What changes income distribution? Does tax policy change it?
KRUGMAN: A major tax cut would change it. Ronald Reagan was for the most part unsuccessful in cutting taxes. Income taxes went down, but social security and other contributions went up. For 99 percent of the population there was basically no change in the tax rate. But the top one percent got a significant break. Those same people who got most of the growth. As a political position, I think the United States has a lot of unfinished business. We need to spend more money on education, we need to spend more money on childcare, we need to spend more money on infrastructure, we need to reduce our budget deficit and I think it makes sense to get a significant portion of that money by taxing that top one percent that has been doing so well. CHASE: You say in The Age of Diminished Expectations that Americans have been doing less well and not protesting very much about it. KRUGMAN: Yes. That’s the double entendre of the title. I think we’re having a revolution of diminished expectations. CHASE:
