Yesterday's news reported that Bernanke repeated his mantra that the best solution for income inequality is more education and training, not "protectionism."
Income inequality is not some abstract side effect of the complex economy, it is the result of government policies and of choices made by people in powerful positions in business and government. As Bernanke himself has observed, productivity in manufacturing has increased significantly in the last few years. This is due in large part to what Ross Perot called the 'giant sucking sound' of manufacturing jobs being sent to low wage countries, and attacks on workers' wages for the jobs that remain. The effect of "free trade" on income inequality is obvious to most, although a Wall Street shill like Bernanke knows better than to admit it.
Tax policies that favor the wealthy are another obvious contributor to income inequality.
If lack of education is the culprit for the increasing income inequality that we have seen over the last 25 years, one would expect that there would be some evidence that people have been lacking in education. I have not yet researched this topic, but I suspect that it will show that the percentage of students attending and graduating from college and earning advanced degrees has increased over this time.
Bernanke argues that in an increasingly technological culture, income inequality is likely to rise due to the increasing marginal benefit of education. That may be the case, but the real world is not a controlled experiment where the only changing variable is technological complexity. The real world includes multiple policies, supported by him and his comrades, that generally promote income inequality. But Bernanke ignores all these and focuses on education as the solution. This has the added effect of guilt tripping people into think their imperfect education has led to their economic struggles. Bernanke insults everyone's intelligence by promoting this crap.
One more point. I am not suggesting that y'all drop out of school. As an individual trying to get by in this society, I completely agree that more education is better. You do have to consider the cost and benefits of particular schools and courses of study carefully (I wouldn't take out a 6 figure debt for a psych degree from Duke), but the benefits of education are clear. There is a difference, however, between an individual deciding how to survive in a society, and a decision maker pontificating about how that society should organize itself. Bernanke is doing the second, and as a policy maker, he is not even going to try to address income inequality. Mr. Bernanke, we need humane policies, not social darwinist lectures.
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