Economy’s Inequality Worsens: Peter Atwater on K-shaped Recovery and the Need for a Healthier Economy

During the COVID-19 recession, many economists predicted that the United States’ economic recovery would follow a K-shaped pattern. This meant that high-income Americans would bounce back quicker than those at the lower end of the income scale. However, as Peter Atwater, who coined the phrase “K-shaped recovery,” warns, economic inequality in the US has worsened since the pandemic recovery began. While some low-wage workers have seen wage gains, this only tells part of the story. Atwater discusses the risks of allowing a K-shaped economy to continue unchecked and shares his thoughts on which letter of the alphabet would best represent a healthy economy.

In addition to discussing economic recovery, the show also examines an Oklahoma Supreme Court decision regarding a publicly funded religious charter school and delves into global shipping supply chain issues that may be influencing Federal Reserve decisions on interest rates.

One listener shares their experience of adapting their home to accommodate living with friends, and a happy wedding anniversary is extended to Susanna. The show encourages audience participation through questions and comments sent to makemesmart@marketplace.org or through voicemails to 508-U-B-SMART.

Economists have been describing America’s economic recovery as K-shaped since the onset of COVID-19. According to Peter Atwater, who coined this term, high-income Americans were able to bounce back quicker than those at the lower end of the income scale during this time. However, Atwater warns that economic inequality in America has become even more pronounced since then.

Atwater discusses how some low-wage workers have seen considerable wage gains but that this does not tell the whole story. He emphasizes that it is crucial for policymakers to address economic inequality if they want a sustainable economy in America.

The show also explores other topics such as an Oklahoma Supreme Court decision regarding a publicly funded religious charter school and global shipping supply chain issues that may be influencing Federal Reserve decisions on interest rates.

One listener shares their experience of adapting their home to accommodate living with friends while another couple extends congratulations on their happy wedding anniversary.

The show encourages audience participation through questions and comments sent to makemesmart@marketplace.org or through voicemails to 508-U-B-SMART.