Thursday Evening Links

This and that for your Thursday reading.

- Colin McAuliffe charts the increasing share of U.S. income going to profits and the already-wealthy. And Dani Rodrik writes about the importance of a progressive movement which seeks to shift the balance of power in how our economy functions, rather than settling for trying to redistribute wealth concentrated in the hands of a few:

There is now growing recognition that tax-and-transfer policies can go only so far. While there is much room for improving social insurance and tax regimes, especially in the US, deeper reforms are needed to help level playing fields in favor of ordinary workers and families across a broad range of domains. That means focusing on product, labor, and financial markets, on technology policies, and on the rules of the political game.

Inclusive prosperity cannot be achieved by simply redistributing income from the rich to the poor, or from the most productive parts of the economy to less productive sectors. It requires less-skilled workers, smaller firms, and lagging regions to be more fully integrated with the most advanced parts of the economy.

In other words, we must start with productive re-integration of the domestic economy. Large and productive firms have a critical role to play here. They must recognize that their success depends on the public goods that their national and sub-national governments supply – everything from law and order and intellectual property rules to infrastructure and public investment in skills and research and development. In exchange, they must invest in their local communities, suppliers, and workforce – not as corporate social responsibility, but as a mainline activity.

- David Sirota examines how Wall Street funds exacerbated the housing crisis arising from the 2008 financial crash. Alexander Sammon points out the plight of communities which offer massive incentives based on the promise of corporate jobs - only to find that those fall far short of producing any security or prosperity for residents. And David Macdonald writes that while Canada's first social impact bonds predictably produced plenty of profits for consultants and advisors, they were grossly inefficient in trying to improve social outcomes (with 60% of funding getting diverted from the supposed end goal).

- Wanyee Li rightly notes that in the wake of a series of deaths of homeless people trying to find warm clothing in donation bins, the core solution is to work on reducing poverty and homelessness - not to merely restrict access to the bins.

- Finally, Andre Picard discusses the predictable breakdowns in a health care system which is understaffed over the holidays when resources are needed most.