By Josh Marshall
On the leftward side of America’s political spectrum and even creeping into some warrens of the right, wealth and income inequality is the issue of the day. That is hardly surprising since the bare numbers, compiled over decades, tell us how a tiny fraction of the population is leaving the great mass of Americans behind. Occupy Wall Street helped give the debate a vocabulary - the 1% vs the 99%. New Court rulings like Citizens United have expanded the prerogatives of extreme wealth. The scale of interest has even taken what was destined to be a thick tome on capitalism and inequality - Thomas Piketty’s Capital in the Twenty-First Century - read only by specialists and economists and transformed it into an international bestseller.
So with that interest, this consequence and the centrality of the issue for our time, we at TPM decided to commission a four part series on the topic - the first time we’ve ever done such a project. The four pieces come from different authors, each coming from a different angle, with a different sort of expertise. The aim of the series is to pose a simple question: How did we get here?
Half a century ago, the US political economy was profoundly different. Wealth and income inequality were at historically low levels. The US still had the immense advantage of being the factory for rebuilding the world after the devastation that scarred much of the globe during the Second World War. And unions were a pervasive feature of the industrial economy. So how did we get from there to here?
We’re not going to try to answer that question in any definitive way. Our aim is to provide some of the building blocks to to think critically about the question. One thing that I’ve always been interested in on this topic and on all issues of political economy is the interplay, one might say the feedback loop, between political and economic change.
For instance, it’s one of the well-worn parts of this story that after his election in 1980, Ronald Reagan dramatically reworked the tax code in favor of wealthier Americans, fired members of the PATCO air traffic controllers union in a high profile showdown with labor and decisively clawed back the regulatory state on a variety of fronts. All true. But how did Reagan get elected? And more importantly how was he able to get reelected? For that you have to go back into the 1970s to look at the birth of what we now recognize as the modern Republican party, with the critical development of political infrastructure by organized wealth and the increasing politicization of the Christian right. Old line business organizations that had been generally content to operate within the parameters of the New Deal state became increasingly ideological and focused on overturning it.
Relatedly, even in the heyday of the Great Society in the 1960s, the divergence we recognize today between the very affluent and the rest of Americans was already beginning for reasons we do not entirely understand. That divergence helped make organized wealth both more powerful and more conscious of itself as distinct from the rest of society. That growing power was plowed into political organizing. That led to political victories which in the 1970s and 1980s shifted public policy in ways that reinforced these same economic trends.
These are not novel observations. But teasing apart this often chicken and egg interplay between economic forces and political change is critical to understanding the unfolding story.
The first installment of our four part series kicks off next week with Rich Yeselson’s look at the politics of the left and the decline of organized labor over the last half century. The decline of labor played a key role in the declining economic clout of working class and middle class Americans. But it is only part of the story. I loved reading this piece, just a richness of detail and history that I wasn’t aware of. As Rich notes, a hostile political environment and globalization aren’t the only factors. Whole industries like mining, which were core to labor power, simply shrunk dramatically in terms of the number of people they employ in large part because of technology and mechanization.
Next John Judis looks at the complicated politics of inequality. Particularly, how those who are in many ways most affected by the flattened economic prospects of the middle class have become increasingly skeptical about government’s ability to shift the trend. This is a pessimistic, challenging look at the prospects for change. But it’s a critical one for anyone thinking seriously about the challenges to building political alliances for change.
Next, Jared Bernstein looks at the numbers. What we know from the reams of economic data generated over the last half century and what don’t we know. And as near as we can tell, how well do we know which factors are driving the accelerating run up in inequality.
Finally, Brad DeLong looks at the debate over Thomas Picketty’s book Capital in the 21st Century. Piketty argues, on the basis of reams of data, that we have the question basically wrong. What is happening now is simply how capitalism works, says Piketty. It only seems out of the ordinary because we lived through or came just after a period of profound historical anomaly in which a series of factors - largely the destruction of World War II - changed the historic pattern. DeLong looks at Piketty’s thesis through the prism of economic and politics and surveys the reactions his work has generated over the last year.
Our series kicks off next week. We hope you enjoy it and we look forward to the feedback and discussions.