Opinion

Concrete Steps Can Reduce Inequality

A minimum-wage hike, better preschools, apprenticeships, paid family leave, and a low-cost retirement savings plan can change the course for those Latinos overrepresented in low-wage occupations.

Ben Olinsky, a senior fellow at the Center for American Progress, focuses on economic issues. He holds a political science degree from Yale University.
National Journal
Ben Olinsky
Add to Briefcase
Ben Olinsky
Feb. 25, 2014, 11:55 p.m.

Let’s face it: Most of us dream of a world where in­equal­ity would be a for­eign concept. Un­for­tu­nately for us, in­equal­ity is our real­ity. We can see in­equal­ity every­where, while walk­ing down the street or go­ing to the mall. For Lati­nos in the United States, eco­nom­ic in­equal­ity can be seen in the His­pan­ic poverty rate, which re­mains stub­bornly high at 25.6 per­cent com­pared with the 9.7 per­cent poverty rate for whites.

While these num­bers may seem quite dis­cour­aging, it is im­port­ant to keep in mind that we can take con­crete steps to de­crease in­equal­ity and re­store an eco­nomy that works for every­one, not just the wealthy.

As Pres­id­ent Obama men­tioned in his State of the Uni­on ad­dress, fo­cus­ing on in­creas­ing eco­nom­ic op­por­tun­ity in the United States, both in the short and long term, will be a pri­or­ity in 2014. This past Decem­ber, Pres­id­ent Obama ex­plained his views on in­equal­ity in a speech presen­ted by the Cen­ter for Amer­ic­an Pro­gress, ar­guing that re­du­cing in­equal­ity goes hand in hand with work­ing to im­prove the coun­try’s eco­nomy. In fact, the pres­id­ent re­minded us that there is good evid­ence that the eco­nomy grows best when the en­tire pop­u­la­tion be­ne­fits, not just some parts of our so­ci­ety.

There are sev­er­al key policies that the U.S. could ad­opt that would put this goal with­in reach, start­ing with pro­pos­als to in­crease the min­im­um wage from $7.25 to $10.10 and set­ting it to auto­mat­ic­ally in­crease over time. Do­ing so would dir­ectly ad­dress in­equal­ity and would dis­pro­por­tion­ately be­ne­fit Lati­nos, who are overrep­res­en­ted in low-wage oc­cu­pa­tions. Al­though CEOs’ salar­ies have gone up dra­mat­ic­ally, earn­ing 273 times more today than av­er­age work­ers, the wages of av­er­age work­ers have been stag­nant. In­creas­ing the min­im­um wage will help de­crease this gap.

The math is simple: When em­ploy­ees are paid more, they spend more, thus in­creas­ing the de­mand for goods. This, in turn, leads com­pan­ies and busi­nesses to do bet­ter, al­low­ing them to hire more work­ers and to pay high­er wages.

As the pres­id­ent also men­tioned in the State of the Uni­on, mak­ing sure that all chil­dren can at­tend high-qual­ity preschool is in­cred­ibly im­port­ant to their lifelong suc­cess. Ac­cord­ing to re­search, about half of the dif­fer­ence in high school achieve­ment can be ex­plained by a child’s ex­per­i­ences be­fore the age of 5. Ac­cess to high-qual­ity preschool is es­pe­cially im­port­ant for low-in­come chil­dren of col­or, who of­ten be­gin kinder­garten be­hind their peers. By provid­ing ac­cess to high-qual­ity preschools, we can give all chil­dren the ne­ces­sary skills to suc­ceed in school, gradu­ate from high school and col­lege, and have bet­ter op­por­tun­it­ies to find and keep jobs that pay well as adults.

We also must cre­ate more op­por­tun­it­ies for all stu­dents to learn and gain mar­ket­able skills after high school. One way to do this is by cre­at­ing more ap­pren­tice­ships op­por­tun­it­ies, where young adults and stu­dents can earn an in­come, gain work ex­per­i­ence, get train­ing, even earn col­lege cred­it. Re­search has shown that com­pared to work­ers who have not done ap­pren­tice­ships, those who com­plete an ap­pren­tice­ship earn an av­er­age of $300,000 more in wages and oth­er be­ne­fits over their life­times.

Ap­pren­tice­ships also help com­pan­ies by provid­ing skilled and ex­per­i­enced work­ers to fill pro­jec­ted job open­ings. And the time has come for us to give stu­dents the op­por­tun­ity to re­fin­ance stu­dent loans, which will in­crease re­pay­ment, free­ing up that money to be spent in oth­er ways that could boost the eco­nomy.

One of the most im­port­ant ways we can be­gin fight­ing in­equal­ity is to con­cen­trate on people’s lives at home and of­fer­ing paid fam­ily leave for every­one. Today, only 12 per­cent of work­ers have paid fam­ily leave through their em­ploy­ers, and low-wage work­ers are par­tic­u­larly un­likely to have it. We can start to level the play­ing field by giv­ing all par­ents — not just the lucky few — bet­ter op­por­tun­it­ies to care for their chil­dren, which can res­ult in bet­ter suc­cess in school.

Fi­nally, with only half of all Amer­ic­ans hav­ing a re­tire­ment plan at work, we have to com­bat in­come in­equal­ity in re­tire­ment. To do so, we should give all work­ers a new low-cost op­tion to save for re­tire­ment that would en­joy low fees, pooled risk, and pro­fes­sion­al fund man­age­ment. We should also change how the tax code works so the wealthy do not get bet­ter tax breaks than low-in­come fam­il­ies to save for re­tire­ment.

It won’t be easy to turn back in­equal­ity, but there are steps we can take now to move in the right dir­ec­tion. If we can cre­ate an eco­nomy that works for all Amer­ic­ans, we can un­leash our full eco­nom­ic po­ten­tial. Let’s give work­ing Amer­ic­ans a raise, chil­dren the sup­port and edu­ca­tion they need, young adults the skills that can help them land a good middle class job, and work­ers the chance to save for re­tire­ment. As Pres­id­ent Obama ex­plained, if we work to­geth­er, we won’t just cre­ate a more equal so­ci­ety, we’ll cre­ate a more pros­per­ous one as well.

AN OPIN­ION ON POLICY AND CHAN­GING DEMO­GRAPH­ICS?

The Next Amer­ica wel­comes op-ed pieces that ex­plore the polit­ic­al, eco­nom­ic and so­cial im­pacts of the pro­found ra­cial and cul­tur­al changes fa­cing our na­tion, par­tic­u­larly rel­ev­ant to edu­ca­tion, eco­nomy, the work­force and health. Email us. Please fol­low us on Twit­ter and Face­book.

What We're Following See More »
PAC WILL TARGET INCUMBENTS
Sanders Acolytes Taking the Movement Local
28 minutes ago
WHY WE CARE

"While Democrats nationwide have put the focus on President Trump, the Sanders wing of the party has engaged in an intramural fight to remake the party in a more populist, liberal mold." From Washington state to California to Florida, Sanders loyalists are making good on their promise to remake the party from the ground up. And just last week, a "group of former Sanders campaign aides launched a super PAC with the explicit goal of mounting primary challenges to Democratic incumbents."

Source:
THANKS TO MILITARY ROLE
McMaster Requires Congressional Approval
41 minutes ago
THE DETAILS

Congress will need to vote on Donald Trump's pick of Lt. General H.R. McMaster to be his next national security adviser, but not for the reason you think. The position of NSA doesn't require Senate approval, but since McMaster currently holds a three-star military position, Congress will need to vote to allow him to keep his position instead of forcing him to drop one star and become a Major General, which could potentially affect his pension.

Source:
THE QUESTION
How Many Signatures Has the Petition for Trump’s Tax Returns Received?
4 hours ago
THE ANSWER

More than 1 million, setting a record. More than 100,000 signatures triggers an official White House response.

Source:
SENT LETTERS TO A DOZEN ORGANIZATIONS
Senate Intel Looks to Preserve Records of Russian Interference
4 hours ago
THE LATEST

"The Senate Intelligence Committee is seeking to ensure that records related to Russia’s alleged intervention in the 2016 U.S. elections are preserved as it begins investigating that country’s ties to the Trump team. The panel sent more than a dozen letters to 'organizations, agencies and officials' on Friday, asking them to preserve materials related to the congressional investigation, according to a Senate aide, who was not authorized to comment publicly. The Senate Intelligence Committee is spearheading the most comprehensive probe on Capitol Hill of Russia’s alleged activities in the elections."

Source:
MORE COOPERATION WITH LOCAL AUTHORITIES
Deportation, Detention Rules Released
4 hours ago
THE DETAILS

Memos issued by the Department of Homeland Security on Tuesday night "implemented sweeping changes to the way immigration policy is enforced, making clear that millions of people living illegally in the U.S. are now subject to deportation and pushing authorities to fast-track the removal of many of them. ... The policy calls for enlisting local authorities to enforce immigration law, jailing more people while they wait for their hearings and trying to send border crossers back to Mexico to await proceedings, even if they aren’t Mexican."

Source:
×
×

Welcome to National Journal!

You are currently accessing National Journal from IP access. Please login to access this feature. If you have any questions, please contact your Dedicated Advisor.

Login