep.org/pdf/Poverty2013Report.pdf)
Page, M. (2014), “Are Jobs the Solution to Poverty?” in Pathways: a magazine on poverty, inequality, and social policy,
published by the Stanford Center on Poverty and Inequality (summer) (available at
http://web.stanford.edu/group/scspi/_media/pdf/pathways/summer_2014/Pathways_Summer_2014_Page.pdf)
Week fourteen (April 27)
In-class presentations
Week fifteen (May 4)
Final Examination
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INEQUALITY MEASUREMENT AND ISSUES
2. (week two: September 9)
Schiller chapters 2 and 4
Cole, Alan (2014), “Income Data Is a Poor Measure of Inequality,” Tax Foundation Special report No. 224 (August)
(available at http://taxfoundation.org/sites/taxfoundation.org/files/docs/SR224.pdf)
*Congressional Budget Office (2011), “Trends in the Distribution of Household Income between 1979 and 2007,”
(October) (available at http://www.cbo.gov/sites/default/files/cbofiles/attachments/10-25-HouseholdIncome.pdf)
Feldstein, Martin (1999), “Reducing poverty, not inequality,” The Public Interest, number 137 (fall), pp. 33-41
*
*Stone, Chad, Hannah Shaw, Danilo Trisi, and Arloc Sherman (2012), “A Guide to Statistics on Historical Trends
in Income Inequality,” Center on Budget and Policy Priorities (March 5) (available at
http://www.cbpp.org/files/11-28-11pov.pdf)
Distributional impacts of government fiscal policies
Taxes and the poor
Citizens for Tax Justice (2014), “Who Pays Taxes in America in 2014?” (April 7) (available at
http://www.ctj.org/pdf/taxday2014.pdf)
*The Institute on Taxation & Economic Policy (2013), Who Pays: A Distributional Analysis of the Tax Systems in
All 50 States, fourth edition (Washington, DC: ITEP) (available at http://www.itep.org/pdf/whopaysreport.pdf)
*Congressional Budget Office (2013), “The Distribution of Household Income and Federal Taxes, 2010,”
(December) (available at http://www.cbo.gov/sites/default/files/cbofiles/attachments/44604-AverageTaxRates.pdf)
*Furman, Jason (2006), “Tax Reform and Poverty,” Center on Budget and Policy Priorities (April 10) (available at
http://www.cbpp.org/files/4-10-06tax.pdf)
Gordon, Tracy (2012), “State and Local Budgets and the Great Recession,” Recession Trends: A Great Recession
Brief, The Russell Sage Foundation and The Stanford Center on Poverty and Inequality (December) (available at
https://web.stanford.edu/group/recessiontrends/cgi-bin/web/sites/all/themes/barron/pdf/StateBudgets_fact_sheet.pdf)
*
Johnson, Nicholas and Daniel Tenny (2002), “The Rising Regressivity of State Taxes,” Center on Budget and
Policy Priorities (January 15) (available at http://www.cbpp.org/archiveSite/1-15-02sfp.pdf)
*Scholz, John Karl (2007), “Taxation and poverty: 1960-2006,” in Focus, the newsletter of the Institute for Research
on Poverty at the University of Wisconsin-Madison, volume 25, number 1, (Spring-Summer), pp. 52-57 (available at
http://www.irp.wisc.edu/publications/focus/pdfs/foc251h.pdf)
Spending and the poor
Gais, Thomas and Lucy Dadayan (2008), “The New Retrenchment: Social Welfare Spending, 1977-2006,” The Nelson
A. Rockefeller Institute of Government (September 15) (available at
http://www.rockinst.org/pdf/workforce_welfare_and_social_services/2008-09-15the_new_retrenchment_social_welfare_spending_1977-2006.pdf)
*Johnson, Nicholas, Phil Oliff, and Erica Williams (2011), “An Update on State Budget Cuts: At Least 46 States
Have Imposed Cuts that Hurt Vulnerable Residents and Cause Job Loss,” Center on Budget and Policy Priorities
(February 9) (available at http://www.cbpp.org/files/3-13-08sfp.pdf)
*McNichol, Elizabeth (2012), “Out of Balance: Cuts in Services Have Been States’ Primary Response to Budget
Gaps, Harming the Nation’s Economy,” Center on Budget and Policy Priorities (April 18) (available at
http://www.cbpp.org/files/4-18-12sfp.pdf)
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Tax expenditures and the poor
Williams, Roberton (2011), “Who Benefits From Tax Expenditures?” Tax Facts from the Tax Policy Center,
(May 2) (available at http://www.taxpolicycenter.org/UploadedPDF/1001537-Who-Benefits-FromExpenditures.pdf)
Total distributional impacts of government fiscal policies
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