From the Director
Thea Harvey

Johan Galtung says that defining peace as the absence of war is too negative, in the same way that health is more than the absence of disease. His definition of “positive peace” includes harmony, co-operation, and integration. I wonder whether we can think of economic opportunity in the same way. We have structures that guarantee each person equal opportunity under the law. This would be negative opportunity; there is “officially” nothing standing in your way. Perhaps we can have a system that actually encourages cooperation and integration.

Bill Clinton recently said, "It turns out that advancing equal opportunity and economic empowerment is both morally right and good economics. Why? Because poverty, discrimination and ignorance restrict growth. When you stifle human potential, when you don’t invest in new ideas, it doesn't just cut off the people who are affected; it hurts us all."

The issue of inequality is a central one in this year’s US presidential race. Should we be taxing the very rich more, or giving them tax breaks? Whom should we tax and how much, in order to create jobs — the point of job creation being (presumably) to lower inequality? Some even ask whether a very rich president-elect can truly understand the needs of the middle class and the poor.

To look at these issues we bring you articles by two of the leading thinkers on inequality. Joseph Stiglitz, whose latest book is The Price of Inequality: How Today's Divided Society Endangers Our Future, writes, “To fix the economy, we must boost demand. To do that, we have to address inequality.” James Galbraith’s latest book is Inequality and Instability: A Study of the World Economy Just Before the Great Crisis. In this issue of EPS Quarterly, he brings us “A few comments from the front lines.”

In addition to these political and policy-oriented questions, I thought we should ask whether there is a relationship between inequality and conflict or violence. Many members of Economists for Peace and Security have looked at the effects of war and violence on the economy and social stability, but can we see a correlation or even a causal connection in the other direction? Does inequality contribute to the conditions that lead to conflict?

Research from the Institute for Economics and Peace shows that America's high income inequality strongly correlates with high rates of violence. Frances Stewart, recently awarded Tufts University’s Global Development And Environment Institute 2013 Leontief Prize for Advancing the Frontiers of Economic Thought, writes about inequality between groups rather than individuals, and demonstrates how “horizontal inequalities...galvanize group action to address actual or perceived inequalities.”

Recently, Robert Reich commented on NPR, “For 30 years, median real wages have barely increased, and over the last decade they've dropped — even though the productive capacity of the economy has soared... [Business leaders and entrepreuneurs] won't create more jobs without more customers... We're caught in a trap of our own making that defies the standard remedies. Neither Keynesian stimulus nor supply-side tax cuts...will restore buoyant job growth...“The fact is that unless we can get the economy back to the balance it achieved 30 years ago, when the middle class and those aspiring to join it received a much larger share of the economy's gain, we simply can't get back on track.”

I like Dr. Reich’s explanation of why neither the Democratic nor the Republican solution has been terribly successful. While I certainly don’t have the magic answer, we can see why inequality is such a very important issue to address.