The other day, I stopped for lunch at the local branch of a well-known sandwich and salad franchise, and ordered a salad. The total came to $10.33. (Don't get me started. This is why I don't eat out much.) When the time came to pay, I handed the cashier a $20 bill. He seemed to indicate that he was concerned about making change for the difference and asked if I had 33 cents in change. I didn't, but offered a dollar bill to avoid him having to give up four ones and a five in change. He said that would be helpful, but then the process ground to a halt. After a while, he confessed sheepishly that math wasn't his strong suit and, somewhat puzzlingly, his cash register was willing to let him enter the amount given but would not tell him the change required. Thus, it fell to me to tell him how much I should get back. (Yes, I gave the correct figure.) (In the end, it turned out he had no $10 bills, so my effort to limit the number of bills he had to give back was for naught.)
Much is made about income inequality and what is seen as a growing gap between the haves and the have-nots. Incomes become more equal during recessions and less equal during boom times - essentially, the wealthy have more assets in volatile categories, such as stocks. Over time, though, at least two under-appreciated phenomena result in greater income inequality. First is the tendency for like-minded people to marry. In a society where women's labor force participation is near that of men, this means couples with two high incomes and couples with two low incomes, thus magnifying the difference in the earning potentials across families. Second, one reason for low earning potential is the lack of basic skills. I don't mean to pick on my young cashier friend, as he's hardly an isolated example. But someone allowed him to graduate from high school (I presume) without being able to subtract small sums in his head. Others can't regularly write a coherent, gramatically-correct English sentence. This limits their earning potential, to put it mildly.