The trouble with blaming economic inequality for many of our economic ills is that the theory doesn’t fit the facts. One theory is that growing inequality caused many low- and middle-income Americans to over-borrow so they could keep up with wealthier Americans.

This borrowing allegedly led to the credit bubble and the Great Recession. The recovery has been plodding — the theory continues — because so many strapped households don’t earn enough to dig their way out of debt. A skewed income distribution is at the core of our problems.

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