But these ideas, say economists and other scholars, confront decades-old trends that will make it difficult to build a middle class that enjoys a far higher quality of life and sees significantly increased earnings.
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While he has addressed the issue throughout his presidency, Obama began late last year to shower even more attention on the importance of lifting middle-class wages. In the days after his address to Congress, he traveled the country to make arguments in favor of new investments in manufacturing, energy and college affordability.
But it is not clear that the measures — or any others — could compensate for the factors behind the decline of the middle class, including the rise of nations with abundant cheap labor and the development of new technologies that allow companies to operate with far fewer workers. Nor is it clear that the bruised American economy of 2012, with a growing population of retiring workers to support, can sustain a prospering middle class.
“There has been an avalanche of developments that have played out in the last 30 years or so that make it a huge challenge to think about real increases in wages and therefore a sustained rise in incomes,” said Lane Kenworthy, a sociologist at the University of Arizona. “I think, in truth, a lot of people are at a loss for what exactly can be done.”
Republicans, both in Congress and on the campaign trail, favor a far different approach than Obama has embraced. They generally regard government efforts to promote equality and strengthen the middle class as counterproductive. By this thinking, reducing taxes and shrinking the government’s role in the economy will free up capital that entrepreneurs can invest, creating good new jobs.
But Obama concluded that the Republican philosophy, which motivated the Bush administration, had proven ineffective. Middle-class earnings declined in the 2000s, while top earners saw their wealth skyrocket. These trends represented the culmination of nearly 30 years of expanding inequality in the country and a shrinking middle class.
To reverse the trends, which are related but not identical, Obama made changing the nation’s tax system a centerpiece of his agenda, proposing to raise taxes on the rich while reducing what the middle class pays. Obama has succeeded in offering middle-class tax relief, though so far only temporarily, but has failed in raising taxes on the wealthy.
But even economists who support making the tax code more progressive question how much it will do in the short term to lift the fortunes of the middle class and reverse inequality.