Former Clinton Labor Secretary and current UC Berkeley professor Robert Reich really nails it on his blog today: But even an adequate stimulus package will offer only temporary relief this time, because this isn't a normal downturn. The problem lies deeper. Most Americans can no longer maintain their standard of living. ... The heart of the matter isn't the collapse in housing prices or even the frenetic rise in oil and food prices. These are contributing to the mess but they are not creating it directly. The basic reality is this: For most Americans, earnings have not kept up with the cost of living. Reich then goes on to explain that, since the 1970s, facing stagnating wages, American families sent women into the workforce to supplement family income, then families worked longer hours, and finally they relied on borrowing -- through credit cards and equity in their homes -- as a means to increase their standard of living. And now that the last source of wage supplement has dried up, the recession that we're headed for will require a ground-up fix, rather than a temporary (and marginal) boost to family income. Growing inequality, where the gains from increasing productivity have accrued mainly to the wealthy, is ultimately harming the nation's economy. Economists and policy makers can no longer duck the inequality issue with a "well, life isn't fair" attitude: Inequality bears directly on the ability of the economy to sustain and improve the standard of living for all Americans. The economy, after all, does not exist to protect and extend the fortunes of the fortunate. Image by Flickr user incendiarymind used under a Creative Commons license.