osewalrus (osewalrus) wrote,
osewalrus
osewalrus

NYT and Republicans on the Economy

About a month ago, I wrote this piece about the differences between the Democratic vision and the Republican vision of how the economy should work. Today's NYT has this article I find relevant.

Briefly, I argued that the Republicans believe in an economy where every individual has unlimited opportunity under the law to maximize his or her net worth. The law should not impose burdens on individuals against their will to help other individuals. Thus we should not (in theory at least) tax individuals to fund social programs. By requiring individuals to take responsibility for their wealth maximization, it is argued, we unleash the energy and creativity of the work force and enahnce economic productivity overall. While acceptable to use the law to break down certain kinds of barriers (such as legal segregation), it is unacceptable to use the law to "level the playing field" to give those traditionally disadvanatged a better chance. Such puting of the state thumb on the economic scale is both unfair to those not similarly advanatged and inevitably corrupting of the far more efficient mechanisms of the private sector.

By contrast, since the New Deal, Democrats have been at least ideologically committed to an economic vision characterized by maximizing overall social welfare, even at the expense of individual wealth maximization. Thus, it is appropriate to tax the wealthy at a higher rate and use the money to fund social programs designed to alleviate poverty and enhance economic productivity at the lower end of the income scale. The argument is that this "rising tide" will lift all boats (so that those who pay more are ultimately repaid) and has positive economic and social impacts on our society.

In the last 30 years, we have deregulated and pursued an economic policy based on the Republican theory of personal wealth maximazation (Clinton's biggest efforts to move to a more traditional New Deal/Great Society approach, his energy tax and universal health care proposal, was rejected by the American people in 1994 and a Republican Congress has pursued the Republican economic philosophy ever since). This is long enough for Americans to discover the risk associated with the Republican philosophy -- you may not be among the folks who "make it." And if that happens, because we dismantled the New Deal/Great Society safety nets funded by the top to provide a floor for the bottom, you can -- through no fault of your own -- slide a long, long way down.

Today's NYT has this article about how despite positive economic news for the last few months, most folks remain unhappy with Republican handling of the economy -- even while most Americans think the economy is "strong" or "very strong" at the moment.

For the most part, the article attributes this to the dominance of certain national issues, like the Iraq War. But toward the end of the article, it finally comes around to my way of thinking.

"Perhaps the biggest challenge Republicans face to take credit for an improving economy is that for many voters, their economic prospects do not feel as great as overall statistics might imply. Rather than celebrate the stock market’s gains and the overall growth of the economy, many voters are worried about the wages of ordinary workers, which have just started to improve after several years of falling short or barely keeping up with inflation."

Indeed, I will go a step further. There are an awful lot of people for whom the news "the economy is working" is exactly the wrong message if you want to be elected. Because if this is how the system is supposed to work, and this is as good as it is going to get, then the system is not working very well for these people. Even the ones who do well know too many people like themselves -- not just the mythical welfare queens and lazy featherbedders who are the only ones who are supposed to suffer -- who are falling further and further behind.

In 2004, a lot of these people still voted Republican, because they believed that the economy ws still recovering. Now they are discovering that the economy has recovered. This is how the system works. And unless they get the hang of this "individual wealth maximazation" pretty durn quick, they are going to keep living as they are living: no savings, higher health care costs, and mounting debt.

How will these people vote in 2006? Especially with the economy doing so well?

We'll find out Novemeber 7.
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