Should we be mad at the 1%?

http://finance.fortune.cnn.com/2012/04/24/pay-gap-rich-poor/

 I think her argument is part straw man, part wrong, and part ok.

The straw man part is that the anger of the 99% is directed at the 1%.  I don't think this is generally the case.  The anger is directed at a self-reproducing class system that is supported by political decisions that have lowered tax rates and deregulated banking.  Americans still emulate rich people and want the lifestyle sold as the American Dream, which is increasingly becoming off-limits to the majority of Americans because our economic policies have been directed at increasing the gains at the top while eroding the social safety net at the middle and bottom.  

Furthermore, the values she attributes to the 1% aren't exclusive to the 1%.  Part of the reason the anger is bubbling up now is that you can do everything right--go to college, get a job, get married, and because of complex economic problems coupled with a political trend that has eroded the middle class, all that can be swept out from under you in a heartbeat.  There's much less security now unless you are a member of the 1%.  The implication that the 1% deserve to enjoy these benefits is accompanied by the implication that the rest of us don't, whether she intends it or not.  

The wrong part is the idea that getting everyone a bachelor's degree is going to fix this problem.  First of all, the skill set needed in the economy now are associate's degrees, for jobs whose wages are not going to do much about inequality.  Second of all, the value of a bachelor's is diluted as more people attain them--this is a pretty basic economic concept of generalized equilibrium.  Third of all, the inequality itself is a contributing factor to why it's harder and harder for people to attain BAs.  

The other wrong part is ignoring the fact that you're going to need redistributive tax policies in order to fund the policies that will increase education.

The true part goes back to the straw man part. We shouldn't villify individual 1-percenters; it is the system we are all a part of that produces such unequal benefits for 1-percenters that we should be railing at, and channeling our anger politically. 

Heading back out into the world

I was inspired today to return to this blog, maybe because my subconscious is sensing I don't have much longer to express my policy and political ideas over lunch with my classmates, and will need a different outlet to process the things I have learned at HKS over the last two years.

I received an email about this talk :http://www.cato.org/event.php?eventid=8940&utm_source=Cato+Institute+Emails&utm_campaign=1bc6c1b8a3-CBF_American_Nightmare&utm_medium=email&mc_cid=1bc6c1b8a3&mc_eid=38bd0df18e

...with the following commentary: Typical Cato crap…


Typically a sentiment I'd agree with.  But at second glance (without having read the book), one of the central arguments of this book appears to be a relatively mainstream, neither-liberal-nor-conservative policy prescription (other arguments contained therein, probably not so).  


That is, if the author is in fact arguing that local land use policies constrain the housing supply and lead to the inflation of housing prices, I tend to agree.  Not that this would have prevented the bubble; some of the states that were hardest hit (FL, NV, TX) have the least restrictive land use policies, and that may have made a negative contribution to the overexpansion of homeownership. The land use policies weren't the problem there, the expansion of sub-prime credit was, but the expansion of the housing stock complemented the expansion of bad credit.  

What Iactually find interesting and depressing about this Cato talk, though, is not its policy content per se, but what it represents about the quality of political discourse in this country, where a relatively mainstream argument (see Ed Glaeser, a Harvard prof who advocates for expanding the housing supply) becomes polemicized with outrageous language pandering to a certain set of values and becomes essentially code for a whole other set of values, in this case conservative anti-statism.  Dems and Progs need to take back these kinds of policies and figure out how to talk about them in language that resonates as well as the language that conservatives have found to rile up the Republican base.  Reframe the debate, so housing policy isn't about heavy-handed government distorting the market, but rather about good governance laying out rules that lead to fairness and prosperity.  

This Poem Moved Me to Tears...

...And it was a good feeling. Screw happiness. (Reposted)

http://jezebel.com/5535538/happiness-really-isnt-thathappy

This Happens in America

If you don't think that women are at risk of hard-nose tactics, consider this: Just two years ago Juana Villegas was arrested for a routine traffic violation in Nashville after leaving a clinic for a pre-natal visit and detained when she was unable to produce a license. Despite the fact that driving without a license is a misdemeanor in Tennessee that generally leads to a citation, Ms. Villegas was taken into custody due to suspicions about her immigration status.

Ms. Villegas was jailed for six days, during which time she gave birth to a little boy while shackled to a bed under the watchful eye of the sheriff's officer. Barred from speaking to her husband, her baby was taken from her upon birth, leading to a number of health repercussions for both mother and baby. Local police stood by their actions, calling Nashville "a friendly and open city to our new legal residents." In a chilling display of Nashville's "friendliness," local police also confiscated Villegas' breast pump.

Health Care

http://www.thedailybeast.com/cheat-sheet/item/10-instant-effects-of-reform/what-now/

It addresses a bit of the problem with the employer-based health care model as a whole by encouraging small businesses to offer insurance while mitigating the cost to those businesses by offering a tax deduction, and mitigates the effect of the profit motive of large insurance companies on national health by taxing those companies whose administrative costs (read: executive compensation packages) exceed a certain percentage of their operating budget.

This is why health care goes hand in hand with financial reform and student loan reform. To avoid that latter provision about administrative costs having the unintended consequence of premiums actually rising as that tax gets passed onto consumers, executive pay needs to come down across the board so that lower compensation packages at insurance companies won't lead to a brain drain at the companies to whom we are entrusting the health of our nation. (I.e. That tax needs to be borne by the executives, not the consumers, but compensation should be competitive even if it includes a public service component.)

Student loan reform comes in as we need to mobilize our economy to pay for these reforms, given the good chance that despite OMB projections, health care reform may cause a net increase in the deficit (and almost certainly will over the short term). More students in college with less debt takes the long view of our economic health as a nation. That's assuming that the gov't can in fact make student loans better without the middle man, and I don't know what the projections are for the short term consequences to the banking sector.

Nevertheless, the economic picture for our country is not pretty over the short term no matter which way you paint it (and the banking sector has been resilient despite the creative destruction of some of its members), and this looks better than the status quo to me.

A Little Note Since It's Been A While

http://jezebel.com/5461630/eating-disorders-somehow-still-occuring-in-fashion-industry?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+jezebel%2Ffull+%28Jezebel%29&utm_content=Google+Reader

This article rang a little hollow to me since I read it after looking at photos of Gawker Media's NSFW party, filled with glossy thin white flat-ironed women with whom I can't relate any better than if they were supermodels. That was more damaging to my self image for the day than looking at LOVE's naked cover girls. A place like Gawker Media, to which I would actually look for role models, is apparently just as inaccessible to me as Wilhelmina.

Not a Lost Cause

http://jezebel.com/5406933/matchpoint?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+jezebel%2Ffull+(Jezebel)&utm_content=Google+Reader

This is probably the first news item I've seen on Sudan that isn't about genocide. As we question our involvement or lack thereof in Darfur, i think it's an important reminder of what is at stake.