“Inequality And Self-Righteousness”: President Obama Challenges The Emotional Heart Of Conservative Politics
Here’s a passage from the president’s speech at CAP yesterday, which was a bit of a watershed, consolidating his varying perspectives on inequality and government’s role in the economy:
[W]e need to set aside the belief that government cannot do anything about reducing inequality. It’s true that government cannot prevent all the downsides of the technological change and global competition that are out there right now — and some of those forces are also some of the things that are helping us grow. And it’s also true that some programs in the past, like welfare before it was reformed, were sometimes poorly designed, created disincentives to work, but we’ve also seen how government action time and again can make an enormous difference in increasing opportunity and bolstering ladders into the middle class. Investments in education, laws establishing collective bargaining and a minimum wage — (applause) — these all contributed to rising standards of living for massive numbers of Americans.
Likewise, when previous generations declared that every citizen of this country deserved a basic measure of security, a floor through which they could not fall, we helped millions of Americans live in dignity and gave millions more the confidence to aspire to something better by taking a risk on a great idea. Without Social Security nearly half of seniors would be living in poverty — half. Today fewer than 1 in 10 do. Before Medicare, only half of all seniors had some form of health insurance. Today virtually all do. And because we’ve strengthened that safety net and expanded pro-work and pro- family tax credits like the Earned Income Tax Credit, a recent study found that the poverty rate has fallen by 40 percent since the 1960s.
What he’s doing here is challenging the idea that you can defend the “good” government interventions in the economy that are now part of the national landscape while opposing contemporary efforts to expand opportunity and reduce inequality. This strikes directly at the politics of selfishness and self-righteousness that is at the emotional heart of conservative politics at present.
The opportunity gap in America is now as much about class as it is about race. And that gap is growing. So if we’re going to take on growing inequality and try to improve upward mobility for all people, we’ve got to move beyond the false notion that this is an issue exclusively of minority concern. And we have to reject a politics that suggests any effort to address it in a meaningful way somehow pits the interests of a deserving middle class against those of an undeserving poor in search of handouts.
This can’t be said too often.
By: Ed Kilgore, Contributing Writer, Washington Monthly Political Animal, December 5, 2013
“Better Pay Now”: Let’s Give It A Try For The Person On The Other Side Of The Cash Register
’Tis the season to be jolly — or, at any rate, to spend a lot of time in shopping malls. It is also, traditionally, a time to reflect on the plight of those less fortunate than oneself — for example, the person on the other side of that cash register.
The last few decades have been tough for many American workers, but especially hard on those employed in retail trade — a category that includes both the sales clerks at your local Walmart and the staff at your local McDonald’s. Despite the lingering effects of the financial crisis, America is a much richer country than it was 40 years ago. But the inflation-adjusted wages of nonsupervisory workers in retail trade — who weren’t particularly well paid to begin with — have fallen almost 30 percent since 1973.
So can anything be done to help these workers, many of whom depend on food stamps — if they can get them — to feed their families, and who depend on Medicaid — again, if they can get it — to provide essential health care? Yes. We can preserve and expand food stamps, not slash the program the way Republicans want. We can make health reform work, despite right-wing efforts to undermine the program.
And we can raise the minimum wage.
First, a few facts. Although the national minimum wage was raised a few years ago, it’s still very low by historical standards, having consistently lagged behind both inflation and average wage levels. Who gets paid this low minimum? By and large, it’s the man or woman behind the cash register: almost 60 percent of U.S. minimum-wage workers are in either food service or sales. This means, by the way, that one argument often invoked against any attempt to raise wages — the threat of foreign competition — won’t wash here: Americans won’t drive to China to pick up their burgers and fries.
Still, even if international competition isn’t an issue, can we really help workers simply by legislating a higher wage? Doesn’t that violate the law of supply and demand? Won’t the market gods smite us with their invisible hand? The answer is that we have a lot of evidence on what happens when you raise the minimum wage. And the evidence is overwhelmingly positive: hiking the minimum wage has little or no adverse effect on employment, while significantly increasing workers’ earnings.
It’s important to understand how good this evidence is. Normally, economic analysis is handicapped by the absence of controlled experiments. For example, we can look at what happened to the U.S. economy after the Obama stimulus went into effect, but we can’t observe an alternative universe in which there was no stimulus, and compare the results.
When it comes to the minimum wage, however, we have a number of cases in which a state raised its own minimum wage while a neighboring state did not. If there were anything to the notion that minimum wage increases have big negative effects on employment, that result should show up in state-to-state comparisons. It doesn’t.
So a minimum-wage increase would help low-paid workers, with few adverse side effects. And we’re talking about a lot of people. Early this year the Economic Policy Institute estimated that an increase in the national minimum wage to $10.10 from its current $7.25 would benefit 30 million workers. Most would benefit directly, because they are currently earning less than $10.10 an hour, but others would benefit indirectly, because their pay is in effect pegged to the minimum — for example, fast-food store managers who are paid slightly (but only slightly) more than the workers they manage.
Now, many economists have a visceral dislike of anything that sounds like price-fixing, even if the evidence strongly indicates that it would have positive effects. Some of these skeptics oppose doing anything to help low-wage workers. Others argue that we should subsidize, not regulate — in particular, that we should expand the Earned Income Tax Credit (E.I.T.C.), an existing program that does indeed provide significant aid to low-income working families. And for the record, I’m all for an expanded E.I.T.C.
But there are, it turns out, good technical reasons to regard the minimum wage and the E.I.T.C. as complements — mutually supportive policies, not substitutes. Both should be increased. Unfortunately, given the political realities, there is no chance whatsoever that a bill increasing aid to the working poor would pass Congress.
An increase in the minimum wage, on the other hand, just might happen, thanks to overwhelming public support. This support doesn’t come just from Democrats or even independents; strong majorities of Republicans (57 percent) and self-identified conservatives (59 percent) favor an increase.
In short, raising the minimum wage would help many Americans, and might actually be politically possible. Let’s give it a try.
By: Paul Krugman, Op-Ed Columnist, The New York Times, December 1, 2013
“The Deal With Rich People”: America Has A Long Standing Bad Deal With The Wealthy
Americans aren’t so sure about rich people.
For every revered Steve Jobs, there’s a reviled Bernie Madoff; for every folksy Warren Buffett, there’s a tone-deaf Mitt Romney. The pursuit of happiness is patriotic, but the pursuit of riches can come off as greedy. This ambivalence toward the wealthy is embedded in American democracy, and no one knows how to yank it out.
Even Alexis de Tocqueville agreed — a good thing, too, because discussing democracy in America without quoting “Democracy in America” is forbidden. “Men are there seen on a greater equality in point of fortune . . . than in any other country in the world, or in any age of which history has preserved the remembrance,” Tocqueville wrote of his travels in the United States. But then, the dagger: “I do not mean that there is any lack of wealthy individuals in the United States. I know of no country, indeed, where the love of money has taken stronger hold.”
So Americans dislike inequality but crave wealth — and this paradox propels our mixed feelings about the rich. Oppressors or job creators? Ambitious go-getters or rapacious 1 percenters?
Robert F. Dalzell, a historian at Williams College, believes he has an answer. America has a long-standing deal with the rich, he explains, one that allows the country to “forge an accommodation between wealth and democracy.” It’s simple: Yes, rich people, you can exploit workers and natural resources and lord your wealth over everyone if you like, and we’ll resent you for it. But if, along the way, you give a chunk of your fortune to charity, all will be forgiven, old sport. History won’t judge you as a capitalist; it will hail you as a philanthropist.
This uneasy bargain is the premise of Dalzell’s “The Good Rich and What They Cost Us,” which chronicles the deal from before the revolution through the recent financial crisis. Of course, just because the deal has lasted this long doesn’t mean that it will endure. Or that it is a particularly good one. Or that the rich aren’t constantly trying to rewrite the terms.
Early on, the wealthy waited until their deaths to strike the deal. Dalzell writes of Robert Keayne, a prominent 17th-century Boston merchant who sought to cleanse his price-gouging reputation by devoting his posthumous riches to college scholarships, improvements in his city’s water supply and defense, and construction of a town hall where important men like him could discuss weighty things. His will became a unilateral contract with town leaders; if anyone tried to sue his estate for past misdeeds, Keayne stipulated, all his giving would “utterly cease and become void.” Boston took the deal.
John D. Rockefeller saw no reason to wait. His Standard Oil empire — whose ruthless business tactics Ida Tarbell exposed and whose interlocking parts the Supreme Court split up — became the basis for the greatest philanthropic enterprise the world had ever seen. From major financial commitments to Spellman College and the University of Chicago, to support for medical research that developed the yellow-fever vaccine, to the financing of the Cloisters museum in Upper Manhattan and the restoration of Colonial Williamsburg, to list just a few initiatives, Rockefeller and his descendants set the model for modern, large-scale philanthropy. And they did so in a way that preserved the family’s influence and wealth over multiple generations.
“There was something Medici-like about the whole effort,” Dalzell writes, “for within the soul of that great Renaissance family there lay an urge to combine what many might have thought uncombinable — vast wealth and dedicated public service.”
But he also sees a more prosaic motivation: Billionaires want to polish their reputations for posterity. Wealth does not dull their sensitivity to what we think of them; it heightens it. Dalzell thinks it is no coincidence, for example, that the Giving Pledge — a public commitment by the world’s richest individuals, led by Buffett and Bill Gates, to donate most of their fortunes — coincided with the Great Recession’s backlash against the wealthy.
So, the rich just want to be loved. Is that so wrong? If more than 100 of the planet’s wealthiest families and individuals are promising to give away unfathomable amounts of money, why quibble?
Well, there’s at least one reason: The deal gets worse as the price paid for the rich’s charity — the inequality between the affluent and the rest — keeps rising. From 1979 to 2007, the real, after-tax income of the top 1 percent of the U.S. population grew by 275 percent, compared with 18 percent for the bottom fifth, according to the Congressional Budget Office. Social mobility has become more stunted in the United States than in Europe. And Americans see themselves falling further behind: A Washington Post-ABC News poll last year found that 57 percent of registered voters believed that the gap between the rich and rest was larger than it had been historically; only 5 percent thought it was smaller.
The deal will get even worse if efforts to push laws and policies that benefit wealthier Americans succeed. In “Rich People’s Movements,” Isaac William Martin, a sociologist at the University of California at San Diego, says today’s tea party is just the latest manifestation of another American tradition: the mobilization of wealthy and middle-class citizens in an effort to cut their taxes and contributions to the state.
Before the tea party, Martin tells us, there were tax clubs — groups of bankers throughout the South that agitated for tax cuts and helped bring about the Revenue Act of 1926, which “cut the tax rates on the richest Americans more deeply than any other tax law in history.” Before we had Grover Norquist and Americans for Tax Reform, we had J.A. Arnold and the American Taxpayers’ League, and Vivien Kellems and the Liberty Belles, a 1950s women’s movement that campaigned to repeal the income tax. And before Arthur Laffer and supply-side economics, there was Andrew Mellon, the banker, philanthropist and Treasury secretary whose 1924 book, “Taxation: The People’s Business,” argued that cutting income tax rates would create more revenue through greater economic growth.
Rich people’s movements respond to perceived threats, such as the New Deal, President Franklin Roosevelt’s effort to cap incomes during World War II (because “all excess income should go to win the war,” FDR explained) or, now, the policies of the Obama administration. But these movements sell their efforts not as benefiting the rich alone — that would be too transparent, too tacky. Instead, they claim to protect freedom, promote growth, safeguard the Constitution or fend off an ever-more-intrusive government. Martin calls this “strategic policy crafting,” and it brings more allies to the fight.
In fact, it is not just the wealthy, but often the middle class or the slightly-richer-than-average who have campaigned for lower taxes on affluent Americans. “People need not be dupes in order to protest on behalf of others who are richer than they are,” Martin argues. “The activists and supporters of rich people’s movements were defending their own real interests, as they saw them. A tax increase on the richest 1 percent may be perceived by many upper-middle-income property owners as the first step in a broader assault on property rights.” In other words, there’s nothing the matter with Kansas.
Shortly before the Republican National Convention gathered last year to nominate a man who could have become one of the richest presidents in U.S. history, the Pew Research Center conducted a survey on American attitudes toward the wealthy. The chronic ambivalence was there: Forty-three percent of respondents said rich people are more likely than the average American to be intelligent, and 42 percent believed that the rich worked harder than everyone else. The good rich! But 55 percent said wealthy people were more likely to be greedy, and 34 percent thought they were less likely to be honest. The bad rich.
Can “giving pledges” and foundation grants sustain America’s deal with the wealthy in a time of increasing inequality and falling social mobility? In his conclusion, Dalzell worries that the belief in the generosity of the good rich leads us to “tolerate, even celebrate, the violation of some of our most cherished ideals” of fairness and egalitarianism.
Perhaps the dilemma of extreme wealth and disparities in a democracy is that noblesse oblige becomes necessary. These two books show that the wealthy give much with one hand but seek to contribute far less with the other. That makes the giving they choose to do all the more critical but all the less accountable.
And that doesn’t sound like such a good deal.
By: Carlos Lozada, Outlook Editor, The Washington Post, November 27, 2013
“A Pope’s Pointed Message”: Our Sacred Responsibility Is To One Another
“Some people continue to defend trickle-down theories, which assume that economic growth, encouraged by a free market, will inevitably succeed in bringing about greater justice and inclusiveness in the world. This opinion, which has never been confirmed by the facts, expresses a crude and naive trust in the goodness of those wielding economic power and in the sacralized workings of the prevailing economic system. Meanwhile, the excluded are still waiting.”
That passage is not from some Occupy Wall Street manifesto. It was written by Pope Francis in a stunning new treatise on the Catholic Church’s role in society — and it is a powerful reminder that, however tiresome the political trench warfare in Washington may be, we have a duty to fight on.
The full implementation of Obamacare matters. Raising the minimum wage matters. Reforming a financial system that, as Francis noted, “rules rather than serves” matters. Hearing the anguished voices of those left hopeless by poverty matters; answering their pleas with education, health care and employment matters even more.
Francis, the first Jesuit and first non-European in the modern era to be named pope, clearly intends to make a real difference in the world — too much of a difference, it appears, for some conservatives: Sarah Palin, a born-again Christian who attends a nondenominational church, said recently that Francis’s open-arms attitude on social issues “has taken me aback.” Would that a few more words might take her all the way aback to the obscurity from which she came.
Francis’s remarks on economics and poverty came in a 50,000-word Apostolic Exhortation, released Tuesday, that gives the clearest vision to date of how he sees the church and how he intends to reshape it. In its boldness, the statement suggests that, just as Pope John Paul II played a political role in the fall of communism, so might Francis try to help shape events by obliging the faithful to recognize, and resist, a growing pattern of inequality throughout the world.
“To sustain a lifestyle which excludes others, or to sustain enthusiasm for that selfish ideal, a globalization of indifference has developed,” Francis wrote. “Almost without being aware of it, we end up being incapable of feeling compassion at the outcry of the poor, weeping for other people’s pain, and feeling a need to help them, as though all this were someone else’s responsibility and not our own. The culture of prosperity deadens us; we are thrilled if the market offers us something new to purchase; and in the meantime all those lives stunted for lack of opportunity seem a mere spectacle; they fail to move us.”
Francis explicitly calls for “financial reform,” though he wisely does not lay out a policy agenda. But in a passage likely to make libertarians want to hide amid the dense thickets of Ayn Rand’s prose, where no light can penetrate, Francis wrote that “the private ownership of goods is justified by the need to protect and increase them, so that they can better serve the common good; for this reason, solidarity must be lived as the decision to restore to the poor what belongs to them.”
The basic positions Francis takes on economic and social justice are not new; all recent popes have expressed a similar critique of modern capitalist society, including John Paul II, whose views on poverty and the need for community are often conveniently overlooked by those who would paint him as Ronald Reagan in robes.
But no recent pope has been so forceful in denouncing the “idolatry of money” and making the inexorable rise of inequality one of the church’s central concerns. Francis intends his message to be heard. I hope leaders everywhere, and especially in Washington, are listening.
Jesus commanded his apostles to give to the poor. Yet many elected officials who claim to follow Jesus’s teachings are determined to keep the poor from receiving health care, food assistance, housing subsidies and a host of other benefits. Inequality is celebrated as a virtue. Life, we are told with a shrug, is sometimes unfair.
But for Christians, Francis reminds us, life is supposed to be as fair and compassionate as we can make it. Money is a false idol, a golden calf. Our sacred responsibility is to one another.
Amen, Your Holiness. Amen.
By: Eugene Robinson, Opinion Writer, The Washington Post, November 28, 2013
“Confronting The Pathologies Of Poverty:” Do We Invest In Preschools Or Prisons?
Congress is often compared to pre-K, which seems defamatory of small children. But the similarities also offer hope, because an initiative that should be on the top of the national agenda has less to do with the sequester than with the A.B.C.’s and Big Bird.
Growing mountains of research suggest that the best way to address American economic inequality, poverty and crime is — you guessed it! — early education programs, including coaching of parents who want help. It’s not a magic wand, but it’s the best tool we have to break cycles of poverty.
President Obama called in his State of the Union address for such a national initiative, but it hasn’t gained traction. Obama himself hasn’t campaigned enough for it, yet there’s still a reed of hope.
One reason is that this is one of those rare initiatives that polls well across the spectrum, with support from 84 percent of Democrats and 60 percent of Republicans in a recent national survey. And even if the program stalls in Washington, states and localities are moving ahead — from San Antonio to Michigan. Colorado voters will decide next month on a much-watched ballot measure to bolster education spending, including in preschool, and a ballot measure in Memphis would expand preschool as well.
“There’s this magical opportunity” now to get a national early education program in America, Education Secretary Arne Duncan told me. He says he’s optimistic that members of Congress will introduce a bipartisan bill for such a plan this year.
“When you think how you make change for the next 30 years, this is arguably at the top of my list,” Duncan said. “It can literally transform the life chances of children, and strengthen families in important ways.”
Whether it happens through Congressional action or is locally led, this may be the best chance America has had to broaden early programs since 1971, when Congress approved such a program but President Nixon vetoed it.
The massive evidence base for early education grew a bit more with a major new study from Stanford University noting that achievement gaps begin as early as 18 months. Then at 2 years old, there’s a six-month achievement gap. By age 5, it can be a two-year gap. Poor kids start so far behind when school begins that they never catch up — especially because they regress each summer.
One problem is straightforward. Poorer kids are more likely to have a single teenage mom who is stressed out, who was herself raised in an authoritarian style that she mimics, and who, as a result, doesn’t chatter much with the child.
Yet help these parents, and they do much better. Some of the most astonishing research in poverty-fighting methods comes from the success of programs to coach at-risk parents — and these, too, are part of Obama’s early education program. “Early education” doesn’t just mean prekindergarten for 4-year-olds, but embraces a plan covering ages 0 to 5.
The earliest interventions, and maybe the most important, are home visitation programs like Nurse-Family Partnership. It begins working with at-risk moms during pregnancy, with a nurse making regular visits to offer basic support and guidance: don’t drink or smoke while pregnant; don’t take heroin or cocaine. After birth, the coach offers help with managing stress, breast-feeding and diapers, while encouraging chatting to the child and reading aloud.
These interventions are cheap and end at age 2. Yet, in randomized controlled trials, the gold standard of evaluation, there was a 59 percent reduction in child arrests at age 15 among those who had gone through the program.
Something similar happens with good pre-K programs. Critics have noted that with programs like Head Start, there are early educational gains that then fade by second or third grade. That’s true, and that’s disappointing.
Yet, in recent years, long-term follow-ups have shown that while the educational advantages of Head Start might fade, there are “life skill” gains that don’t. A rigorous study by David Deming of Harvard, for example, found that Head Start graduates were less likely to repeat grades or be diagnosed with a learning disability, and more likely to graduate from high school and attend college.
Look, we’ll have to confront the pathologies of poverty at some point. We can deal with them cheaply at the front end, in infancy. Or we can wait and jail a troubled adolescent at the tail end. To some extent, we face a choice between investing in preschools or in prisons.
We just might have a rare chance in the next couple of months to take steps toward such a landmark early education program in America. But children can’t vote, and they have no highly paid lobbyists — so it’ll happen only if we the public speak up.
By: Nicholas D. Kristof, Op-Ed Contributor, The New York Times, October 26, 2013
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