No. of Recommendations: 1
There are some decent arguments that America's serious economic inequality is partially responsible for the situation in which we find ourselves - and that at the same time our inequality is making it even more difficult to overcome the barriers to needed growth.

...In economically unequal countries, political power may be distributed in a more egalitarian fashion than economic power. Efforts to use this political power to effect redistribution, say, through the tax system, may create disincentives to investment and result in lower or less durable growth (Alesina and Rodrik, 1994). Meanwhile, efforts by economic elites to resist this redistribution, for example, through vote buying and other corrupt behavior, itself could be distortionary and wasteful and thus also detrimental to growth (Barro, 2000).

Page 9, IMF Staff Discussion Note: "Inequality and Unsustainable Growth: Two Sides of the Same Coin?"

Sounds a bit like the Fiscal Cliff negotiation, doesn't it?

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