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Published on: May 1, 2014
Unequally Republican
The Right Wrestles with the Inequality Debate

The bitter rivalry between “establishment” and “Tea Party” Republicans in many southern states today reflects the bitter divisions within the white South that date back to the political battles between the low country plantation owners and the poor white farmers of old Dixie.

Inequality is one of those issues that tend to unite Democrats, alarm independents and divide Republicans; this is no doubt one of the reasons we are hearing so much about it in an election year from the liberal wing of the American media. If it were up to the GOP, the subject would never come up; having the conversation at all raises questions that many GOPers would prefer to avoid. Nevertheless, inequality is an important issue on the right, and the GOP divisions on inequality are both complicated and deep; some GOPers don’t think inequality is a problem at all, and those who do offer conflicting explanations for what is going on.

For some in the GOP, following a long line of classically liberal analysis that has centuries of history behind it, inequality not only may not be that bad: it could actually be good. And even if it is bad, efforts to fix it through government policy are likely to do more harm than good. Inequality is a natural result of the human condition, these people argue. Some people are smarter, harder working, more talented or just luckier than others, and in a free society in which people can use their talents to the fullest, some people are going to wind up richer than others.

But, argue the classical liberals, by giving free rein to the talents and ambitions of the strongest, we are setting in motion a process which over the long run will make everyone better off. The talented will invent new technologies, discover new drugs, make compelling art and otherwise enhance the general human storehouse through their own unfettered pursuit of happiness. Any heavy handed government efforts to keep the talented from becoming too successful will slow down the pace of innovation and change that historically has seen living standards for average people skyrocket over the last three hundred years. This idea isn’t going away anytime soon and the reality that three hundred years of capitalist development has in fact raised living standards to unprecedented levels in much of the world suggests that there may even be some truth in it.

Nevertheless, in its purest and most dogmatic form, out there where Ron Paul communes with the spirit of Ayn Rand on the open range, libertarian ideology isn’t going to dominate mainstream American politics for the foreseeable future. I’ve argued before that the United States is becoming more libertarian and individualistic over the long run, but there is no sign that Americans want to drink their libertarianism straight from the bottle—especially when that would mean abandoning government programs that benefit the middle class.

Those mixed feelings put classical liberal economic thought in an odd spot in the United States. On one level, these ideas are hard wired into the national consciousness and for many people serve as bedrock convictions. When millions of Americans think about questions like inequality, their views are heavily influenced by classical liberal ideas. Yet at the same time, when it comes to policy, voters tend to reject candidates whose proposals seek to bring the rigors of free market discipline to bear on difficult social issues. Republicans often find themselves whipsawed by the cross currents of public opinion: cheered wildly when they talk about the wonders of the invisible hand, the evils of redistribution and big government programs in the abstract; hung out to dry when they frame concrete proposals around the ideas that attract such fervent applause.

The modern Republican party feels this contradiction even more acutely than in the past. The white South, which switched parties en masse in the generation after the Civil Rights era, had a largely populist and redistribution minded wing back in the days of FDR. “If you aren’t getting something for nothing, you’re not getting your fair share,” Louisiana governor Huey Long is supposed to have told his constituents. They loved him.

The white South’s hunger for federal spending that supports ordinary Americans has deep roots.  During the long and painful decline of the family farm from the 1880s through the 1930s, American populism centered on the concerns of farmers disadvantaged by the new manufacturing economy. “Parity,” the concept that farm incomes should be topped up so that farmers would earn as much as urban people, was an important rallying cry throughout the white South in these years and it presupposed a large and active government role. New Deal programs like rural electrification and the TVA were strongly supported by millions of people whose lives they permanently changed.

The white South’s switch to the GOP wasn’t just about race; the South switched parties in part because classical liberal economic ideas made more sense as the people of the region moved out of agriculture into urban and suburban life. A rapidly modernizing white South renewed its faith in free markets as those markets seemed to be working better in Dixie. Before World War Two the South was, economically speaking, a kind of colony, producing mostly raw materials for the manufacturing economy of what is now the Rustbelt. Its political pattern—racist, redistributionist and populist Democrats opposed to somewhat less racist, oligarchical “Bourbon” Democrats—still reflected the region’s 19th century division between populist Democrats and elite Whigs. Partly to keep African-American voters at bay, the post-Reconstruction South replaced the old two party system with a single party. The Democratic primary (which, under the laws of that time, could be closed to non-white voters) was where the real political competition between ex-populist Democrats and ex-Whigs took place and intra-party feuding could be bitter and sharp.

As the mass of white Democrats switched to the GOP, they brought their old divisions with them. Tea Party Republicans today have roots in Jacksonian populism, while establishment Republicans have more in common with Henry Clay. Those tensions were muted during good times. For the last generation, populists in the white South (with living standards rising faster than in most parts of the country) had largely forgotten their earlier sympathy for redistribution, price controls and government income support. For some, one regrets to report, this was at least partially because the Great Society welfare state extended benefits to more African Americans than the New Deal welfare state (which, to get critical support from Southern legislators, excluded categories like agricultural and domestic workers from many of its original provisions) had done.

But tensions between the former populists and the former Bourbons still seethed under the surface; the bitter rivalry between “establishment” and “Tea Party” Republicans in many southern states today reflects the bitter divisions within the white South that date back to the political battles between the low country plantation owners and the poor white farmers of old Dixie. A similar dynamic in the North brought disillusioned ‘Reagan Democrats’ into the GOP; there, too, a gap between establishment Republicans and populists reflected deep differences of economic interest and social position.

The slowdown in economic growth, the crisis of southern manufacturing and the stagnation of living standards for many white Southerners have reawakened the old divide in the white South and among Republicans nationally. Reaganite, free market ideology is still, as they say, hegemonic in white Southern political discourse, so the GOP faces a dilemma. The socio-economic tensions and class issues brought to the surface by the state of the economy fire a lot of passion among party members and create tensions between the establishment and populist wings of the party, but the issues can only be addressed within a Reaganite ideological context.

As a result, many people on the right today are working to develop a GOP counter-narrative on inequality that they hope will help them win support in intra-party battles and reach out beyond the party to link up with populists outside it. These include politicians like Paul Ryan, Mike Lee, and Marco Rubio. So far, two main lines of explanation seem to be out there. One speaks more directly to economic conservatives and one addresses social conservative themes, but the two narratives appear to be gradually merging into a unified populist GOP approach to the inequality debate.

Like the left-liberal narrative, the conservative inequality narratives are cast in the form of jeremiads: America has departed from the ancient path of rectitude and has gone astray. We are suffering the grim consequences of our foolish and blind missteps and will continue to do so until we return to the right path. This is, as I noted in my essay on the left-liberal inequality debate, the oldest and most common form of political discourse in the United States. The jeremiad takes us right back to Puritan New England: God’s chosen people have gone astray, worshipped false idols and unless they turn back to the true path are going to be smitten and scourged.

But if the liberal narrative sees the ancient path of righteousness as the trail blazed by FDR and the New Deal, the conservative narratives look farther back: to the economic and social ideals of pre-New Deal America. As a nation we have apostatized from the faith of our grandfathers; as a result, we are suffering today and the rise of inequality and loss of general prosperity are part of the pain we endure. They can only be cured if we return to the correct path.

One version of the conservative inequality story is an economic jeremiad that points to the ancient truths of economic life as revealed by Adam Smith and the classical liberals. America once lived by the true faith, the economic conservatives argue, but we have turned aside. We have embraced the hell-spawned alliance of a large corporate establishment and a powerful central government. We have deserted the shrine of true liberal economics to worship the false idol of crony capitalism. Rent seekers have driven true entrepreneurs out of the temple; corrupt elites in politics and corporate life swap favors and powerful interests have captured the mechanisms of the regulatory state to buttress the power of the rich and well established.

Like the left-liberal narrative, this right-liberal narrative is grounded both in empirical truths and powerful beliefs that shape American consciousness. It captures themes that have been central to American protest movements for hundreds of years and restates them in ways that speak powerfully to the concerns of millions of Americans living today.

However, many American conservatives are more concerned about social and religious issues than the right-liberal narrative has room for, and a second conservative inequality story has taken shape. In this vision, our economic troubles and especially inequality result less from errors in economic policy making than from a national moral collapse. Social conservatives tend to see a series of threatening social changes that are eroding the institutions and beliefs that have made America work. A culture that looks on human sexuality as a recreational pursuit rather than an encounter with transcendence inseparable from monogamous marriage and childbearing has, for many social conservatives, lost touch with the values that any society needs to stay healthy and prosperous long term. The decline of the two parent family, the rise of a culture of instant gratification, the pornography explosion, the acceptance of homosexuality: for many Americans, these developments are the harbingers of the decline of our political and economic life. Unless Americans return to the spiritual and personal values that marked our society in earlier times, we face inexorable decline – our society will become less just, less free, less equal, less honest, less safe and less rich. We need, as Linda Ronstadt sings it, “a whole lot more of Jesus, and a lot less rock and roll.”

Once again, this is a narrative that can show substantial empirical evidence to back it up at least in part and it speaks to enduring American beliefs and concerns. It also speaks especially powerfully to Southern populist GOP conservatives, among many of whom the old time religion has deeper roots than the old time political economy.

Thanks to the concept of culture, the two conservative narratives can be blended into a kind of unified field theory of conservative populism. Traditionally, one can argue, the United States was guided by a culture that combined the love of small government, free markets, religious faith and strong family values. That culture is under assault today, and as it loses its power, we face an ever growing sea of troubles. Weak family values lead to children growing up without the ability to build strong families themselves or earn good livings. More and more children grow up in economically and socially insecure single parent households. This in turn creates a culture of dependency; people are willing to cede more power to the state in return for more handouts. The bloated state becomes increasingly dysfunctional, imposing higher taxes and regulatory costs on an increasingly sluggish economy. Greedy rent seekers flock to Washington, diverting ever larger masses of wealth into their own hands and further distorting economic processes. The Hollywood and Wall Street elites, amoral to the core, reap ever greater rewards as in their different ways they continue to undermine the foundations of American social stability and economic prosperity.

This is a powerful story, but it splits the Republican party along the old Bourbon-populist lines. There are lots of establishment Republicans (and Democrats) who are quite happy with a Washington culture of back scratching and favor-swapping. Many of the Tea Party versus establishment battles inside the Republican Party today are about the efforts of insurgents to dismantle a system that the career politicians consider a natural and necessary way of getting the nation’s business done. Similar issues used to divide Southern Democrats, with “moderate” establishment Bourbon Democrats like South Carolina’s Wade Hampton coming under fire from radical populists like “Pitchfork” Ben Tillman.

The populist critiques of the establishment on both the left and the right do more than create intra-party civil wars. They speak to problems that are hard to solve. Establishment resistance against populist reforms is not simply a matter of personal greed, though a great many establishment politicians are lining their pockets as rapidly as they can.  Populist demands to separate money and politics often work better as slogans and rallying cries than as practical programs for running the country. South Carolina Senator Ben Tillman, a vicious and violent racist who defended lynching but wanted the government to spend money to help the little people as long as they were white, introduced the first federal campaign finance law in American history as part of his populist program to redeem government from cozy establishment interests; the law passed but, like so many other campaign finance bills, had little effect on the realities of power in American life. It is not actually possible to build a Chinese wall between wealth and power on the one hand and the political system on the other; reformers may eliminate a symbol like earmarks from the legislative process, but the favor swapping and influence peddling that cannot be separated from representative democracy will simply take new forms. Populist aspirations make sense, and whether or not one takes either the left or the right inequality narratives to heart there is clearly something out of whack in American life today. But populism has always been better at articulating grievances than at solving problems, and there are signs that neither left nor right populism in American life today can fully break with this pattern.

It’s also clear that both left and right populism in America today are nostalgic; they seek to restore old orders rather than to imagine or build something new. This again is characteristic of eras like ours. The transition from late industrial society to an early stage information economy is hugely disruptive and painful. At the moment, it is easier and more natural for many people to worry about what is being lost than to look forward to the new possibilities that technological progress is creating for our future. Moreover, the concerns that both left and right populists express about the growing problems in society are rooted in real events. Tens of millions of Americans feel insecure and face uncertain economic futures even as a minority enjoys access to unprecedented riches. Family life is in a real crisis; rent seekers and lobbyists exert a genuinely troubling influence over political decision making even as the general interest seems neglected by a short-sighted political class.

But the politics of nostalgia and the rhetoric of jeremiad, however appealing and justified, won’t actually help. A left pining for the 1930s and a right pining for the 1890s can’t deliver the improvements they long for. And populism, which is more of an engine light indicator telling us that something is wrong than an instruction manual telling us how to fix things, will not alone guide us toward the vision or policies that can remedy the problems that have populists upset.

The road to dealing with inequality and the linked problems of our economic transition in the United States is likely to be a long and winding one, and many things will have to change before the country settles into a new social model. But we can’t sit with folded hands and counsel patience as the processes of social and technological change slowly work their way through the system; people live their lives in the here and now, and they need to see that the trajectory of change, at least, is positive. At the moment we don’t as a society even have a real vision of what a better, non-nostalgia drenched future might look like, much less a sense of what policies might help us get there faster.

This needs to change.

show comments
  • wigwag

    Yes the road to dealing with inequality may be a long one, but the Tea Party has gotten off to a very auspicious start. Professor Mead keeps talking about a “blue war” that exists no where but in his fecund imagination, but there is a political war going on; it’s between Republican elites and Tea party cadres; it’s the folks with the pitch forks who are winning. A perfect example of this is over the issue of education. The Bush “No Child Left Behind” program which morphed into the Obama “Race to the Top” program and then culminated in the Common Core Curriculum has launched a major conflagration within the Republican Party. On one side stand parents led by Tea Party activists who don’t want unaccountable, elitist bureaucrats in Washington, D.C or their state capitals defining what a school curriculum should be. On the other side we have GOP elites including Bobby Jindel, Jeb Bush, Rick Scott and others who are being attacked relentlessly for their arrogant attempt to rob parents of their rights to have input into what their children learn. Of course the elites have plenty of money behind their attempt to impose a one six fits all on American education. Virtually the entire hedge fund industry supports the common core, so do big testing outfits including Rupert Murdoch’s News Corp. The nefarious Bill Gates is using billions of dollars in his Foundation to push the monstrosity of the Common Core on parents and so is the fabulously wealthy Walton family. The amazing thing is that the Tea Party is fighting back and they are winning. Instead of excoriating the Tea Party activists, the populist left should be learning from the Tea Party of even aligning with it.

    You’re wrong Professor Mead; there is no “blue” civil war, but we do desperately need one. Progressive populists in “blue” states are just as disgusted with the common core as
    “red” state Tea Party members are. Occupy Wall Street mothers don’t want their seven year old children sitting for ten hours taking on line tests (which are longer than the bar exam typically given to prospective lawyers) any more than Tea Party members do. The difference is that the Tea Party is standing up to make and screaming “no.” Leftists on the other hand are still genuflecting to their arrogant elites such as Rahm Emmanuel and Andrew Cuomo.
    When figures as diverse as Arnie Duncan, Bill Gates. Paul Tudor Jones, Jeb Bush, George Soros, Bill Koch, Rahm Emmanuel, Andrew Cuomo, The Walton Family, Fox News and the New York Times are all in violent agreement about something, you know that something is rotten in Denmark. All of these elitist agree on implanting the Common Core whether parents like it or not. They all want small children tested for hours on end with every keystroke stored in a cloud based data base. And they all want to use a data base underwritten by the Gates Foundation and developed by Rupert Murdoch’s company to collate all the data obtained from tens of millions of American school kids so it can be sold to software developers who stand to make billions of dollars developing individualized software. The cloud based system is called “inBloom.” Google it to see what I mean.
    What we desperately need is a smart politician who can make a compelling case to rightwing and progressive populists that far more unites them than divides them. The war being mounted by elites of both parties on the right for parents to have Input into their children’s education is the personal vehicle to begin to unite the left and the right against their real enemies; America’s arrogant oligarch’s who have nothing but sustain for people who don’t travel to work on the corporate jet.

    • johnwerneken

      Supposing you were correct about common core, those are EVEN MORE reasons why it’s a GREAT idea. People need to learn how to figure stuff out, the why not the answer. Locally controlled public schools are the PROBLEM not the solution. Regional or national taxes funding education vouchers parents can use anywhere are the answer. Common Core is about demonstrated capabilities not about how to teach them nor about social or political values.

    • Marty Keller

      ” . . . there is far more that unites them than divides them.” Seems to me this is as vaporous as the “blue civil war” is to wigwag. Perhaps on the surface and for a fleeting moment, yes, but not for long and not permanently since they’re coming from very different worldviews and beliefs. Indeed, possilby a skilled politician could cobble them together into a short-term winning coalition, but creating out of that a stable new social order will take a statesman with the qualities of Abraham Lincoln, and still that might not be sufficient.

      History tells me that whatever we might “desperately need” in the nature of a political “fix,” we are unlikely to get it; the magnitude of the world political economic revolution is simply too great for any one faction to master. We must ride out the chaos as best we can, and cherish the conflicting narratives, longings, and finger-pointing as unfortunate but unavoidable elements of this unprecedented global transformation.

    • Anthony

      Some very interesting ideas, as usual. I disagree with you on one narrow point, however. You should not put George Soros into the group of tycoons that are pushing the “educational reform” measures that you disagree with. Unlike most elite democrats, such as Lawrence Summers and Fareed Zakaria, who tend to cluster around elite consensus positions, Soros is actually an outsider whose ideas have generally been rejected by the Democratic party because they are too liberal. For example, Bill Clinton and people like Summers and Bob Ruben, tend to believe in the kind of market fundamentalism that Soros has been railing against for twenty years. The elite consensus, a la “the random walk down wall street,” was accepted by the democrats during the nineties. Yet, this is an idea that Soros has always vocally opposed.

      On the issue of education, you can see Soros’ views on the web site of his Open Society Foundation. There is nothing about high stakes testing or school vouchers. This stands in sharp contrast with the views of Bill Gates, the Walton Family and President Obama.

      http://www.opensocietyfoundations.org/issues/education-youth

      • wigwag

        Hi Anthony. Other than the Bill and Melinda Gates Foundation, the Carnegie Corporation and the various philanthropies controlled by the heirs of Sam Walton, one of the largest and most powerful non-profit advocates for the Common Core curriculum is the “Robin Hood Foundation.” This New York based organization (which in fairness does some excellent work) was founded by hedge fund billionaire, Paul Tudor Jones. The organization is the “go to” charity of the hedge fund industry. Every year they hold their annual gala event in the Javits Center on the West Side of Manhattan; I’ve been to it. Its like nothing you’ve ever seen. The event often raises $100 million in one evening.

        As it happens, for the past decade the largest single donor to the Robin Hood Foundation has been George Soros. Whatever his personal feelings about the Common Core may or may not be; by supporting the Robin Hood Foundation, George Soros is supporting the organizations advocacy on behalf of the Common Core; a cause on which the Foundation has spent many millions of dollars.

    • Anthony

      WigWag, as you now know there are two distinct Anthony postings on TAI. The latter post out of Korea (I think) and has replied below (again, good to see you back).

  • Anthony

    “Inequality is one of those issues that tend to unite Democrats, alarm independents and divide Republicans.” Inequality is meme for moment but as Thomas Piketty lays out it’s functional feature of capitalism and has historic trends. Meanwhile, WigWag is on to something (and it’s a pleasure to have him back in rare form). The Left and Right may be morally justified to feel politically irked; inequality, commoncore curiculum, social decadence, transitional societal change, etc. may be motivators. But how one behaves rationally or otherwise is determined by one’s intellectual analysis and program for eliminating or avoiding felt difficulties. Herein lies crux of both WRM and WigWag’s overarching theme – how to bring warring tribes together under anxious circumstances. In particular, objective factors are present (WRM implies and cites many) that have both left and right, democrat and republican feeling askew (something not right). Although this may be true, the aims of both political parties, declared and achieved, are to maintain the existing politico-economic system and the same relative distribution of its rewards. So can populist et al find salvation chasing that venue? By degrees, the common citizens who seeks antagonisms where they don’t exist ends up inevitably as essay describes seeking alternatives that have historical antecedents no longer applicable (“a left pinning for the 1930s and a right pining for the 1890s” that can’t deliver the improvements they long for). On the whole, the outlook doesn’t change. On the other hand of all the good created by capitalism, one of the most important remains knowledge – change is inevitable.

    • El Gringo

      “On the other hand of all the good created by capitalism, one of the most important remains knowledge – change is inevitable.”

      Indeed – this is the very change that has so many Americans truly frightened. “The transition from late industrial society to an early stage information economy is hugely disruptive and painful. At the moment, it is easier and more natural for many people to worry about what is being lost than to look forward to the new possibilities that technological progress is creating for our future.”

      Liberals are terrified because the blue model which has sustained the country since FDR is falling apart. Conservatives are equally terrified because the blue model (that woolly old sheep) is falling apart. The Blues are seeking solace in more government while the Reds are seeking solace in Jesus. Humans, by their very nature, are terrified of change. And, unfortunately for Americans, at this moment of crisis and uncertainty, they aren’t looking for leaders to show them the way forward but, instead, to show them the way back.

      • Anthony

        Your second paragraph sums it up nicely but I like the 3rd too (where the public goes wrong).

      • Episteme

        It’s interesting to note how both Liberals and Conservatives are reacting to the transition to the change from late-industrial to early-information with actual similar splits, but the left happens to currently have a dominant group in theirs. On the blue side, you have what currently appears to be in America a well-managed split between Liberal-Populist and Progressive-Technocrat groups, while the Right is more openly conflicted between Conservative-Populist and Conservative-Libertarian groups. However, the same split on the left has been in conflict over their major techocratic project in EU of late, so it’ll be interesting to see how current issues with the ACA’s troubles affects the Progressives’ control over the left’s coalition on this side of the Atlantic in the next few years. Similarly, I wonder how changing social mores might affect the libertarian/fiscal side in terms of the Cold War “Fusionist” Bucklerian coalition (the Right’s post-Goldwater version of the FDR or LBJ teamups)…

        • Thirdsyphon

          I think the blue split isn’t well-managed so much as *easier* to manage, because liberalism in its current ideology isn’t really about much more than defending the status quo. The goals of modern conservatism are much more ambitious, and one suspects that there are plenty of people who are willing to sing in the chorus of, say, entitlement reform for only so long as they believe it has no chance of going through.

  • lehnne

    Notice that in Mead’s assessment there is no reference, mention or acknowledgement to the vast change in material circumstance from previous eras it’s as if it didn’t occur. An astonishing omission but not unexpected considering the current state of debate about this issue.

    • Boritz

      One can imagine a debate raging thousands of years from now about how it is unfair that some only own one planet while others own multiple solar systems and then there will be the 1 percenters who have large tracts of the multiverse.

      • bannedforselfcensorship

        More likely is a future where most consumption is of media and experiential stuff like tourism.

        The limit then will be time not money.

        Instead of “how many yachts can you water ski behind?” the question will become “how many iPads can you watch cat videos on?”

    • Roland

      Amazing that Mead admits that capitalism over the last 300 years has raised everybody’s quality of life to an astounding degree and then he can only grudging bring himself to admit that there might be some truth or merit in it. All the government programs have been flops or mediocrities but his faith still resides there. How many millenia does it take for capitalism to work to admit that it’s the best system and abandon his socialist theory? How many 100’s of years of socialist failure will it take to prove the converse? Weird that such a smart guy can be such an idiot in this area. The empirical data have spoken. Maybe if he had had some real work experience in his life he would at least understand it by anecdote.

    • Andrew Allison

      . . . the vast change in material circumstance from previous eras of the low end of the income equality scale . . .? What is so disgustingly mendacious about the “inquality” nonsense is that it ignores the latter.

  • RobM1981

    Inequality is an effect, not a cause.

    Inequality happens because of other policies – it doesn’t start them.

    So, what drives inequality? Oh, I dunno… let’s say Unemployment. People who don’t have jobs tend to fall behind people who do.

    Or… hmmm… how about underemployment? People who can only get 20 or 21 hours of work a week? Yeah, they fall behind those who work full time.

    Or, on the flip side, what about unequal inflation? Like, for example, if someone poured money into banks. Or poured money into the money supply, which also goes to banks (first). Do we have any Ph.D’s here who can figure out where that money went? Did it go to those unemployed people, or did it get used to bring those 20-hour workers into full time? Or did it go to the banks, the stock market, and other such things?

    Because people who work as executives at banks tend to make more money than other people. And people who own stock and see it inflaaaate like a bubble… well, yeah, they tend to be on the “have” side of the have’s versus have-not’s.

    Now… is there one common link in all of these things? Is there one person, leading an administration of folly, who has driven all of these things?

    Why, yes! Yes there is! It’s a person, if you can believe it. He lives at 1600 Pennsylvania Avenue, when he’s not jetting around on important missions and vacation and fund raisers. I’d say “ask him,” but he’s a well known liar, so you really won’t get the truth from him.

    Which doesn’t mean that the truth doesn’t exist. It does, and it’s simple: Barack Obama and everyone who works for him and/or voted for him did this. If you voted for him, this is what you asked for. You did this.

    And, believe me, it was completely predictable. 100%

    • Curious Mayhem

      Of course. One major source of *income* inequality these days (not wealth inequality) is the dropping labor force participation rate. It slowly fell after 2000, but then fell off a cliff in 2009 and later. It’s not due to retirement either, as the rate is rising for age 60+ and has fallen the most for 16-34-year-olds. **Most of the drop in the unemployment rate since 2009 is due to this, NOT new jobs.**

      Well, where do all those people go? First off, they’re no longer counted as “unemployed,” because they’re completely out of the labor force. Presto — the official unemployment rate drops, even though it’s not at all for the reason many people think. (Although many have gotten wise to this.) How do they live? They are beneficiaries of “income transfers” — the dole. The proportional of household income coming from transfers has risen by about 40% since 2007. The point is to hook people on the dole, then they’ll vote reliably for Democrats. That’s theory, anyway.

      When Romney was going on in 2012 about “recovery, not dependency,” this is what he meant. His only failure was just not going far enough or starting early enough in talking about this (planned) disaster or assigning blame where it belongs.

      Another aspect of *wealth* inequality that is rarely mentioned is the aging of society. While the overlap is not perfect, an on-average-older society has a larger skew in wealth distribution, because older people have more assets. (Until they retire, they also have the highest incomes, by age.) It would be fine for younger people starting out, but only if they can get jobs (see above) and avoid getting into hock for student debt. (And see other fine comments here about the stalling of economic growth.)

    • bannedforselfcensorship

      I would like to see some research on a Fed that used direct money creation sent to each citizen instead of being laundered through the banking system.

      I think that would be far more democratic. I’m not sure its possible, though.

  • Andrew Allison

    “The bitter rivalry between ‘establishment’ and ‘Tea Party Republicans” which is raging across the Nation, from Alaska to Florida has nothing to do with the history of the South and everything to do with the disgust of the Republican rank-and-file with an establishment which no longer represents them. See http://www.therepublic.com/view/story/9488a0eac9884b4381ef181d178a769f/AK–Alaska-Republican-Rift for a graphic example: the establishment is not merely out of touch, but determined to hang onto power at all costs.
    Could we also be more specific about “inequality”. The current political posturing is about income inequality, just one of the many inequalities that have always, and always will exist. From each according to his ability, to each according to his need was tried on grand scale in the 20th Century, and failed spectacularly as such efforts must (the proletariat in the USSR had a different slogan: you pretend to pay us and we’ll pretend to work).

    • Boritz

      Makes you wonder where a comma could go in his phrase: “…low country plantation owners…”
      Is it low country, plantation owners or is it low, country plantation owners. I vote for the latter if this is the group that is supposed to be analogous to the establishment Republicans.

      • Farmer_Joe

        It is the plantation owners in the low country. “Low country” being distinct from from the more mountainous areas.

        • Andrew Allison

          I think Boritz knows that (he wrote could, not should). But, low (adjective) country plantation owners (noun) is as good a description as any of the GOP establishment. [/grin]

    • Curious Mayhem

      Yes. It’s all across the country — it’s not in any way specific to the South. It’s tension between Main Street and Wall Street. The latter benefits, at least for a while, from insane monetary policies that starve savers, lead to capital misallocation, discourage productive lending, and promote asset bubbles and speculative frenzies.

      Greenspan and Bernanke are both Republicans of this type. While Yellen is a Democrat and dovish on interest rates (another source of massive distortion), she does seem wary of money printing, which is why it’s coming to an end here. It’s still going on in Japan and about to start in Europe.

  • Anthony

    WRM, conceding markets (capitalism) have played a central role in the stunning increases in productivity and standards of living in the past two hundred years (increases that exceeded the past two millennia), your inequality essay appears to have hit a soft spot. Your exposition on some whys and wherefores concerning inequality elicits ( ). I think your underlying thesis is that we are paying a high price for inequality (using Piketty’s working definition) in that people live their lives in the here and now. And the changes working there way through the system – a system perceived to be less stable, less efficient, and with less growth (for them) – give a contemporary pause (perhaps peril) to our Democracy as average citizen remains flummoxed and anxious by societal reconfiguration.

    • Andrew Allison

      As noted above, the underlying thesis that we are paying a high price for inequality is nonsensical. The gulf may (doubtful) be wider than, say, the Industrial Revolution, Ancient Rome and Egypt, etc., but consider the lot of those at the bottom end. Which is not, I hasten to add an excuse for the absolutely ridiculous width of the gap, but let’s keep a little perspective here.

    • circleglider

      Inequality only has traction when economic growth stalls. When economic growth ceases to be a goal shared by all Americans, it is only natural that the focus will shift to inequality.

      • Anthony

        Economic growth using what metrics and defined within what dominant policy paradigm. Hopefully, you allude to an economic growth in accord with our theoretical fundamental values (more opportunity, higher national income, stronger democracy, and finally higher living standards for most Americans). Now, influencing our micro and macroeconomic policies to get there will require investing in our society. Then inequality becomes subsumed.

  • Andrew Allison
  • Fred

    My take is more a spengleriad than a jeremiad. A profound cultural rot set into this country in the 1960s. Two decades of conservative government temporarily obscured the rot, but really only put a Band-Aid over it. Beneath the Band-Aid it continued to fester. Now a combination of financial crisis, recession, and the Obama administration’s incompetent leftism has ripped the Band-Aid off, revealing the rot in all its pestilent ooze. But there’s no going back. Entropy goes in only one direction–from order to disorder, concentration to dissipation, organization to chaos–and entropy is a law of culture as well as physics. Spengler was wrong about a lot of things but right about two: civilizations have lifespans, and ours is near the end of its. Jeremiads are wasted. Optimismus ist feigheit.

  • Anthony

    Whether one calls a thing nonsense does not make it so. I think WRM as well as Nobel Economics Laureate Joseph Stiglitz are both applying thesis (high price for inequality) with perspective and and analysis grounded in valid concern for America’s future (see: The Price of Inequality). Any ancient references may in this case be categorized as distorting the facts (false analogy and irrelevant thesis).

  • circleglider

    Tarnishing classical liberalism with the pejorative populism does little to advance understanding. So does a mostly backwards-looking perspective that inaccurately credits “social conservatism” as such a potent force in today’s politics.

    Once again, Mead reveals himself captive to the milieu in which he operates, which is solidly Democratic and Progressive. Unlike this piece, his earlier incantation of the “Left Liberal Narrative” is at least honest and accurate. He will not be showing us the way to a new social model with writing like this.

  • vepxistqaosani

    I have proposed a simple solution to the inequality problem: Take all the excess wealth from the rich and divide among the poor, so all have the same. Then do the same with incomes.

    Oddly, though, those who complain most loudly about inequality protest that that’s not at all what they mean to happen.

    But does not simple logic demonstrate that if inequality is the problem, then equality must be the solution? And, contrariwise, if equality is not the solution, then inequality cannot be the problem.

    • jamson64

      Considering the way the rest of the World’s bottom 50% live I suspect even most liberals here would not be too quick to take that deal.

    • bannedforselfcensorship

      I suspect that if we agreed to a 5% extra tax, with the proviso that it was distributed via checks directly to all citizens that many on the Left would balk.

      They want to play with that money, not solve the problem.

  • teapartydoc

    The only way to make this go away is to abolish privilege created by connections to government, and the place to start is licensing.

  • bill

    I still have my copy of Atlas
    Shrugged I purchased in 1957. It was
    the first adult hard copy book I bought.
    Those “producers” of goods and services are not disappearing,
    as in Atlas Shrugged, they’re just
    moving their billions overseas and this is because those we sent to Washington
    are all making the easy choices and not looking out for the country. There are millions living well over the
    poverty level with every modern convenience who are not working and have no
    intention of working. This is
    unsustainable. But the most frightening
    thing I’ve heard this week is that China’s economy could soon surpass that of
    the US. Historically, no country has
    ever rebounded when that happens. This
    is something else that Obama can blame Bush for.

    • jamson64

      Yep…Bush signed NAFTA and all that.

      • LizardLizard

        !! Thought Clinton signed it!! ??

  • Curious Mayhem

    I clicked on this article because I’ve had to endure several weeks of that idiot “economist” from France, Thomas Pikaninny, or whatever his name is, being quoted as an expert on inequality.

    So, he *is* an idiot. His supposedly deep research is just a rehash of discredited theories and assertions about economic history, all of the refuted decades or centuries ago. The wealthiest don’t just exponentially accumulate wealth over generations without a break. Fortunes are made (or stolen), but then dissipated, squandered, and misspent, as well as wisely cared for and grown. They are subject to wars, revolutions, and inflations, as well as innovations that make old technologies obsolete, and so on: time and chance happen to them all, as the Good Book says.

    The average material circumstances of even a poor person in the developed world today are so far above what constituted a typical standard of living five or ten centuries ago, that it’s hard to even make a comparison. It is true that, in relative terms, certain genetic lines persist in standing out in a society. OTOH, who listens to the music of Mozart or Bach’s great-grandchildren?

    His arguments are not Marxist, so much as Malthusian-Keynesian in nature. There are periods of fallow economic growth and demographic slowdowns — like the 1930s. But the present-day massive appreciation of fortunes at the high end has everything to do with asset bubbles created by central banks and other government entities. The last 20 years had featured three broad asset bubbles (we’re near the end of the third one) that inflated the wealth of the wealthiest and made inequality more extreme. Artificially low interest rates and constant “liquidity” from central banks makes it very easy for those with a lot of assets to create the illusion of asset prices just going straight up, without a pause. These are all results of bad policy and form the backbone of the cronyistic relationship between governments and their financial industries that dominates developed world politics these days. We’re not richer for these asset bubbles; we just suffer from an illusion of being richer. A lot of paper or electrons is shuffled around, faster and faster, to make it seem so.

    The real story here is something entirely different and has nothing to with inequality or growth. His point of view is that of smug French bureaucrat horrified by how economies actually work and feeling the itch to centrally plan everything, which of course is impossible — but that won’t stop him.

    His proposal to tax wealth (not income) is just as transparent. Across Europe and the developed world, governments and their banking systems are insolvent: that’s the key to understanding why hordes of private wealth “need” to be seized by desperate governments. The “bail-in” of depositors in Cyprus in 2013 is just a foretaste of what is to come. And it won’t stop with just the “wealthy,” my dears. Remember the case of Argentina, in the 1930s one of the world’s wealthiest countries. Where is Argentina now, and how did it get there? Decades of ruinous Peronist populism, backed up by pseudo-intellectual Peronist hacks.

  • bannedforselfcensorship

    I’d imagine one way to reduce income inequality would be to eliminate the tax-free status of muni bonds.

    This would mean people like Sec. Kerry would have to start paying taxes on their fortunes.

    But I guarantee you that the Left will never, ever support this reform. They will claim the cities need that tax-free bonus to their bonds.

    So, guess what? Trust-funders will always have a way to avoid taxes. And it will be paying for the expansion of government.

  • Paul

    One huge element missing in this phony ‘inequality” debate is that the Democrat/ Public Employee Union controlled governments in the big deep blue big cities have through multiple interventions into the market and stifling regulation dramatically raised the cost of living in those cities particularly in Housing, Energy, Transportation, Insurance, and Health Care almost insuring that there will be a great “real” income inequality in those cities.

    A brief review of the cost of living in deep blue cities versus Red State areas will expose this fact.

    To this cost of living mess created by the “Blue Model”, one must add the strangulation of job creation in these very same Blue Cities and of course you will get great income inequality.

    WRM, your attempt at linkage of the South’s racist segregation past and the Tea Party is uncalled for and without merit.

    Our nation is in a deep crisis on multiple fronts. The thievery by the Establishment Republicans and Democrats has reached obscene levels that threaten our very existence. The idea that cronyism and corruption are necessary to “get things done” and turns things around is just utter crap. It is that illegal and unconstitutional cronyism that brought us to this frightening situation.

    According to David Stockman, since the year 2000, we as a nation have lost somewhere between 5 to 6 million ” breadwinner” jobs – that is jobs that make $45,000 and over; while over the same time period approximately 35 million people should have entered the workforce.

    So in other words, we as a nation have not created a single net”good job” in a generation, while tens of millions of Americans have gone without jobs. That should be an enormous national scandal, and should be be splattered over every news report from here to eternity on a daily basis. That it is not is a tribute to the sleazy power of the Establishment.

    Then one does not even have to mention QE, that multi-trillion dollar giveaway to the Big Banks who have at the same time cut lending to small business since 2008 by 10%.

    QE, (Quantitative Easing) which has raised the monetary aggregate by approximately 40% since 2009, is just one of many existential threats to America. The potential for a debt trap is another massive problem, but the list just goes on and on and is too long to go over.

    In short, there is reason for considerable concern for the direction of this country, which is driving force behind the Tea Party – not old racist feelings. I just cannot for the life of me understand those wish to knock those who want to save our way of life in America that is in such dire jeopardy.

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