Obama sees income inequality as 'bad economics'

Income inequality is on the rise. Between 2009 and 2011, the incomes of the wealthiest seven percent of Americans grew by 28 percent, while the rest of the country's incomes dropped by four percent, according to Pew Research.

President Barack Obama brought income inequality into the spotlight during a recent speech in Galesburg, Ill.

"This growing inequality is not just morally wrong, it's bad economics," Obama said in his speech. He told The New York Times, "If we don't do anything, then growth will be slower than it should be. Unemployment will not go down as fast as it should. Income inequality will continue to rise. That's not a future that we should accept."

Richard Burkhauser, public policy professor at Cornell University and adjunct scholar at the American Enterprise Institute, has a different take on the numbers.

"Burkhauser has come up with statistical findings that not only wipe out inequality trends altogether but also purport to show that over the past 18 years, the poor and middle classes have done better, on a percentage basis, than the rich," writes Tom Edsall in The New York Times.

Burkhauser and Jared Bernstein, senior fellow at the Center on Budget and Policy Priorities, join The Daily Circuit to discuss what income inequality means and what should be done to address it.

LEARN MORE ABOUT INCOME INEQUALITY

• Income inequality is far from benign
Daily Circuit guest Bernstein writes for Salon, "I've come to see the consequences of our inequality problem as running deeper, striking at opportunity and mobility in a manner that should cause grave concern among anyone who's paying attention, regardless of their political stripes. There is nothing benign about it."

• What if We're Looking at Inequality the Wrong Way?
Tom Edsall looks at Burkhauser's research for The New York Times.

• Inequality in America: The Data Is Sobering
"The problem is that weaving modest policy proposals through the tiny spaces allowed by the nation's partisan stalemate is unlikely to bear much fruit. A better strategy might be to articulate -- forcefully -- the nature of the problem and build a political consensus that would ultimately lead to long-delayed changes to American society." (Eduardo Porter in The New York Times)

• Even as economy rebounds, income inequality festers
"While official Washington may not like to admit it, the policies that have contributed to the squeeze on the middle class and the poor have had ample support in both parties." (CBS MoneyWatch)

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