New Democratic Platform Focuses on Inequality, Not Economic Growth. Too Bad.

 

twenty20_98a96c20-732c-4559-bb4e-d8cda93d8476_money_wealth_income_inequality-e1468426902913Yes, I know the caveats about taking too seriously the GOP and Democratic party platforms. The respective presidential nominees aren’t bound to support the platforms, much less try and turn those positions into law if elected. But they do probably contain some useful information about what the activist base is thinking in both parties. And big changes in the platforms can signal big changes in thinking and which intra-party groups have momentum.

In the WSJ, William Galston notes how the draft of the new Democratic platform shows the party’s leftward lurch:

The party that Hillary Clinton will lead into battle this fall is not Bill Clinton’s Democratic Party. In important respects it is not even Barack Obama’s Democratic Party. It is a party animated by the frustrations of the Obama years and reshaped by waves of economic and social activism.

Not surprisingly, the document endorses a range of Hillary Clinton’s campaign proposals, including a massive infrastructure-investment program, new incentives for small business, expanded profit-sharing to increase workers’ earnings, a tax on high-frequency financial transactions, paid family and medical leave, an enhanced earned-income tax credit for young workers without children, access to computer-science education for all K-12 students, and measures to make college education more affordable.

Neither is it surprising that the draft incorporates some of Bernie Sanders’s key proposals—most notably, a $15 per hour minimum wage—and that it doesn’t take sides on issues that divided the party, such as the Trans-Pacific Partnership trade agreement and a broad tax on financial transactions, where neither side would give way. In other respects, however, the draft is truly remarkable—for example, its near-silence on economic growth. The uninformed reader would not learn that the pace of recovery from the Great Recession has been anemic by postwar standards, or that productivity gains have slowed to a crawl over the past five years, or that firms have been reluctant to invest in new productive capacity. Rather, the platform draft’s core narrative is inequality, the injustice that inequality entails, and the need to rectify it through redistribution.

He’s right, especially about the bit I boldfaced. And to the extent the platform mentions economic growth, the economics of the document are “middle out” — a theory that demand and the expectation of demand drive long-term economic growth. Other than more government R&D spending, it hasn’t much to stay about entrepreneur-focused growth and innovation policy, or how to remove barriers to high-impact entrepreneurship. All of which makes sense if you frown at the billionaires created by successful startups, many of which result from tech sector “unicorns.” (Perhaps the next platform will call for breaking up some of American’s tech giants.)

Indeed, the very first section of the platform is titled: “Raise Incomes and Restore Economic Security for the Middle Class.” And the first item in that first section: a call for a $15 minimum wage (despite plenty of skepticism from center-left economists). The next section: “Create Good-Paying Jobs.” And the first item there: infrastructure spending.

Popular policies, I’m sure. But again, boosting productivity and innovation seem secondary even though they are key to rising living standards. At its core, this is a platform about broad-based wealth redistribution, not broad-based wealth creation. As the White House CEA recently explained, “The slowdown in productivity growth has had profound consequences, contributing to slower growth in real wages and increasing our long-run fiscal challenges.”

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  1. Big Green Inactive
    Big Green
    @BigGreen

    James – Something I don’t fully understand in their list of promised giveaways…how exactly would the expanded profit sharing thing work?  Since there are virtually no state owned enterprises here (at least for a little while longer…), how do they plan on this “expansion”?  Through the tax code by allowing companies to deduct profit sharing payments from their federal taxes or something similar?

    • #1
  2. The Reticulator Member
    The Reticulator
    @TheReticulator

    If I were a Democrat, I wouldn’t give up on the income inequality issue.  Democrats cause a lot of it with their spending and regulatory policies, but they don’t have to take the blame for its bad effects because Republicans would rather try to convince everyone that income inequality isn’t such a bad thing.

    • #2
  3. Big Green Inactive
    Big Green
    @BigGreen

    The Reticulator:If I were a Democrat, I wouldn’t give up on the income inequality issue. Democrats cause a lot of it with their spending and regulatory policies, but they don’t have to take the blame for its bad effects because Republicans would rather try to convince everyone that income inequality isn’t such a bad thing.

    That’s because it isn’t such a bad thing and is unavoidable in a dynamic, wealth generating economy.  If folks think things are really bad now, wait until all incomes are “equal”.

    • #3
  4. The Reticulator Member
    The Reticulator
    @TheReticulator

    Big Green:

    The Reticulator:If I were a Democrat, I wouldn’t give up on the income inequality issue. Democrats cause a lot of it with their spending and regulatory policies, but they don’t have to take the blame for its bad effects because Republicans would rather try to convince everyone that income inequality isn’t such a bad thing.

    That’s because it isn’t such a bad thing and is unavoidable in a dynamic, wealth generating economy. If folks think things are really bad now, wait until all incomes are “equal”.

    See what I mean? Win-win for Democrats as long as Republicans keep doing this.

    • #4
  5. GreenCarder Inactive
    GreenCarder
    @GreenCarder

    You have to hand it to the Democrats – they never let a total lack of success deter them from doubling down on the same policies.

    Their focus since at least the start of the Obama Administration has been on promoting equality rather than growth – with the result that they’ve got less of both.

    • #5
  6. The Reticulator Member
    The Reticulator
    @TheReticulator

    GreenCarder:You have to hand it to the Democrats – they never let a total lack of success deter them from doubling down on the same policies.

    Their focus since at least the start of the Obama Administration has been on promoting equality rather than growth – with the result that they’ve got less of both.

    I don’t know why you think that’s lack of success, unless you think they really care about equality. (They don’t.)

    • #6
  7. Big Green Inactive
    Big Green
    @BigGreen

    The Reticulator:

    Big Green:

    The Reticulator:If I were a Democrat, I wouldn’t give up on the income inequality issue. Democrats cause a lot of it with their spending and regulatory policies, but they don’t have to take the blame for its bad effects because Republicans would rather try to convince everyone that income inequality isn’t such a bad thing.

    That’s because it isn’t such a bad thing and is unavoidable in a dynamic, wealth generating economy. If folks think things are really bad now, wait until all incomes are “equal”.

    See what I mean? Win-win for Democrats as long as Republicans keep doing this.

    It’s a win-win for the Democrats as long as Republicans speak the truth?  Interesting take.

    Are you suggesting that the goal of the Republican party should be for all incomes to be equal?  Or, are you suggesting the the Republican party should not be for all incomes to be equal yet to lie and make that principle a part of the party platform?

    • #7
  8. The Reticulator Member
    The Reticulator
    @TheReticulator

    Big Green:

    The Reticulator:

    Big Green:

    The Reticulator:If I were a Democrat, I wouldn’t give up on the income inequality issue. Democrats cause a lot of it with their spending and regulatory policies, but they don’t have to take the blame for its bad effects because Republicans would rather try to convince everyone that income inequality isn’t such a bad thing.

    That’s because it isn’t such a bad thing and is unavoidable in a dynamic, wealth generating economy. If folks think things are really bad now, wait until all incomes are “equal”.

    See what I mean? Win-win for Democrats as long as Republicans keep doing this.

    It’s a win-win for the Democrats as long as Republicans speak the truth? Interesting take.

    Are you suggesting that the goal of the Republican party should be for all incomes to be equal? Or, are you suggesting the the Republican party should not be for all incomes to be equal yet to lie and make that principle a part of the party platform?

    I’d be glad to try to explain better, but it’s not going to do any good if you don’t know what I already wrote. (Which bears no resemblance to your questions.)

    There seems to be something about this issue that causes conservative minds to go blotto.  I wish I knew what to do about it but for now I’m too flumoxed by your jumping to these conclusions.

    • #8
  9. I Walton Member
    I Walton
    @IWalton

    Equality is the perfect progressive position as well as their only notion.  It has no meaning, can’t be created, can never exist so it will always be there as a bludgeon to use for whatever leverage the left wants in all circumstances.

    • #9
  10. The Reticulator Member
    The Reticulator
    @TheReticulator

    I Walton:Equality is the perfect progressive position as well as their only notion. It has no meaning, can’t be created, can never exist so it will always be there as a bludgeon to use for whatever leverage the left wants in all circumstances.

    As we saw with Pol Pot.  The drive for equality leads to the Killing Fields.

    But some people are so binary: We can’t have equality and wouldn’t like it if we could; therefore, the most extreme inequality is best. Weird.

    • #10
  11. Big Green Inactive
    Big Green
    @BigGreen

    The Reticulator:

    Big Green:

    The Reticulator:

    Big Green:

    See what I mean? Win-win for Democrats as long as Republicans keep doing this.

    It’s a win-win for the Democrats as long as Republicans speak the truth? Interesting take.

    Are you suggesting that the goal of the Republican party should be for all incomes to be equal? Or, are you suggesting the the Republican party should not be for all incomes to be equal yet to lie and make that principle a part of the party platform?

    I’d be glad to try to explain better, but it’s not going to do any good if you don’t know what I already wrote. (Which bears no resemblance to your questions.)

    There seems to be something about this issue that causes conservative minds to go blotto. I wish I knew what to do about it but for now I’m too flumoxed by your jumping to these conclusions.

    Give it a shot.  Plain language is usually easier to understand than code words.  Also, I didn’t jump to conclusions, I asked you some questions in an attempt to gain a better understanding of exactly what you are saying.

    • #11
  12. The Reticulator Member
    The Reticulator
    @TheReticulator

    Big Green: Give it a shot. Plain language is usually easier to understand than code words. Also, I didn’t jump to conclusions, I asked you some questions in an attempt to gain a better understanding of exactly what you are saying.

    The answer is no to both questions.  Now please ask me when I stopped beating my wife.

    • #12
  13. Big Green Inactive
    Big Green
    @BigGreen

    The Reticulator:

    Big Green: Give it a shot. Plain language is usually easier to understand than code words. Also, I didn’t jump to conclusions, I asked you some questions in an attempt to gain a better understanding of exactly what you are saying.

    The answer is no to both questions. Now please ask me when I stopped beating my wife.

    The questions were entirely reasonable in an attempt to bound the spectrum of what exactly you were suggesting in your original post.  I guess code is the preferred method though.

    • #13
  14. The Reticulator Member
    The Reticulator
    @TheReticulator

    Big Green:

    The Reticulator:

    Big Green: Give it a shot. Plain language is usually easier to understand than code words. Also, I didn’t jump to conclusions, I asked you some questions in an attempt to gain a better understanding of exactly what you are saying.

    The answer is no to both questions. Now please ask me when I stopped beating my wife.

    The questions were entirely reasonable in an attempt to bound the spectrum of what exactly you were suggesting in your original post. I guess code is the preferred method though.

    The questions were unreasonable, given that I gave no hint of going to the conclusions you asked about.

    • #14
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