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Opinion

Globalization Isn’t America’s Problem, Education Is

By Peter Henry

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The lack of equal access to higher education is a major obstacle to upgrading the overall skill level of the U.S. workforce.

By almost every measure imaginable, the American middle class has lost ground over the last three decades. Rising inequality, long-term unemployment and decreased job security have stoked angst over eroding fortunes, and with heightened anxiety comes the impulse to point fingers.

From fears in the 1980s over Japan’s investments in American landmarks to the more recent backlash against Chinese exports, globalization has long been an easy and popular target. But globalization per se is not the cause of stagnant middle- and working-class incomes or of rising inequality.

Globalization does indeed contribute to inequality, but not in the way that people typically think. Importing apparel, electronics and other consumer goods from countries like China and Mexico that can manufacture them more cheaply does not explain why the incomes of the top one percent have skyrocketed while others’ wages have flat-lined. For that we can thank the current ratio of high- to low-skilled workers in our country and the forces of supply and demand accelerated by technology.

Read full article as published in The Washington Post

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Peter Henry is the Dean of the Leonard N. Stern School of Business, Dean Richard R. West Professor of Business and William R. Berkley Professor of Economics & Finance.