What Does the Rising Tide Bring?
Robert B. Williams
Chapter Chapter 2 in Toward a Good Society in the Twenty-First Century, 2013, pp 23-47 from Palgrave Macmillan
Abstract Since coined by President Kennedy in 1963, economic growth has been likened to “a rising tide that lifts all boats” (Kennedy, 1963), thereby evoking a picturesque harbor where yachts and skiffs alike rise with the incoming tide. Yet, the importance of this clever aphorism goes beyond its pithy and vivid depiction. Within neoclassical economics, economic growth represents the surest means to alleviate poverty. According to this view, sustained economic growth offers new opportunities to entrepreneurs and business owners as they respond to the surging demand by hiring new employees. During prolonged expansions, these employment gains can extend through all neighborhoods, even reaching those last to be hired. The resultant expansion of incomes from rising profits and payrolls underwrite further spending that fosters additional production and employment in a self-sustaining manner. Rising incomes permit households to accumulate wealth as each works toward its version of the American Dream. Indeed, economic growth can yield a surge of opportunities that extends material prosperity through all parts of our communities. It can bring opportunity and lift the hopes of those who are often neglected and left stranded.
Keywords: Household Wealth; Wealth Quintile; Household Asset; Consumer Finance; Wealth Accumulation (search for similar items in EconPapers)
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