Some of the best policies to increase social mobility and reduce income inequality can be framed as needing to separate short-term interventions versus long-term interventions. It behooves and is advantageous for society to ensure that every member of society is living at some basic level of income. The public policy interventions there tend to be around transfers and minimum wages. But longer term, you need to invest in education and infrastructure. And here, in the U.S. in particular, there has been an underinvestment in quality education. On a dollar basis, education spending is up, but the quality of education outcomes has deteriorated significantly.
To put it in context, the OECD has a very scary statistic that this generation of Americans, for the first time in the 300-year history of the United States, is the first generation that will be less educated than the preceding generation. This is quite damning. And it’s not just about the United States growing — it’s about the global economy too. Many countries depend on the United States to be a leader, especially in things like R&D.