Roger Altman: The U.S. Needs a More Progressive Income Tax System and More Public Investment in Education
By coincidence, exactly what I told my Econ 1 students yesterday:
No more inaction on income inequalitym: Two solutions stand above the rest. The US needs a more progressive tax system and one that raises more revenue. The latest data reveal that the top 1 per cent of earners got 93 per cent of all increases in after-tax personal income in 2010. That reflects, among other things, low effective tax rates for much of this group, which are largely explained by the high percentage of their income that consists of capital gains and dividends…. In the longer term, it is imperative to raise education levels. This means better secondary-school completion rates, which lead to increased university attendance. And it also means higher university completion rates, with the greater lifetime earnings that follow. In America, wide-ranging public school reforms are necessary to achieve the first goal, including better methods for teacher training, evaluation and compensation, improved curriculums and upon graduation, as a minimum, assured admission to community colleges. Fortunately, this reform movement is finally showing some signs of life. We need a big initiative to make university affordable and inclusive.
These steps are not impossible. Far from it. They are readily attainable with the right leadership. Mr Obama’s welcome focus on the problem should now be coupled with genuine solutions.