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Stone Center on Socio Economic Inequality

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Why Did the Rich Pull Away from the Rest? Paul Krugman, Understanding Inequality: Part I

by Paul Krugman July 7, 2025 Stone Center on Socio-Economic Inequality

Between World War II and the 1970s income disparities in America were relatively narrow. Some people were rich and many were poor, but overall inequality among Americans in terms of wealth, income and status was low enough that the country had a sense of shared prosperity. Things are very different today, as American society is beset by extreme inequality, economic fragmentation and class warfare.

What happened? The economic data show a huge widening of disparities in income and wealth starting around 1980, eventually undermining the relatively equal distribution of income we had from the ’40s to the ’70s. Moreover, growing disparities in income have led to growing disparities in political influence and the reemergence of what feels more and more like an oppressive class system.

The Importance of Worker Power. Paul Krugman, Understanding Inequality: Part II

by Paul Krugman July 14, 2025 Stone Center on Socio-Economic Inequality

I’ll now begin to flesh out that argument. For the most part, however, today’s primer will be about the drivers of rising inequality between 1980 and 2000. Why stop there? Because I need more space and time to adequately discuss the effects of “financialization” and the rise of giant tech fortunes, which mostly kicked in after 2000 and accelerated the concentration of wealth at the very top. I’m well aware that these are also the factors driving today’s headlines. But the surge in inequality before 2000 set the stage for the oligarchic moment we’re now experiencing.

I’ll discuss the following:

1. Why power is key to the inequality story
2. Unions and why they matter
3. The rise of the imperial CEO

A Trumpian Diversion. Paul Krugman, Understanding Inequality: Part III

by Paul Krugman July 21, 2025 Stone Center on Socio-Economic Inequality

Last week I promised that this week’s entry in my series of inequality primers would focus on the surge of giant fortunes since 2000. I’m going to break that promise and delay that entry, for two reasons. First, I’m still doing the research: high-end wealth inequality is not an issue I’ve worked on personally, so I need to do a lot of reading and talk to some specialists before weighing in.

But second, I have something more topical to discuss. This past week the GC CUNY Stone Center on Socio-Economic Inequality, my academic base, held its annual workshop on Inequality by the Numbers. Mainly this involved research presentations by young scholars, but as an over-the-hill-guy academic statesman I was asked to give a relatively non-technical talk about stuff currently on my mind.

Oligarchs and the Rise of Mega-Fortunes. Paul Krugman, Understanding Inequality: Part IV

by Paul Krugman July 28, 2025 Stone Center on Socio-Economic Inequality

Who said this? 

If there are men in this country big enough to own the government of the United States, they are going to own it; what we have to determine now is whether we are big enough, whether we are men enough, whether we are free enough, to take possession again of the government which is our own.

No, it wasn’t Bernie Sanders or Alexandria Ocasio-Cortez. It’s a quote from The New Freedom, Woodrow Wilson’s campaign platform in the 1912 presidential election.

Wilson was a vile racist, even for his time, and his reputation has suffered appropriately. But he was also a progressive on economic policy. And I’ve always been struck by the fact that in the early 20th century a politician could declare that great concentrations of wealth were a threat to democracy without being considered a radical, un-American Marxist. Wilson won that election!

Predatory Financialization. Paul Krugman, Understanding Inequality: Part V

by Paul Krugman August 4, 2025 Stone Center on Socio-Economic Inequality

The fact is that financialization of the U.S. economy has been a major driver of rising inequality. What do I mean by financialization? Actually I mean two different but related things. One aspect is the extraordinary rise in the share of the U.S. economy devoted to financial activities as opposed to production of goods and services. A second is the pervasive way in which financiers and financial institutions like hedge funds and private equity have changed how even nonfinancial business operates. These changes have almost always increased inequality.

I will discuss the following:

1.The growth of the financial sector and what explains it
2.How growth in finance directly increases income and wealth inequality
3.How the increased role of Wall Street has changed the way the rest of the economy operates

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Paul Krugman