US President Barack Obama calls inequality the “defining challenge of our era.” Polls show that a majority of Americans now believe that inequality has grown over the past decade and favor tax increases on the wealthy to help the poor.
The non-partisan Pew Research Center recently found that six out of 10 Americans believe that their economic system unfairly favors the wealthy.
So what is the reaction of conservatives to this? They want to change the subject. Those with presidential ambitions say the focus should be on poverty rather than inequality. US Senator Marco Rubio points to the “lack of mobility” of the poor as the core problem, while US Representative Paul Ryan blames their isolation from the mainstream of the country.
“On every measure from education levels to marriage rates, poor families are drifting further away from the middle class,” Ryan said.
Conservative New York Times columnist David Brooks argues that the “interrelated social problems of the poor” have nothing to do with inequality and even some Democratic operatives are worried that talking about inequality will turn off voters.
“However salient reducing income inequality may be, it is demonstrably less important to voters than any number of other priorities” — including reducing poverty — Democratic pollster Mark Mellman wrote.
This is rubbish; widening inequality is making it harder for the poor to escape poverty and thwarting equal opportunity. Let me explain: When almost all the gains from growth go to the top, as they have for the past 30 years, the vast middle class does not have the purchasing power necessary to keep the economy growing and generate lots of jobs.
Once the middle class has exhausted all of its coping mechanisms — wives and mothers surging into paid work (as they did in the 1970s and 1980s), longer working hours (which characterized the 1990s) and deep indebtedness (from 2002 to 2008) — the inevitable result is slower growth and fewer jobs.
Slow growth and few jobs hit the poor especially hard because they are the first to be fired, last to be hired and most likely to bear the brunt of declining wages and benefits.
A stressed middle class also has a harder time being generous to those in need. It is no coincidence that the tax revolts that began thundering across the US in the late 1970s occurred just when middle-class wages began stagnating. Helping the poor presumably requires money, but the fiscal cupboard is bare and the only way to replenish it is through tax increases on the wealthy, because the middle class is stretched to the limit. The shrinking middle class also hobbles upward mobility, because not only is there less money for good schools, job training and social services, but the poor also face more difficulty moving upward because the income ladder is far longer and its middle rungs have disappeared.
US conservatives also do not want to acknowledge any connection between widening inequality and unequal political power. For example, Brooks warns that any discussion of unequal political power will make it harder to reach political consensus over what to do for the poor.
Yet it is precisely the concentration of power at the top — which flows largely from the concentration of income and wealth there — that has prevented Washington from dealing with the problems of the poor and the middle class.
As wealth has accumulated at the top, Washington has reduced taxes on the wealthy, expanded loopholes that disproportionately benefit the rich, deregulated Wall Street and provided ever larger subsidies, bailouts and tax breaks for large corporations. The only things that have trickled down to the middle and the poor — besides fewer jobs and lower salaries — are public services that are increasingly inadequate because they are starved of funds.
Unequal political power is the endgame of widening inequality; its most noxious and nefarious consequence. Big money has all but engulfed Washington and many state capitals, drowning out the voices of average Americans, filling the campaign chests of candidates who will do their bidding, financing attacks on organized labor and bankrolling a vast empire of right-wing think tanks and publicists that fill the airwaves with half-truths and distortions.
Robert Reich is a former US secretary of labor.
Could Asia be on the verge of a new wave of nuclear proliferation? A look back at the early history of the North Atlantic Treaty Organization (NATO), which recently celebrated its 75th anniversary, illuminates some reasons for concern in the Indo-Pacific today. US Secretary of Defense Lloyd Austin recently described NATO as “the most powerful and successful alliance in history,” but the organization’s early years were not without challenges. At its inception, the signing of the North Atlantic Treaty marked a sea change in American strategic thinking. The United States had been intent on withdrawing from Europe in the years following
My wife and I spent the week in the interior of Taiwan where Shuyuan spent her childhood. In that town there is a street that functions as an open farmer’s market. Walk along that street, as Shuyuan did yesterday, and it is next to impossible to come home empty-handed. Some mangoes that looked vaguely like others we had seen around here ended up on our table. Shuyuan told how she had bought them from a little old farmer woman from the countryside who said the mangoes were from a very old tree she had on her property. The big surprise
The issue of China’s overcapacity has drawn greater global attention recently, with US Secretary of the Treasury Janet Yellen urging Beijing to address its excess production in key industries during her visit to China last week. Meanwhile in Brussels, European Commission President Ursula von der Leyen last week said that Europe must have a tough talk with China on its perceived overcapacity and unfair trade practices. The remarks by Yellen and Von der Leyen come as China’s economy is undergoing a painful transition. Beijing is trying to steer the world’s second-largest economy out of a COVID-19 slump, the property crisis and
Former president Ma Ying-jeou’s (馬英九) trip to China provides a pertinent reminder of why Taiwanese protested so vociferously against attempts to force through the cross-strait service trade agreement in 2014 and why, since Ma’s presidential election win in 2012, they have not voted in another Chinese Nationalist Party (KMT) candidate. While the nation narrowly avoided tragedy — the treaty would have put Taiwan on the path toward the demobilization of its democracy, which Courtney Donovan Smith wrote about in the Taipei Times in “With the Sunflower movement Taiwan dodged a bullet” — Ma’s political swansong in China, which included fawning dithyrambs