“Too Much Capital In Too Few Hands”: Populist Backlash Will Keep Increasing As Inequality Continues To Rise
Listen to a typical center-left Democrat, and you’ll hear rosy things about the economy. GDP growth is solid, unemployment is low, and even wages are starting to rise. The Clinton campaign and the Democratic Party generally will be touting these achievements even as they focus on issues of structural racism and sexism while offering government support in areas like childcare.
But there’s a big problem: overall, inequality is still rising at an astonishing rate to unprecedented levels:
Financial inequality became even wider in the United States last year, with average income for the top 1% of households surging 7.7% to $1.36 million.
Income for the richest sliver rose twice as fast as it did for the remaining 99% of households, according to an updated analysis of tax data by Emmanuel Saez, an economics professor at the University of California, Berkeley.
It’s true that the 99% is doing better than it has since the 1990s, but the gains are relatively modest. Furthermore, basic cost of living has gone way up, particularly in the areas of tuition and housing. Housing in particular is a major problem driven by inequality itself: with accumulation of capital comes the need for places to store it, and real estate is a popular piggybank for wealthy investors. This in turn drives up the cost of housing, making it more difficult to afford housing in the urban areas where most jobs are located.
The bigger problem is that America already tried the 1990s approach to prosperity, assuming that rising inequality isn’t a problem as long as everyone is doing OK. What does it matter if the rich are getting much much richer, if the fortunes of the poor and the middle class are also improving even if at a slower rate?
The answer is that it’s unsustainable in both the short and long term. Over the long term high rates of inequality shrink the middle class and increase political instability. In the short term, too much capital in too few hands leads to speculative bubbles, that in turn lead to big recessions. Recessions tend to wipe out the wealth of the middle class in a much more devastating way than that of the wealthy who have more ways to protect their money. More importantly, the wealthy recover their position much more quickly as asset values balloon back, but the jobs that sustain the middle class and the poor return more slowly–often at permanently lower wage levels when adjusted for inflation.
Automation and globalization are likely to inexorably drive the trend toward rampant inequality, exacerbated by tax policy designed to protect the wealthy and overgrown financial sector. Merely tackling structural racist and sexist inequalities will do good in their own ways for women and minorities, but they will do little to address the overall problem. Targeted government programs to help citizens with childcare and other needs will help somewhat but won’t do much to fix what’s fundamentally wrong.
Only much more aggressive policies that give workers a greater say in how companies are run to “pre-distribute” wealth, as well as much more progressive graduated tax policies that distribute uneven gains more equitably, will ultimately tilt the balance back toward the middle class where it belongs. Until then, expect to see increasingly virulent strains of populist backlash from both the right and the left until something changes. Incrementalism may be all that is possible politically, but it’s not an answer for the problems that beset us and give rise to anxious backlash. As long as inequality rises, Donald Trump, Brexit and ISIS will be just the beginning of the world’s back-to-basics nativist woes.
People don’t just want the 99% to do better. As the 1% continues to outpace everyone else, a great many people in America and the world actively want the 1% to do worse. And it’s hard to blame them for that sentiment.
By: David Atkins, Political Animal Blog, The Washington Monthly, July 4, 2016
“Acts Of Journalistic Malpractice”: Email Servers Are Just The Latest Manufactured Scandal
You read it here first: “Fearless prediction,” this column began last April 6: “No legalistic deus ex machina will descend to save the nation from the dread specter of President Hillary Rodham Clinton…no Kenneth Starr-style ‘independent’ prosecutor, no criminal indictment over her ‘damn emails,’ no how, no way.
“Ain’t gonna happen…
“Those impassioned Trump supporters holding ‘Hillary for Prison’ signs are sure to be disappointed. Again. Played for suckers by a scandal-mongering news media that declared open season on Clinton 25 years ago. And haven’t laid a glove on her yet.”
If they wanted to prevent Hillary from taking the oath of office next January, I wrote, voters were “going to have to do it the old-fashioned way: defeat her at the polls.”
As of this writing, that’s not looking too likely either. Minutes before the news broke that FBI Director James B. Comey announced that “no reasonable prosecutor” would bring criminal charges against Secretary Clinton, I’d made an observation to a Republican friend on Facebook regarding his expressed wish to see her jailed.
“As a personal matter,” I wrote, “you wouldn’t trust Trump to walk your dog.” After Comey’s announcement, he groused that Hillary had friends in high places, but didn’t dispute my characterization of Trump. Although we disagree politically, I’d trust my friend with anything requiring honesty and steadfastness—dog-walking, cow-feeding, anything at all.
I see Trump, I keep my hand on my wallet. Seen that bizarre interview on Lives of the Rich and Famous where Trump speculates about the eventual size of his infant daughter’s breasts?
No? Then read on USA Today about the thousands of contractors—carpenters, plumbers, electricians–Trump’s stiffed on construction jobs. You do the work, he doesn’t pay. Even his own lawyers sometimes.
The man’s been sued 3500 times. Think he gives a damn about you?
So anyway, last week saw the collapse of not one, but two ballyhooed Hillary Clinton investigations. Even after two years, $7 million and 800-odd pages, Rep. Trey Gowdy’s celebrated Benghazi committee—the eighth of its kind—failed to come up with hurtful new evidence against Secretary Clinton in the tragic events in Libya on September 11, 2012.
But then that wasn’t necessarily the point.
“Everybody thought Hillary Clinton was unbeatable, right? But we put together a Benghazi special committee, a select committee,” GOP Majority Leader Kevin McCarthy boasted last September. “What are her numbers today? Her numbers are dropping. Why? Because she’s untrustable.”
So the committee folds its cards, Bill Clinton does his happy Labrador retriever act on Attorney General Loretta Lynch’s airplane, and The Washington Post says we’re nevertheless back to Square One: “Can Hillary Clinton Overcome Her Trust Problem?” reporter Anne Gearan asks.
Clinton herself acknowledges that voters don’t see her as Miss Congeniality. She says she’s working hard to overcome that impression, but acknowledges it’s an uphill struggle.
“You know, you hear 25 years’ worth of wild accusations, anyone could start to wonder…Political opponents and conspiracy theorists have accused me of every crime in the book. None of it’s true, never has been, but it also never goes away,” Clinton told the Post.
“And it certainly is true that I’ve made mistakes. I don’t know anyone who hasn’t,” Clinton continued. “So I understand that people have questions.”
Indeed many of those “questions” about Hillary’s dishonesty originated in acts of journalistic malpractice so crude that their authors would have been shamed out of the profession—if the profession had any shame at the Washington pundit level.
Back in December 1995, ABC’s Nightline broadcast a doctored video clip that made Hillary appear to be lying about representing a Whitewater savings and loan. In reality, she’d explained her role as billing attorney on the account. No wonder “the White House was so worried about what was in Vince Foster’s office when he killed himself,” Jeff Greenfield observed, an insinuation as ugly as it was false.
Her imminent indictment was widely predicted.
A few months later, financial journalist James B. Stewart appeared on the same program, promoting his farcically inaccurate book “Blood Sport.” (He’d failed to read the Treasury Department’s “Pillsbury Report” and taken soon-to-be-convicted Jim McDougal’s word for everything.) Stewart gravely produced a loan application he alleged that Hillary had falsified, a federal crime, he said.
Joe Conason noticed something at the bottom of the page: “(BOTH SIDES OF THIS DOCUMENT MUST BE COMPLETED.)” Sure enough, Stewart had neglected to examine page two of a two page application.
Oops, hold the handcuffs and the orange jumpsuit.
If you think Stewart’s career suffered, you must not read the New York Times or the New Yorker.
Anyway, nothing’s really changed. Paradoxically, the collapse of one ballyhooed Clinton “scandal” after another appears to have hurt her. Few follow the details. But people suspect that she must be especially cunning and slippery to keep getting away with it, the bitch.
By: Gene Lyons, The National Memo, July 5, 2016
“Politically Inconvenient Truths”: Gingrich Shows How Far He’ll Go To Be Vice President
One month ago today, Newt Gingrich was asked to comment on Donald Trump’s racist remarks about Judge Gonzalo Curiel, and the former House Speaker was surprisingly candid. “This is one of the worst mistakes Trump has made,” Gingrich said, adding that the presidential hopeful’s comments were “inexcusable.”
A few days later, however, the Georgia Republican remembered that he might be a top contender to become Trump’s running mate – which led Gingrich to walk back everything he’d just said. The former Speaker told CNN that Trump is “learning very, very fast” and taking the necessary steps “to win the presidency.”
What about Trump’s “inexcusable” mistake? “Any effort to take one or two phrases out of the 90-minute dialogue and say, ‘Gee, Gingrich was anti-Trump,’ is just nonsense,” he said.
Late last week, as Politico noted, we saw a related shift.
Former Speaker Newt Gingrich, under consideration as Donald Trump’s running mate, is dropping his decades-long support of free trade deals and picking up Trump’s strongly protectionist position.
“I basically agree with Trump’s speech on trade,” Gingrich said in an email to POLITICO on Friday.
Gingrich wasn’t just a passive proponent of modern trade agreements; he championed many of the trade deals Trump is now running against. Trump, for example, has repeatedly condemned NAFTA, which Gingrich not only voted, he also literally stood alongside then-President Bill Clinton when it was signed into law.
Slate’s Josh Voorhees added that Gingrich continued to voice support for trade agreements after he was driven from Congress, including having been “a vocal cheerleader of permanent trade relations with China.”
That is, until Gingrich decided he had a shot at the VP slot, at which point he discovered he “basically agrees” with the presidential candidate he’s eager to impress.
So, here’s my question: if the vice presidential nomination goes to someone else, will Gingrich go back to his previous beliefs or stick with these politically convenient new ones?
By: Steve Benen, The Maddow Blog, June 5, 2016
“Trump Is Mishandling The Clinton Email Controversy”: Insisting Repeatedly That The Investigation Was Rigged
At Think Progress, Ian Millhiser helpfully explains why Hillary Clinton won’t be facing any criminal charges for her use of a private email server while serving as Secretary of State. There are a lot of legal issues and precedents to discuss, but it can all be boiled down to one simple thing.
Setting aside the bare language of the law, there’s also a very important practical reason why officials in Clinton’s position are not typically indicted. The security applied to classified email systems is simply absurd. For this reason, a former CIA general counsel told the Washington Post’s David Ignatius, “’it’s common’ that people end up using unclassified systems to transmit classified information.” “’It’s inevitable, because the classified systems are often cumbersome and lots of people have access to the classified e-mails or cables.’ People who need quick guidance about a sensitive matter often pick up the phone or send a message on an open system. They shouldn’t, but they do.”
Indicting Clinton would require the Justice Department to apply a legal standard that would endanger countless officials throughout the government, and that would make it impossible for many government offices to function effectively.
That’s the bottom line.
Of course, Clinton was not exonerated. FBI Director James Comey was scathing at times in his criticism, and would not even guarantee that the former Secretary of State’s emails hadn’t been read by foreign and hostile intelligence agencies.
With respect to potential computer intrusion by hostile actors, we did not find direct evidence that Secretary Clinton’s personal e-mail domain, in its various configurations since 2009, was successfully hacked. But, given the nature of the system and of the actors potentially involved, we assess that we would be unlikely to see such direct evidence. We do assess that hostile actors gained access to the private commercial e-mail accounts of people with whom Secretary Clinton was in regular contact from her personal account. We also assess that Secretary Clinton’s use of a personal e-mail domain was both known by a large number of people and readily apparent. She also used her personal e-mail extensively while outside the United States, including sending and receiving work-related e-mails in the territory of sophisticated adversaries. Given that combination of factors, we assess it is possible that hostile actors gained access to Secretary Clinton’s personal e-mail account.
There’s been a lot of hype about these damn emails, but Clinton deserves some criticism. She did not get a clean bill of health here, and the subject will be a legitimate issue during the campaign. That doesn’t mean that Donald Trump has handled the controversy with any deftness. By insisting repeatedly that the investigation was rigged, he undermined the case he should be making now, which is that the FBI is credible and should be taken seriously. But, instead, he’s still saying that the investigation was rigged.
That’s basically taking a weak, contentious and conspiratorial case in place of one that is backed up by the investigators. It’s particularly stupid because, now that we know that no charges will be filed, this is an entirely political controversy. And the object, for Trump, should be to get the maximum possible political mileage out of it. He could be making the case that Clinton shouldn’t be trusted to handle the nation’s national security because she did a poor job of safeguarding its secrets when she served in the Obama administration, but he’s instead saying that the FBI engaged in a coverup.
Consider that James Comey was confirmed by the Senate on July 29, 2013 as the director of the FBI for a term of ten years. If Donald Trump becomes president and serves for two full terms, his presidency will end on January 20th, 2025. In other words, Comey would be the FBI Director for all but the last 18 months of a Trump presidency. And, yet, Trump’s reaction to Comey’s statement today is to question his integrity and independence and to run down the organization that Comey heads.
It’s not hard to see that this isn’t the beginning of a good working relationship, and at least some voters will notice this and be concerned about it.
Trump will rile up some people who were already convinced that Clinton is a she-devil, but he won’t get much else out of this if he continues to shift the focus off of where it can help him make a case against his opponent.
The truth is, she should not have been indicted and most people will agree that the correct decision was made. So, focusing on the decision is actually doing her a giant favor.
By: Martin Longman, Political Animal Blog, The Washington Monthly, July 5, 2016
“Trump Flunks Supreme Court Arithmetic”: Counting To Five Should Be Pretty Easy, Unless You’re Donald Trump
For the typical adult, counting to five should be pretty easy. It makes Donald Trump’s trouble with Supreme Court arithmetic that much more puzzling.
On Monday, the Supreme Court handed down arguably the most important abortion-rights ruling in a generation, prompting the Republican presidential hopeful to say … literally nothing. To the consternation of some of his social-conservative allies, Trump acted as if the court’s decision didn’t exist, offering no response in speeches, interviews, or social media.
It took a few days, but this morning the presumptive GOP nominee broke his unexpected silence in an interview with conservative radio host Mike Gallagher.
“Now if we had Scalia was living, or if Scalia was replaced by me, you wouldn’t have had that, OK? It would’ve been the opposite.”
Actually, no, it wouldn’t have. This week’s ruling was actually a 5-3 decision. Yes, Antonin Scalia’s passing meant the Supreme Court was down one justice, but it doesn’t take a mathematician to know 3 +1 does not equal 5.
Remember, the decision was on Monday, and today’s Thursday. Trump and his team had three days to come up with the candidate’s response to a major court ruling, and this is what they came up with.
In the same interview, the New York Republican complained about Chief Justice John Roberts, telling the host, “He could’ve killed [the Affordable Care Act] twice and he didn’t. That was terrible. And that was a Bush appointment. That was so bad, what happened. And you know, to me, you know, almost not recoverable from his standpoint. Very, very sad situation.”
Actually, the second time the justices considered the constitutionality of “Obamacare,” the law was upheld in a 6-3 ruling. When Trump said today Roberts “could’ve killed” the ACA, his math is still wrong – because 6 – 1 does not equal four.
Do you ever get the impression that Trump hasn’t really thought this issue through? Ever wonder if there’s an issue he has thought through?
Postscript: Trump’s math troubles notwithstanding, the GOP candidate, who used to describe himself as pro-choice, continues to talk about how eager he is to restrict reproductive rights. In this morning’s interview, the host added, “So just to confirm, under a Donald, a President Donald Trump-appointed Supreme Court, you wouldn’t see a majority ruling like the one we had with the Texas abortion law this week.”
The candidate replied, “No, you wouldn’t see that.”
By: Steve Benen, The Maddow Blog, June 30, 2016
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