A Wall Street firm, Goldman Sachs, released a paper July 6 about the unequal distribution of income in Euroland, Japan, and the US. Rising inequality, the paper notes, "can affect the long-term growth prospects of an economy, as well as the way an economy behaves throughout the [business] cycle." It sees a risk that more inequality could lead to protectionism, which would hurt global trade, and thus do "more damage than good." The best medium-to-long-term answer to rising inequality is better education, the firm suggests, something that can't be engineered overnight.
They were right. But in 2005, why would Goldman care? Oh yeah, to bet against the country.