The national Democratic Party has staked its retention of a Senate majority on a few carefully chosen campaign themes: denouncing Republican oligarchs flooding the election with political ads; deploring the War On Women; and, most emphatically, attacking what they call “income inequality.”
The evidence shows that policies favored more by the left are the root cause of this so-called “income inequality.” This theme, as are the others, is false and vulnerable. Is their strategy working? One wonders why the GOP is not calling it out more forcefully.
The situation rather calls to mind the Harry Reid-like Megamind’s confrontation with the GOP-themed’s hapless Tighten:
Giant Megamind head: You dare challenge Megamind?!
Tighten: This town isn’t big enough for two supervillains!
Giant Megamind head: Oh, you’re a villain, alright! Just not a SUPER one!
Tighten: Oh, yeah? What’s the difference?
Megamind: PRESENTATION!
Formidable! What’s not to love about dueling (super)villains … which our politics too often resemble?
The Democratic themes obviously are calculated. They are based on polling data showing sectors of the electorate to be persuadable by these narratives. Reality need not intrude.
Republican Oligarchs? Really? Commentator Phil Kerpen has noted, in a column in The Federalist captioned “Corruption” and entitled, Malevolent Billionaire Announces Voter Suppression Scheme: A billionaire Democrat donor announces a scheme for suppressing Republican votes. Does anyone care?
San Francisco offshore hedge fund billionaire Tom Steyer is the biggest donor in American politics by a country mile. As of the most recent round of disclosures, he had contributed $42,725,000 to elect Democrats, which is more than the top 31 Republican donors—combined. So of course when the Arlington-based liberal blog Politico obtained a Steyer strategy memo last month, they … completely ignored the shocking voter suppression strategy advocated by Steyer’s top political hand, Chris Lehane.
War on Women? The Democrats have attempted to reframe, as a “war on women,” some (not enough) Republican championship of First Amendment-protected conscientious objection to government-mandated provision of birth control and abortion coverage. The emergence of several conservative GOP Senate candidates favoring of liberalized access to birth control undermines this Democratic narrative. The “war on women” is, of course, counterfactual election hype. According to a recent AP poll, women aren’t buying it.
The Democrats most emphatically are presenting a shrill “income inequality” campaign theme. Democratic rock-star progressive Senator Elizabeth Warren (D-Mass) put it, in campaigning for the re-election of her progressive Democratic colleague Al Franken (D-Mn) “The game is rigged, and the Republicans rigged it.” Not to be outdone, Hillary Clinton recently declaimed “Don’t let anybody tell you it’s corporations and businesses create jobs….” Forgive my incredulity, which seems shared by a lot of us voters.
The proposed Democratic remedy? Mandatory minimum wages and “gender equality.”
Newspeak for government, rather than the market, determining wages.
The left elegantly is engaging in an attempt at reframing of the ambient degradation of economic (and social) mobility. There is plenty of blame to go around for economic sogginess. That said, the degradation mostly is an outcome of favored Democratic policies.
So-called “income inequality” is a tale to be pinned on the Donkey, not Pachyderm. Historical analysis strongly suggests that this, in its current degenerate form, came out of the lamp rubbed by Lyndon Johnson’s closing of the London gold pool and the Nixon Shock’s application of progressive-advocated policies such as wage-price controls and a tariff. These proved, of course, briefly popular and soon truly catastrophic.
The closed gold window is the sole lingering aftershock of the Nixon Shock. Whether or not money supply is calculable money demand inherently is not. Thus technocratic management of monetary policy by the Federal Reserve has proven debilitating to the economy. “Income inequality” correlates with the repudiation (by both Johnson and Nixon) of Bretton Woods and its replacement by technocratic discretionary Fed monetary policy.
The problem of degraded economic mobility readily can be fixed … but not with minimum-wage BandAid® “solutions.” The data are compelling that the additional productivity under Bretton Woods (and its predecessor classical gold standard) led to consistent, hefty, rising median family standards of living. The data also are compelling that our nearsighted and stubborn central bankers’ policies correlate closely with degradation of economic mobility.
Coincidence? I think not. And that makes the Democratic strategy vulnerable.
Here’s one vulnerability. Most Americans aspire to affluence (and yearn for their children to do even better). The data show that the American people, living in a culture originally forged by the Pilgrims, in no way begrudge the wealthy their wealth.
Here’s another vulnerability. We’re restive at our inability to get ahead in the face of the headwinds caused by an evanescent paper dollar. If the Republicans were even semi-conscious they would be promulgating a strong “good money” counter-narrative, attacking the Democrats for conniving at the misery of workers and of median families.
Which leads to a third. Currently, the Democratic Party is the Handmaiden of the Fed. (Unless, of course, the Fed is the Handmaiden of the Democrats.) Let’s begin with taking a hard look at the effects of monetary policy on us regular Jacks and Jills.
It would be powerful to look at the history of American monetary policy, from its long precious-metal era (which Forbes.com commentator Nathan Lewis has, in his typically understated way, concluded correlates with Stupendous Growth), to the Bretton Woods gold-exchange standard, to the epoch of stagflation, to the equitable prosperity of the Fed’s “Great Moderation” under Reagan and Clinton, to the “Little Dark Age” of economic stagnation besetting us now for over a decade, torpedoing both the Bush and Obama administration.
As for the Democrats favorite metanarrative itself… Forbes.com’s John Tamny has rhapsodized on the virtues of income inequality: The Life Enhancing, Unrelenting Brilliance of Income Inequality. Tamny:
Lost on the economic illiterates that populate both sides of the commentariat is the simple, life enhancing truth that when the wealth gap is increasing, that’s a certain signal that the lifestyle gap is shrinking — rapidly. Though the politically correct on both sides are loath to admit it, income inequality is beautiful.
Tamny likes to épater le bourgeois. He is a master at it.
That said, it would be a perverse misreading of his point to interpret his extolling of inequality as special pleading for the rich, or, indeed, as less than a profound utilitarian, if not moral, advocacy for policies that benefit workers and consumers. Tamny:
Thinking about wealth creation in the U.S. and the ever-growing wealth gap, Apple Inc. co-founder Steve Jobs died worth billions; his staggering wealth a signal that he’d greatly reduced the lifestyle gap. Music that used to be expensive, and that required the buyer to purchase much that was unwanted, now costs .99 cents. Wireless phones that were once the obscure property of the superrich are now positively pedestrian.
Meanwhile, back in left field, applying a wealth tax, as progressives such as Sen. Sanders advocate, merely would move power over money into progressive hands. There is little actual evidence that progressives ever have been, or ever would be, better stewards than are their designated nemesis, the Titans of Industry. As I’ve previously stated, “progressives keep promising Denmark, a true socialist workers paradise and the happiest country in the world, and delivering Detroit: now entering the Ninth Circle of Hell.”
Many progressives, certainly including Sen. Sanders, have a sweet earnestness. Their belief that they would solve our problems if only they took all that money from the filthy rich (what fun for them!) verges on magical thinking. One hesitates to criticize — it seems hardhearted — yet to remedy the slow-rolling catastrophe progressives have visited upon us let us ponder, again from Megamind, the wise counsel of Tighten to Roxie: “You’re living a fantasy. There is no Easter Bunny. There is no Tooth Fairy. There is no Queen of England. This is the real world, and you need to wake up!”
A small irony bears noting. The nature of the capitalist system turns folks like Bill Gates, and other fabulously successful people, into de facto civil servants. The seriously rich, however dissipated (which most are not), cannot begin to use up their riches for consumption. They must perforce direct most of their wealth into the development of productive enterprises.
Productivity is the fundamental predicate for rising wages and improved buying power. Good investment decisions primarily benefit the average Jill through better jobs and better products. Consistently bad investors go broke. (Except, of course, the government, whose chronic bad judgment merely causes us taxpayers to go broke.)
The role of our capitalists is not exactly a wretched indentured servitude for the 1%. Neither, however, is it endless lolling on yachts drinking gin and tonics. And let us now praise Bill and Melinda’s philanthropy, some of which has done enormous good, saving perhaps millions of souls in Africa from infectious diseases.
The electorate only has one question in its mind: “What’s in it for me?” This is a healthy question. It is rooted in voters’ values as well as interests. It is sensible, not cynical. We wish a government that will adopt policies that allow us to flourish. What might this look like?
There are a few flickers of Brain Life in the GOP. Sen. Ted Cruz, recently, prominently called, as one of his “ten critical priorities for the 2015 Congress, to
audit the Federal Reserve. … Enough is enough, the Federal Reserve needs to open its books — Americans deserve a sound and stable dollar.
The GOP would benefit from much more of this kind of smarts.
There is overwhelming evidence that bad monetary policy — from a Magoo Fed and Deranged Dollar — is robbing the economy of the investment that drives up productivity and wages. The GOP had, and mostly squandered yet soon again will have, an opportunity to lay out smart plans put the country back on track to economic mobility. Let’s hope they don’t squander it again.
Let the GOP reframe the narrative into one of restoring vibrant economic mobility, by proven methods such as good monetary policy, rather than playing defense on “income inequality” — a deformed concept easily turned against the progressives.
How? Begin here. Enact the Brady-Cornyn Centennial Monetary Commission. Enact the Federal Reserve Transparency Act (already passed by huge bipartisan majority in the House). Take a strong stand for Fed independence from political tampering.
Hello GOP (and serious Democrats)? Time to champion the little guy by opening up the can of equitable prosperity that is good money.
Harry Reid’s strategy to keep the Senate rings false. Good money is good policy and good politics
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