If Phil Gramm answered this question, he’d probably be more concerned about the 99% “whiners” than the 1% “winners”. Not so the crowd that turned out for the March 15th Bill Moyer’s Discussion Group meetup at Jorge’s restaurant. We met to discuss Bill Moyer’s interview with Jacob S. Hacker and Paul Pierson, authors of Winner-Take-All Politics: How Washington Made the Rich Richer–and Turned Its Back on the Middle Class (Simon and Schuster, 2010).
Our meetup attendees had their opinions at the ready and addressed a range of topics including credit default swaps, limits on corporate liability, and shrinking retirement savings. A common theme that wound its way through our discussion is the inability of the middle class to defend its own interest, while the 1% are able to use our “democratic” political system to pursue theirs.
Hacker and Pierson analyze how the 1% have been successful in accelerating their wealth accumulation while the incomes of the 99% have decreased over the last thirty years. Their analysis is complex and not easily summarized in a blog. What follows are the basic points of their analysis introduced in Chapter 2 and then greatly expanded upon through the rest of their book:
- American politics and public policy are responsible for the growing income inequality.
- Changes in public policy have been favorable to the rising incomes of the super-rich (as opposed to the merely rich).
- The failure to pass new laws that address the changing nature of our economy has increased inequality. Hacker and Pierson refer to the failure to update laws that no longer reflect the current reality as “drift”.
- Taxation and government benefits are not the only factors that affect income. Government has a strong influence on income distribution before “government taxes and benefits take effect” through “laws governing unions; the minimum wage; regulation of corporate governance; rules for financial markets… including economic ventures, and so on.” (Pg. 44, Hacker and Pierson, hardback edition, 2010).
Their analysis makes clear how gridlock, made possible through the filibuster, the Senate’s “rule of sixty” and the Republican’s unwillingness to engage in bipartisan initiatives, has greatly exacerbated income inequality. Hacker and Pierson have a whole lot more to say about how our members of congress enrich themselves by colluding with large economic interests and accepting lobbying positions.
So is winner take all politics really that bad? You tell me. How big do you want the middle class to be?
Join us for the next Bill Moyers Discussion Group meetup Thursday, April 19th at Jorge’s restaurant (2203 Hancock Drive, Austin, TX). Come at 6:15 p.m. for drinks and dinner. At 7:00 we’ll watch and then discuss the Bill Moyers interview with John Reed, former CEO of Citigroup, and former Senator Byron Dorgan.