Robert Reich is the tiny Democrat who was one of the strongest progressive voices in Bill Clinton's cabinet. Since those day on the national scene, Reich has frequently spoken out on liberal causes and lambasted Republicans whenever possible. Today, Reich's topic of choice is income inequality. Reich claims that the GOP does not think that the inequality is important and then he "explains" why it actually is. Here, in Reich's exact words, is what he says:
When almost all the gains from growth go to the top, as they have for the past 30 years, the vast middle class doesn't have the purchasing power necessary to keep the economy growing and generate lots of jobs.
Once the middle class has exhausted all its coping mechanisms - wives and mothers surging into paid work (as they did in the 1970s and 1980s), longer working hours (which characterized the 1990s) and deep indebtedness (2002 to 2008) - the inevitable result is slower growth and fewer jobs.
Slow growth and few jobs hit the poor especially hard because they're first to be fired, last to be hired and most likely to bear the brunt of declining wages and benefits.
It sounds good, doesn't it? What Reich is actually saying is that it is bad for the economy as a whole if the gains from growth go just to the rich while leaving the poor and middle income groups largely unchanged. Well guess what! Nearly all conservatives agree with this conclusion. Conservatives do not argue that it is a good thing when only the rich prosper. Quite the contrary, conservatives seek to follow policies that will increase the income levels of everyone including the rich, the poor and those in the middle. You see, the debate between left and right is not the one that Reich discusses. The true debate is HOW to deal with the problem of the distribution of economic growth. Liberals like Reich talk of taking money from the rich through higher taxes so that the government can help the poor and the middle income more. That would make the rich less rich, but it would do very little for the rest of us. Conservatives talk of growing the economy in a way that everyone benefits. They want to make the poor wealthier, the middle income groups wealthier and the rich wealthier. That would help everyone.
The truly strange aspect of this debate is that there has only been one period during the last 30 years when a strongly progressive economic agenda was followed by the federal government. That period has been the last five years under president Obama when federal spending soared, welfare programs were pushed to grow quickly, the federal government inserted itself into corporations and industries from autos to healthcare, and taxes on the rich were raised significantly. This has also been the period when almost all gains in wealth have gone to the rich. For example, studies have shown that during the last five years under Obama all but 5% of income gains in the country have gone to the most wealthy among us. By comparison, during the last five years of the Reagan presidency (a period that Reich hates for supposedly only promoting the welfare of the rich) about 45% of income gains went to the middle income and poor segments of society.
The problem for the left, you see, is that there policies do not work to stop income inequality. The opposite is the actual truth. An unbridled progressive program (which is what we have been following) is a proven way to promote income inequality not to fight it. That is why all these speeches and articles about income inequality never debate the best way to reduce that problem. The left knows that the actual facts show that their policies do not work. Instead, what the progressives talk about is how income inequality is a problem and the "mean" Republicans do not care about it. Instead of discussing the actual problem, they rely on attempts to vilify their opponents.
The tactics of the Democrats may have worked in the past, and they may continue to work in the future. That is up to the electorate. We will have to see that unfold next November. One thing is certain, however, and that is this: nothing that the Democrats have proposed is going to help with income inequality. Their prescription will just continue to help the rich.
When almost all the gains from growth go to the top, as they have for the past 30 years, the vast middle class doesn't have the purchasing power necessary to keep the economy growing and generate lots of jobs.
Once the middle class has exhausted all its coping mechanisms - wives and mothers surging into paid work (as they did in the 1970s and 1980s), longer working hours (which characterized the 1990s) and deep indebtedness (2002 to 2008) - the inevitable result is slower growth and fewer jobs.
Slow growth and few jobs hit the poor especially hard because they're first to be fired, last to be hired and most likely to bear the brunt of declining wages and benefits.
It sounds good, doesn't it? What Reich is actually saying is that it is bad for the economy as a whole if the gains from growth go just to the rich while leaving the poor and middle income groups largely unchanged. Well guess what! Nearly all conservatives agree with this conclusion. Conservatives do not argue that it is a good thing when only the rich prosper. Quite the contrary, conservatives seek to follow policies that will increase the income levels of everyone including the rich, the poor and those in the middle. You see, the debate between left and right is not the one that Reich discusses. The true debate is HOW to deal with the problem of the distribution of economic growth. Liberals like Reich talk of taking money from the rich through higher taxes so that the government can help the poor and the middle income more. That would make the rich less rich, but it would do very little for the rest of us. Conservatives talk of growing the economy in a way that everyone benefits. They want to make the poor wealthier, the middle income groups wealthier and the rich wealthier. That would help everyone.
The truly strange aspect of this debate is that there has only been one period during the last 30 years when a strongly progressive economic agenda was followed by the federal government. That period has been the last five years under president Obama when federal spending soared, welfare programs were pushed to grow quickly, the federal government inserted itself into corporations and industries from autos to healthcare, and taxes on the rich were raised significantly. This has also been the period when almost all gains in wealth have gone to the rich. For example, studies have shown that during the last five years under Obama all but 5% of income gains in the country have gone to the most wealthy among us. By comparison, during the last five years of the Reagan presidency (a period that Reich hates for supposedly only promoting the welfare of the rich) about 45% of income gains went to the middle income and poor segments of society.
The problem for the left, you see, is that there policies do not work to stop income inequality. The opposite is the actual truth. An unbridled progressive program (which is what we have been following) is a proven way to promote income inequality not to fight it. That is why all these speeches and articles about income inequality never debate the best way to reduce that problem. The left knows that the actual facts show that their policies do not work. Instead, what the progressives talk about is how income inequality is a problem and the "mean" Republicans do not care about it. Instead of discussing the actual problem, they rely on attempts to vilify their opponents.
The tactics of the Democrats may have worked in the past, and they may continue to work in the future. That is up to the electorate. We will have to see that unfold next November. One thing is certain, however, and that is this: nothing that the Democrats have proposed is going to help with income inequality. Their prescription will just continue to help the rich.
No comments:
Post a Comment