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Widening Income Gap 'Concerns' Obama

Oct 1, 2013
Originally published on October 1, 2013 6:35 am

Transcript

STEVE INSKEEP, HOST:

In our talk yesterday with President Obama, he said he will not make concessions to Republicans who quote, "threatened to burn down the house." We are hearing parts of the interview throughout today's program.

Amid the latest political crisis, our economy keeps evolving. And so we used part of our conversation in the Oval Office to ask the president about the longer term trends.

You've talked a lot during your time in office about the widening gap between the rich and everybody else. This is a decades-long trend. But a good part of that trend has now taken part - taken place on your watch. There was a study I was reading: 2009 to 2012, overwhelming majority of the increase in income in this country went to the wealthiest 1 percent. Why is that happening on your watch?

PRESIDENT BARACK OBAMA: Well, it's one of my biggest concerns. And part of it has to do with the fact that these long-term trends have accelerated. Globalization, combined with technology, have stripped away a lot of the basic security that middle-income people had because a lot of those middle-income jobs have left. Either they were moved overseas, they were replaced with technology - whether you're talking about a bank teller; a travel agent; a high-level administrator in a lot of companies; if you go to many manufacturers, it's all robotized. So some of the - that's part of the trend. But...

INSKEEP: Are your efforts not helping with this?

OBAMA: Well, there's no doubt...

INSKEEP: The law was passed under a Democratic Congress.

OBAMA: Well, no - there are no doubts that what we've done has helped. So for example, the changes we made in the tax law that increased taxes on the wealthiest Americans while locking in tax cuts for middle-class Americans, that helped. That made the tax system more progressive.

INSKEEP: The economist Tyler Cowen was on our program the other day. He'd written a book about income inequality. And he argued, based on his analysis, that it's really inevitable, it's going to get worse, and the thing for public officials to do is to adapt to it rather than try to change it.

OBAMA: Well, I don't accept that. America is always been at its best when everybody who's willing to work hard has a chance to succeed. There is no doubt that these trends are powerful and they're global. I mean, we're seeing the same trends in Scandinavian countries that historically were - prided themselves on great equality. We've seen it magnified in less developed countries and emerging markets. So these are global trends that we're going to have to fight against.

But if we are educating a workforce that has the skills they need to compete, if we have a tax system that is fair and not rewarding those who can afford high-priced accountants and lawyers, if we are rebuilding our infrastructure in this country, not only to make us more competitive but because those create jobs that can't be exported, if we are increasing a minimum wage so that it's reflective of the same purchasing power that existed many years ago, if we're creating more ladders of opportunity for people who are locked in neighborhoods that have been abandoned and small towns where factories have closed - if we do those things, then we can lessen the impact of these broader market forces.

But what is true is that globalization and technology are a mixed bag. On the one hand, they create a situation in which consumer goods are cheap and they create a situation in which we can have access to goods and services that we would never have had before. On the other hand, it does create a situation in which a lot of the jobs that are created are at the very top, high-skilled, you know, creative work that can't be replicated; or at the bottom, low-skilled jobs. What we don't have are those jobs in the middle that we have to really focus on building, because we can out-compete anybody when we have smart policies.

INSKEEP: And that's part of our interview with President Obama yesterday afternoon at the White House.

Elsewhere in the program, he talks about the government shutdown in the debt ceiling fight to come. And you can find a transcript of the full interview at ngr.org.

(SOUNDBITE OF MUSIC)

INSKEEP: This is NPR News. Transcript provided by NPR, Copyright NPR.