What many economists fail to understand is that poor people are no less concerned about improving their lot and that of their children than rich people are.
Interpretation
Both rich and poor people share a common desire for better lives and futures for themselves and their children.
The quote by Theodore Schultz emphasizes that the aspirations and concerns for improvement in life are universal among all socioeconomic classes. It highlights the misconception that poor individuals are less motivated to seek better opportunities for themselves and their offspring, when in fact, they possess the same drive and determination as those in wealthier circumstances.
In practice
In a discussion about social programs, one might say, 'As Theodore Schultz noted, poor people are just as motivated to improve their lives and their children's futures.'
People who are rich find it hard to understand the behavior of poor people. Economists are no exception, for they, too, find it difficult to comprehend the preferences and scarcity constraints that determine the choices that poor people make.
Economic medicine that was previously meted out by the cupful has recently been dispensed by the barrel. These once unthinkable dosages will almost certainly bring on unwelcome after-effects. Their precise nature is anyone's guess, though one likely consequence is an onslaught of inflation.
Some people say we have this inequality because some people have been contributing much more to our society, and so it's fair that they get more. But then you look at the people who are at the top, and you realize they're not the people who have transformed our economy, our society.
There is no western, capitalistic country in which the conditions of the masses have not improved in an unprecedented way.
People.. were poor not because they were stupid or lazy. They worked all day long, doing complex physical tasks. They were poor because the financial institution in the country did not help them widen their economic base.
The recurrence of periods of depression and mass unemployment has discredited capitalism in the opinion of injudicious people. Yet these events are not the outcome of the operation of the free market. They are on the contrary the result of well-intentioned but ill-advised government interference with the market.
To get back to the kind of shared prosperity and upward mobility we once considered normal will require another era of fundamental reform, of both our economy and our democracy.
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