Robert Reich has posted Why Inequality Is the Real Cause of Our Ongoing Terrible Economy on his blog.  He starts the post with these paragraphs.

THE 5 percent of Americans with the highest incomes now account for 37 percent of all consumer purchases, according to the latest research from Moody’s Analytics. That should come as no surprise. Our society has become more and more unequal.

When so much income goes to the top, the middle class doesn’t have enough purchasing power to keep the economy going without sinking ever more deeply into debt — which, as we’ve seen, ends badly. An economy so dependent on the spending of a few is also prone to great booms and busts. The rich splurge and speculate when their savings are doing well. But when the values of their assets tumble, they pull back. That can lead to wild gyrations. Sound familiar?

The economy won’t really bounce back until America’s surge toward inequality is reversed.  …

These are ideas from his book “Aftershock: The Next Economy and America’s Future” For copyright reasons, I was unable to quote from his book in my previous blog post.