I'm Robert Reich, former Secretary of Labor, economic analyst, and star of the new film "Inequality For All." AMA.

Professor Reich, you are a noted supporter of free trade and outsourcing. From a neoliberal economics perspective, these policies are justifiable, but don't they dramatically undermine the bargaining power of the American working class?

Not if they're done correctly. For example, our trade treaties should require that our trading partners have a minimum wage that's half their nations' median wage (and we should do the same) -- thereby helping ensure that the benefits of trade are spread widely.

You appear to be a strong advocate for growing the economy as a way to pay off America's debt obligations. What are your thoughts on the idea that economic growth is ultimately unsustainable, given the accelerated depletion of key natural resources that would be required to fuel such growth?

Growth isn't the problem. It's what the growth is used for. Rich economies have healthier environments than poor economies in large part because they can afford to protect their environments. Productivity gains -- through invention and innovation -- will enable us to save more energy in the future. But we need a carbon tax to get incentives right.

Dear Professor Reich, I’m currently an undergrad at UC Berkeley (Go Bears!) and was wondering what made you decide you wanted to teach in Berkeley, of all places? Also, any word from O’Reily accepting your challenge to a debate yet?

I wanted to teach at an excellent public university with a wide diversity of students and incomes. Over 30 percent of Berkeley students are eligible for Pell grants, meaning they're from poor households. That's a larger number than the entire Ivy League.

Professor Reich,

Just wanted to let you know your Wealth and Poverty class has had more of an effect on my worldview than any other at Berkeley. Thank you!

Great! Now, see the movie!

I'm 42 and still paying off my own student loans, and my husband (who did not graduate from college) makes the same salary I do. All my degree has landed me is debt.

We will never be able to afford to pay for my kids to go to college, and I don't want them to end up 42, saddled with loans, etc.

Question: Is a college education still worth the investment?

It's still worth it -- college grads' lifetime earnings are about 60 percent higher than those without a four-year college degree -- but the "return" on a college investment is starting to decline. That's partly because college costs (and borrowing costs for college loans) are rising so fast, and also because more and more college grads are finding themselves in jobs that pay relatively little and for which they're overqualified. A troubling trend -- related to the larger issue of widening inequality.

On a slightly unrelated note, what was your favorite college experience?

I'd like to say it was my date with Hillary Rodham (now Clinton) but, to be honest, my favorite college experience was my fabulous classes in art history.

On this point, do you think there a correlation between the expansion of the Federally Backed Student Loan system combined with the decrease in direct government funding to colleges/universities and the massive increase in the cost of higher education? In other words, colleges and universities now know they can get more money in this system because the Fed will back student loans so they artificially inflate tuition costs in order to rake in money.

I've heard that said but haven't found evidence of it. College costs continue to rise faster than inflation because colleges are competing for star faculty and star students -- and that competition is ratcheting up all sorts of costs. Blame U.S. News and World Report.

What do the numbers look like for skilled trades versus those with degrees? Unionized skilled trades vs degrees? I'd presume the gap is far less severe if not near parity.

Further, I'm curious how the numbers look when the top 1% of each group are excluded from the data. Once the debt cost of education is accounted for I'm sure the gap closes further still and for some degrees probably sees unionized skilled trades surpass net wealth over a lifetime.

Certain skilled trades -- electricians and plumbers, for example -- are doing just as well as the median worker with a college degree. Also, demand is growing for technicians who have the training and skill to install, monitor, fix, and upgrade high-tech machinery.

Thanks for the reply. I'm afraid the decline will just continue, and when my son graduates high school in 2020 it will only be much much worse.

Maybe some major reforms will have happened in the student-loan/student-gauging industry by then.

I'm not holding my breath, however.

I'd prefer a system where no one was charged any tuition or fee for college -- and then paid 10 percent of his or her salary for the first ten years of full-time work into a fund that supported college costs.

Dr Reich I'd assume you'd agree that there was some value in studying - for the sake of knowledge and increased intellectual strategies - that goes beyond just the monetary aspect (important thought that is)

Of course! I wouldn't be doing what I'm doing as a college professor if I thought it was all about money. To me, the major purpose of a college education is to equip someone for a full and productive life, and, ideally, to enable someone to give even more back to society than he or she might otherwise be able to give.

What did you get a degree in?

I managed to avoid declaring an undergraduate major, but took lots of art history courses.

Hi, Dr. Reich. I'm a big fan of yours, and I'm eager to see this movie.

I encourage people to make small, everyday changes in their behaviors, like smiling at strangers, thanking people by name, and picking up litter. Things like this won't solve problems on a grand scale, of course, but I believe that these types of activities are necessary to restore trust in our culture, which I'm sure you know has been in decline since the mid-1960s. In my mind, tasks like these can make feel empowered to some extent, and could potentially turn the tide against pessimism and misanthropy in our country.

Unfortunately, I have been dismissed by some for promoting busy work or make work in my mission to bring people together. How would you respond to this criticism, assuming that you would agree with the need for smaller, locally-driven changes like these?

By all means, let's be more civil to one another -- especially to people with whom we disagree. (Bill O'Reilly calls me a Communist and won't even have the decency to debate civilly me about our differences.) In fact, one of the very best ways to learn about public issues is to discuss issues with people who have different political values and views than you.

Have you ever considered a presidential run, Mr. Reich?

No.

EDIT: Hell no.

Hi Professor. Why do you think so many working class and middle class Americans vote against their own interests and contribute to the widening gap between rich and poor?

Because they've been fed a steady stream of big lies emanating from Fox News, yell radio, and other mouthpieces of the radical right -- financed by billionaires like the Koch brothers who want to entrench their wealth and power.

Hey, I think you're one of the smartest guys..well..anywhere. So I want to pick your brain on something.

101-level economics IMO is one of the most foundational backbones of our intellectual culture...however it's painfully out of date. A lot of the assumptions are based around a supply-locked economy..that is demand outstrips supply...rather than a demand-based economy, where supply outstrips demand.

The way I see it, this entirely changes the models. Productivity gains go from being a good thing to a destructive thing, as an example as less labor becomes necessary wages go down, not up. Also, inequality breaks the notion of relatively linear supply/demand curves...making it that one can maximize profit by NOT maximizing production and sales.

Finally, there's the notion that as we've adopted a more technological...both in terms of production and management..business environment, that labor models based around "value-add" are horribly out of date.

So my question is. Am I full of crap? If so, why? And if not, is there any rumblings among economists to reform/edit 101-level Microeconomics into something that is based around a demand-locked economy?

Productivity gains are good, whatever the model (or your values) because such gains mean that a society has more capacity to do all sorts of things -- whether it's improving the environment or tackling poverty. The problem comes when most of the gains of productivity growth go to the very top of the income and wealth ladders -- in which case the vast middle class (and everyone aspiring to join it) don't have the purchasing power to buy what the economy is capable of producing. Most economic courses don't get into this. In fact, economics doesn't really dwell much on issues of inequality or distribution.

What do you like and not like about Obamacare? I recall you saying that it's not a perfect system, and I agree, but what are some of your major issues with the Affordable Care Act and what kind of healthcare system do you think would be best?

I'd prefer a single-payer system, or at least one in which people had the option of buying into Medicare. But given that we're not going to get this -- at least any time soon -- the Affordable Care Act is a step forward. It will have glitches and problems, to be sure -- just as Social Security and Medicare had glitches and problems initially. But it can be improved upon.

Robert Reich: In the current climate of global economies, what role do you think that forces outside our own economy is driving the current trends of inequality, and what meaningful steps can be taken to address issues such as living wages without simply re-distributing employment geographically?

I see a few major areas needing reform as soon as possible: (1) the minimum wage should be a living wage of $15 an hour; (2) the Glass-Stagall Act should be resurrected so Wall Street doesn't melt down again (and we need to cap the size of the biggest banks); (3) we need a progressive tax system such as we had between 1946 and 1980, where the top marginal rate is at least 70 percent; (4) we should use those revenues to invest in the best educational system in the world, including free early-childhood education, world-class K-12, and free university or technical education; (5) a single-payer health system, and (6) to get any of this done, we have to get big money out of politics.

If you could pick ONE public policy/program that you could implement in our country without having to fight politically to do it, what would it be?

I'm not sure there's much worth doing that doesn't require a political fight.

Robert - Two things I would like to ask you that puzzle me (and many others I won't ask). 1) What happened to make the working man turn against Unions and embrace the increasingly hostile right? It had to be more than integration because it had already started by then. People were proud leftists in the 30s and even into the 40s. What do you think? 2) Is the tea party smoke and mirrors? Is there actual enough people who would follow them to make them a real movement? I know they quote that a large percent are against ACA, but nearly 20% of that number are against it because it did not go far enough. So, are these guys actually a sustainable movement? Is it all Koch money and a slight of hand?

The right has used a divide-and-conquer strategy -- making the white working class believe that poor blacks and Latinos were taking away their jobs and using up their tax dollars, making non-union workers believe that unionized workers were getting paid too much and doing too little, making native-born Americans think immigrants were threatening their livelihoods, and making most working-class Americans believe that government was their enemy. The rest of us tended to remain silent when these lies began to poison our society. As to the tea party, I think much of it has been cooped by big money (Koch brothers, for example).

Have you ever had face-to-face discussions with members with the 1% and asked them what they thought about the income/wealth gap, and what they thought should be done, if anything? If so, what did they say?

Yes. In fact, one of the people interviewed in the film makes $10 to $30 million a year, and is convinced that he'd do far better if the vast middle class and poor had more money -- because then they'd be able to buy more of the stuff he makes.

Realistically, what are some policies that could pass this Congress that would be good for the country. We hear so much about what wouldn't pass, but where is there bipartisanship. I'd love your input, Professor.

I think the Democrats should introduce a bill to raise the minimum wage to at least $10.50/hour -- which is what it would be if the 1968 minimum wage had just kept up with inflation. The vast majority of Americans agree. Many Republicans would come along. It would be a worthy fight.

The "left" as a political movement is more or less dead in the United States. We just aren't seeing the kind of progressive mobilization that we did in the 1930s. What, if anything, can be done to revive it, and is the Democratic Party the proper vehicle for this given Obama's numerous disappointments and constraint by the system?

A new movement to take back our economy and democracy has to emerge from the grass roots -- and it will. It won't begin in Washington and it won't begin in the Democratic Party. It will happen when a sufficient number of people understand that the deck is stacked against them, and get organized and mobilized to change the rules of the game. I'm optimistic. Look at what's happening with fast-food workers and workers in big-box retailers, in terms of strikes and labor stoppages. Look at who's almost certainly to be the next mayor of New York.

Professor Reich, I am a big fan and looking forward to seeing the film. However, I believe the rich & powerful in this country actively DO NOT want a successful middle class in the U.S., because that means the laborers have too much power. (Also a reason why they're against Obamacare - health insurance binds people to jobs they hate.) As it is now, employees are scared to ask for raises and demand better working conditions. Multinationals can do better selling to China, India, Brazil etc. What can we do about this situation?

Look at American history and you'll see that the rich have done the best when everyone else is doing well. Today's rich would do far better with a smaller share of a rapidly-growing economy (growing because the middle class and poor had a larger share) than their currently large share of an economy that's barely growing at all. It's not a zero-sum game.

do you see a closing of the gap or will it only get wider?

We're coming close to a tipping point where, if income and wealth become any more concentrated at the top, the economy can't function (the middle class and poor don't have enough purchasing power) and our democracy can't function (so much money corrupts it from the top that the majority of Americans give up on it). So we have no choice, realistically, but to reform the system -- unless we want revolution.

Knowing what you know now, what would you have done differently as a member of President Clinton's cabinet?

I fought very hard for what I believe in -- a just and more equitable society, decent pay, an economic system in which anyone can make it with enough guts and gumption -- but I would have fought even harder. I allowed the conservatives and Wall Streeters in the administration to get their way too often.

Is it fair to say the cost of living is increasing at a faster rate than salary and if so how do we deal with that?

Another way of saying the same thing is that median household incomes are dropping, adjusted for inflation. They're 5 percent lower than they were at the start of the recovery in 2009. Meanwhile, 95 percent of the economic gains since the recovery began have gone to the top 1 percent.

I'm curious of something. You write, and do documentaries, about inequality yet speak in front of those advocating outsourcing. How do you square the two since outsourcing leads to lower wages(wage arbitrage)?

I'll speak to anyone who wants to know the truth, and I seek out people and groups who disagree with me initially.

Prof. Reich,

How I do I keep from getting cynical about the state of the nation (other than going to see your new film)?

First, see the film. Then take a deep breath and look at the demographics: Latinos, African-Americans, women, and young people are all becoming more politically active and powerful. They're far more progressive than the older white males who have dominated American politics.

What do you think is the biggest reason average people on the right want to keep taxes on the rich unfairly low?

They've bought into the supply-side lie that tax cuts for the wealthy trickle down to everyone else. But as everyone should be able to see, nothing has trickled down. In fact, the U.S. economy did better in the three decades when the top marginal tax rate was over 70 percent than it's done since Ronald Reagan and George W. Bush reduced taxes on the wealthy.

What are your thoughts about the role of the decline of labor unions in the increase in inequality over the last several decades, and what can be done to reverse that decline?

We have a chart in the film that shows an almost exact relation between the drop in the percentage of working Americans who are unionized, and the decline in the percentage of total income going to the middle class. It's quite remarkable.

I don't understand why the inequality gap is bad. Can you help me out?

I understand why we want a strong middle class, but that's a different question. Income inequality phrases the issue comparatively, and I don't see why we should care if some people become trillionaires.

Why does it matter that some people make so much more than others? shouldn't we focus more on helping the poor, without worrying about how well off some people are?

As our economy becomes more productive, it's capable of generating more goods and services (not just "stuff" but also better health care, recreation, etc.). But if 95 percent of the gains from productivity growth go to the top 1 percent, the rest of us don't have the purchasing power to buy what the economy is capable of producing at or near full employment. That means high unemployment, and dangerous cycles of boom and bust. Also, with concentrated income and wealth comes concentrated political power, with which the wealthy entrench their privileges, corrupt our democracy, and shift costs to everyone else.

Hi Robert!

I caught your spot on NPR yesterday on my ride home from work and thought your film sounded incredibly interesting. Now here you are doing an AMA, which is awesome.

As someone who has less than an armchair understanding of economics in general and America's current economic situation specifically, what's something that you think a lay-man like myself with no higher education should keep in mind when watching your film?

Does your film address how education is effecting our current situation? What about the political process and representation?

Thanks! I really look forward to finding a way to watch, both your trailer and your spot on NPR have gotten me intensely interested.

Good luck!

The film is designed to reveal what's really going on -- economically and politically. It's not a jeremiad. It doesn't hit you over the head or try to convince you of anything. In fact, what I'd like to do is bring people together, so we have a common understanding of our economic challenge. That's the start of fixing it. (Oh, and it's also entertaining!)

What is more difficult, being a professor at a major prominent university or trying to deal with AM conservative talk radio hosts?

The latter.

Hey Professor!

I took Wealth and Poverty two years ago and was so inspired that directly after graduation in May, I moved to DC, hoping to land a job in a place where I felt I could make a difference. While I know I am still young, I was wondering if you could give any insight on how to actually make an immediate difference, since DC is a very tough hierarchy to break.

Thanks for everything and I just wanted to let you know that your two hour Friday lectures completely changed my life.

You might consider going back to your home town and running for office.

Professor Reich,

I'm wondering which countries have come the closest to addressing wealth and income inequality in recent times, and have they used any means we would not be familiar with in the US?

And what are your thoughts on a tax assessed on overall wealth, rather than just income?

In the movie, I talk about the United States between 1946 and 1978 as an example of a society that successfully addressed and reversed widening inequality. Today, you might look at modern Germany -- where the top 1 percent takes home about 11 percent of total income, by contrast to the U.S. where the top 1 percent gets over 20 percent.

I am 27 and had to take out loans AND work full-time to put myself through undergrad at UCI. I have a decent job in the legal field, but I feel like my dreams of law school, home ownership and, you know, paying for my child's education (be it traditional higher education, trade/vocational school, etc.) will never be realized. I can't even afford the minimum payments required on my student loans and fear my economic growth is stunted under the weight of my crippling student loan debt. Advice? Did I screw up by going to college? Should my (future) children still be told that "college" is a must when most of the people I know who went to mechanical/trade schools are owning their own businesses and making several times what I am making right now? pls halp meeee. Also, you're one of the smartest people I've ever read and I have mad respect for you.

This nation needs to get out of the mindset that the only gateway into the middle class is a four-year college degree. We need to follow Germany's example and create a world-class system of technical education as well.

You're one of my heros, Dr. Reich. I read your book "Locked in the Cabinet" on a cross-country road trips a few years ago. As someone who works in legislative affairs, I believe the current political system's major problem to be campaign financing. Legislators are forced to raise large sums of money from corporations (and other special interests) in order to retain their jobs. When it comes time to take up pieces of legislation pertaining to complex policy areas, they go to the people they know, trust, and with whom they have a relationship -- often the lobbyists from their donating organizations. I know you are Chairman of the Board at Common Cause. What can we do to combat the influence of money in policymaking? I believe public financing of campaigns would be an amazing reform because elected officials are then beholden to taxpayers, not special interests.

Between 1974 (in reaction to the Watergate scandal) and 2004, we had a system of public financing of presidential elections that worked fairly well. At the very least, we need it back. Beyond this, I'd push for a system of matching contributions in which the government would provide a candidate with, say, $5 for every $1 raised from a small donor.

Mr. Reich, what do you think it will take for congress to begin looking closely and truly going after a solution to wage inequality?

Do you think that campaign finance reform will be necessary first, in order to level to the playing field, or do you think that lawmakers can be convinced to do things like reform the tax code and raise the minimum wage without a change in the way that money influences them?

We've got to get big money out of politics. It's poisoning our democracy. As the great Supreme Court jurist Louis Brandeis said in the late 19th century -- the last time we saw this kind of savage inequality -- we can have a democracy or we can have great wealth in the hands of a few, but we can't have both.

I'm 28 years old, born and raised in Gd Rapids, MI & I'm on disability. I own a duplex, living in one side and renting the other side out. SNAP is the only thing standing betwixt myself and starvation. If SNAP funding is cut, what recourse do I have?

The right believes that people on food stamps and disability don't want to work. That's one of their most venal lies. As I travel around the country I meet large numbers of people who rely on food stamps to live -- and many of these people work full time. If SNAP funding is cut, your state might have some income-assistance programs, but most states are still trying to cut spending. I wish I had a good answer for you.

Hi Robert!

I know that the USA is suffering from terrible economic inequality, but how can this trend be reversed? Is the notion of a 'global economy' mixed with the economic interests of the US incompatible with our historical standard of living? What actions can we take (besides voting) that can help improve the inequity in the US and the world?

Thanks again, and keep up the great work!

PS Here is a link about US economic inequality that I find deeply troubling: http://www.motherjones.com/politics/2011/02/income-inequality-in-america-chart-graph

Several steps can be and need to be taken -- I've outlined them above. If you (or anyone else on this thread) would like more details about how inequality can be reversed and what you can do to help, go to our website, inequalityforall.com.

Dear Secretary Reich, I attended your Occupy Berkeley rally speech as I was just wandering back to the library from Late Night (since I couldn't make my way past the 5,000+ supporters), and it made a profound impact on how I view social and economic inequality. I am looking forward to seeing the movie! Will there be any screenings in Berkeley (Wheeler Hall?) Also, did the Occupy Berkeley rally have any effect on you?

The movie is playing today at the California Theater.

And yes, the rally did affect me. I saw thousands of students who wanted to make a difference, and were fed up with how money has corrupted our democracy and determined to do something about it. I was inspired.

If you compared the graph of politically aware/active Americans or the graph of their political stance to the graph of American income/wealth, what do you think each would show?

People who are working all the time just to pay their bills don't have time to be politically active. And people who are unemployed or afraid of losing their job often don't want to make a ruckus. So, in a sense, keeping people at poverty wages, and maintaining a high degree of economic insecurity, are ways by which the moneyed interests have discouraged organized resistance.

Should I take a job with the IMF?

Sure.

Hello Professor,

Can you explain in laymen's terms how the Federal Reserve intends to off load its balance sheet of bonds & securities, and handle the excess reserves without causing inflation to rise substantially? I hear this complaint a lot from seemingly well-educated individuals, but I can't seem to figure out how the Fed (with such a diverse portfolio) is under pressure to offload its assets in a manner that would cause inflation.

Thank you for your time!

It's hard to find any evidence of inflation anywhere. Our biggest problem continues to be inadequate demand -- which, as I've noted, is related to our surging inequality. The Fed's bond-buying problem is helpful. If congressional Republicans were sane, and stopped their drive for austerity economics so we could have an expansionary fiscal policy as well, that would be helpful too. But the core problem is widening inequality. Expansionary fiscal and monetary policies are only band aides.

Professor Reich,

I am a recent college graduate, and I am a big fan. Before reading your books, I couldn't care less less about widening inequality-- I now see this issue as one of the biggest problems facing America.

However, if you look at history, you can see that inequality is a natural result of concentration on abilities (ie, Athens in 594BC and Western Roman Empire AD476). These civilizations have tackled the problem of inequality in their own ways, peaceful or violent. But all in all, inequality has been dealt with. Why? The market forces have had it that if the leaders do not reform, the people would revolt-- deeming redistribution of wealth an inevitable outcome. I think modern society is no different than the ones who came in the past, and if our history serves us correctly, such "natural" market occurrences will be fixed by a subsequent period of redistribution.

My point is, wealth concentration and redistribution are parts of natural economic cycles. Thus, raw market forces are considerably stronger than any political movements. I think the redistribution is due, sooner or later. The bigger question seems to be: when are we going to reach a threshold where people would rise up (and I believe you are playing an essential role in pushing towards this threshold) and how can we make sure that the redistribution would be a peaceful one?

Any thoughts would be highly appreciated!

Disagree about "natural result of concentration of abilities." The fact is, there are millions of poor and working-class kids in America right now with extraordinary talents and abilities but their schools have too few resources, they're crowded into classrooms with more than 30 other kids, their teachers have to spend a lot of time keeping order, many children come to school without having eaten a meal the evening and morning before, others have toothaches because they have no access to dentists. Do you see where I'm going? Don't buy into this baloney about natural concentration of abilities.

It seems that the largest barrier to dealing with income inequality is the Republican party.

How would you advise the President in dealing with the Republican party's insane obstructionism? What can we as concerned citizens do to get these people out of office?

Look at every district with a Republican member of Congress, where a more progressive/Democratic challenger in 2014 might have a chance. Then go there and start organizing.

What's the deal with you and Alan Simpson being buds? Seems odd given his affiliation with the Fix the Debt crowd, which for all intents and purposes runs counter to your message on inequality.

I disagree with Alan on almost everything. But I like him. He's a close friend. It is possible to profoundly disagree with someone but still like them.

Mr. Reich, I really like your insight into the political/social/economic situation we are in today in America. My questions is: What do you needs to be the next step to help put our country back on good economic footing?

I've outlined above some of the policies we need. But we'll never get them unless and until the public demands them. In other words, we need to have active, engaged citizens that demand them.

The US, throughout most of its history, had tariffs that brought in a large share of federal revenues but also protected American industries. Is it time that we stopped crucifying ourselves on the cross of "Free Trade" and at least put up barriers to protect targeted industries? ...also (but related): Chinese friends studying in the US often buy products manufactured in China here because they are cheaper!

Every large American-based company is now global. If we put up tariffs, and forced them to make more of their stuff here, they'd jack up their prices. Americans might have more jobs at higher wages, but the cost of everything would be much higher.