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Old 02-18-2013, 04:56 PM  
Direckshun Direckshun is online now
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The problem with conservativism in 2013.

The key problem that I believe conservativism has to face in 2013 and the near future is that it doesn't have an answer to what has become the most critical problem for the 21st century economy: inequality.

There has been a historical tendency over the past 15 years and three Presidents to concentrate more and more wealth with the wealthy, and less and less wealth with everybody else. Inequality is at all time highs on that front, and it gives the middle and lower classes less spending money, slogs down the economy, and ultimately splits the economic pie even greater into the hands of the few.

Liberalism has a whole host of solutions, bordering from the more free market tendencies of the Democratic Party and the mainstream liberal movement, to the more socialist suggestions frequently made by the party's left wing. Some of them can be argued as legitimately good ideas (raising the minimum wage, capping the multi-billion dollar tax breaks for huge corporations, any number of investments in college education), some of them are obviously more on the fringe.

Conservativism's answer seems to be singular and ineffective: get "government out of the way," undo the massive structure of government regulation, and the economy will grow. And like a rising tide that lifts all boats (think "trickle down" economics), as the economy grows, so too will the fortunes of the lower and middle classes. Honestly, if conservativism has more of a message than this right now with regards to inequality, I've missed it.

The problem with this message, and conservativism in general right now, is that it seems outdated for 2013. As the economy has grown at times throughout the past fifteen years, the middle class and working poor have seen less and a less of a return on that progress, and the upper class has soared. In other words, the absolute core conservative response to the biggest issue affecting working Americans in 2013 is no longer applicable. It had some bearing, perhaps, in previous decades, but we now reside in an era where this dynamic no longer holds water.

Economists are reportedly attempting to figure out why that is the case. A decrease in education quality seems, to me, to be the most convincing cause, although obviously this is something that deserves a holistic analysis.

But either way, I don't really see convincing analysis that growth is enough anymore. It seems that a reduction in inequality seems now to be just as important.

http://www.washingtonpost.com/busine...06b_print.html

Growth isn’t enough to help the middle class
By Jim Tankersley
Published: February 13

Two kinds of middle-class Americans are struggling today — people who can’t find any work or enough work, and full-timers who can’t seem to get ahead.

Democrats and Republicans prescribe economic growth to help both groups. There was a time that would have been enough. But not today.

In the past three recoveries from recession, U.S. growth has not produced anywhere close to the job and income gains that previous generations of workers enjoyed. The wealthy have continued to do well. But a percentage point of increased growth today simply delivers fewer jobs across the economy and less money in the pockets of middle-class families than an identical point of growth produced in the 40 years after World War II.

That has been painfully apparent in the current recovery. Even as the Obama administration touts the return of economic growth, millions of Americans are not seeing an accompanying revival of better, higher-paying jobs.

The consequences of this breakdown are only now dawning on many economists and have not gained widespread attention among policymakers in Washington. Many lawmakers have yet to even acknowledge the problem. But repairing this link is arguably the most critical policy challenge for anyone who wants to lift the middle class.

Economists are not clear how the economy got to the point where growth drives far less job creation and broadly shared prosperity than it used to. Some theorize that a major factor was globalization, which enabled companies to lay off highly paid workers in the United States during recessions and replace them with lower-paid ones overseas during recoveries.

There is even less agreement on policy prescriptions. Some liberal economists argue that the government should take more-aggressive steps to redistribute wealth. Many economists believe more education will improve the skills of American workers, helping them obtain higher-paying jobs. And still others say the government should seek to reduce the cost of businesses to create new jobs.

The problem is relatively new. From 1948 through 1982, recessions and recoveries followed a tight pattern. Growth plunged in the downturn, then spiked quickly, often thanks to aggressive interest rate cuts by the Federal Reserve. When growth returned, so did job creation, and workers generally shared in the spoils of new economic output.

You can see those patterns in comparisons of job creation and growth rates across post-World War II recoveries. Starting in 1949 and continuing for more than 30 years, once the economy started to grow after a recession, major job creation usually followed within about a year.

At the height of those recoveries, every percentage point of economic growth typically spurred about six-tenths of a percentage point of job growth, when compared with the start of the recovery. You could call that number the “job intensity” of growth.

The pattern began to break down in the 1992 recovery, which began under President George H.W. Bush. It took about three years — instead of one — for job creation to ramp up, even when the economy was growing. Even then, the “job intensity” of that recovery barely topped 0.4 percent, or about two-thirds the normal rate.

The next two recoveries were even worse. Three and a half years into the recovery that began in 2001 under President George W. Bush, job intensity was stuck at less than 0.2 percent. The recovery under President Obama is now up to an intensity of 0.3 percent, or about half the historical average.

Middle-class income growth looks even worse for those recoveries. From 1992 to 1994, and again from 2002 to 2004, real median household incomes fell — even though the economy grew more than 6 percent, after adjustments for inflation, in both cases. From 2009 to 2011 the economy grew more than 4 percent, but real median incomes grew by 0.5 percent.

In contrast, from 1982 to 1984, the economy grew by nearly 11 percent and real median incomes grew by 5 percent.

Today, nearly four years after the Great Recession, 12 million Americans are actively looking for work but can’t find a job; 11 million others are stuck working part time when they would like to be full time, or they would like to work but are too discouraged to job-hunt. Meanwhile, workers’ median wages were lower at the end of 2012, after adjustments for inflation, than they were at the end of 2003. Real household income was lower in 2011 than it was in 1989.

Obama alluded to the breakdown between growth and middle-class wages and jobs in his State of the Union address. “Every day,” he said, “we should ask ourselves three questions as a nation: How do we attract more jobs to our shores? How do we equip our people with the skills needed to do those jobs? And how do we make sure that hard work leads to a decent living?”

But outside of some targeted help for manufacturing jobs and some new investments in skills training, the proposals Obama offered focused comparatively little on repairing the relationship between growth and jobs, or growth and income. Obama’s boldest plans included increasing the minimum wage and guaranteeing every child a preschool education. Both aim largely at boosting poorer Americans and helping their children gain a better shot at landing the higher-paying jobs.

The Republican response to Obama’s speech did not appear to nod to the new reality at all. Sen. Marco Rubio (Fla.) said that “economic growth is the best way to help the middle class” and offered few job-creation proposals that appeared materially different from what Republican politicians have pushed since the 1980s.

Economists are still trying to sort out what broke the historical links between growth and jobs/incomes.

Economists are still trying to sort out what broke the historical links between growth and jobs/incomes.

Federal Reserve Bank of New York economists Erica Groshen and Simon Potter concluded in a 2003 paper that the recoveries from the 1990 and 2001 recessions were largely “jobless” because employers had fundamentally changed how they responded to recessions. In the past, firms laid off workers during downturns but called them back when the economy picked up again. Now, they are using recessions as a trigger to lay off less-productive workers, never to hire them back.

Economists at the liberal Economic Policy Institute trace the problem to a series of policy choices that, they say, have eroded workers’ ability to secure rising incomes. Those choices include industry deregulation and the opening of global markets on unfavorable terms for U.S. workers.

In the latest edition of their book “The State of Working America,” EPI economists argue that an “increasingly well-paid financial sector and policies regarding executive compensation fueled wage growth at the top and the rise of the top 1 percent’s incomes” at the expense of average workers.

Robert Shapiro, an economist who advised Bill Clinton on the campaign trail and in the White House, traces the change to increased global competition.

“It makes it hard for firms to pass along their cost increases — for health care, energy and so on — in higher prices,” he said. “So instead they cut other costs, starting with jobs and wages.”

Shapiro said the best way to restart job creation is to help businesses cut the costs of hiring, including by reducing the employer side of the payroll tax and pushing more aggressive efforts to hold down health-care cost increases.

Obama seems to have embraced an approach pushed by Harvard University economists Claudia Goldin and Lawrence Katz: helping more Americans graduate from college and go on to high-skilled, higher-paying jobs. It’s a longer-term bet. But as senior administration officials like to say, the problem didn’t start overnight, and it’s not likely to be solved overnight, either.

Last edited by Direckshun; 02-18-2013 at 05:09 PM..
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Old 02-20-2013, 09:38 AM   #31
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Originally Posted by patteeu View Post
Why should I?
Because you believe a thriving middle class is necessary for a strong economy.
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Old 02-20-2013, 09:38 AM   #32
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Why not?
you have to be kidding?

inequality is the issue?

Here we go again...If you have the desire to be something you can be.
People have made some bad decisions regarding their future and they expect someone else to pay for it.

I am supportive of providing training/education to a skill that employs people to a living wage and then yanking the entitlements from them.
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Old 02-20-2013, 09:47 AM   #33
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Originally Posted by Direckshun View Post
Because you believe a thriving middle class is necessary for a strong economy.
Aside from the fact that the Obama economy is tough on everyone and the democrats have designs on increasing taxes on everyone to pay for their neverending thirst for spending, why should I be worried about the middle class?
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Old 02-20-2013, 09:47 AM   #34
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It's just hard to buy, given the conservative support for a ton of kinds of tax repricing.
What about a liberal president that maintains a Gitmo facility, orders drone attacks that kill Americans without trial and goes into his fifth year without any meaningful prosecutions on activites that led to the recession? would you consider that president a liberal?

Just because an idea comes from someone you label conservative, doesn't mean that it is a conservative idea. there are plenty of Republicans not practicing conservatism. Hence, the Tea Party, or at least what it started out as.
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Old 02-20-2013, 09:49 AM   #35
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why should I be worried about the middle class?
Do you not think the middle class is worth worrying about?
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Old 02-20-2013, 09:50 AM   #36
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Originally Posted by donkhater View Post
What about a liberal president that maintains a Gitmo facility, orders drone attacks that kill Americans without trial and goes into his fifth year without any meaningful prosecutions on activites that led to the recession? would you consider that president a liberal?

Just because an idea comes from someone you label conservative, doesn't mean that it is a conservative idea. there are plenty of Republicans not practicing conservatism. Hence, the Tea Party, or at least what it started out as.
That's fair.

I guess I don't understand why tax repricing is a liberal idea. Maybe I can have that explained to me.
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Old 02-20-2013, 09:52 AM   #37
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Do you not think the middle class is worth worrying about?

Obama and his policies have been brutal on the middle class. They seem to be getting it slowly. Its not about them at all. And anyone who says it is is as phony as Obama.
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Old 02-20-2013, 09:53 AM   #38
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Do you not think the middle class is worth worrying about?
I don't think the biggest threat to the middle class is the ability of the rich to increase their wealth. I think the biggest threat to the middle class is the siren song of the entitlement state and the false god of class warfare.
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Old 02-20-2013, 09:54 AM   #39
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That's fair.

I guess I don't understand why tax repricing is a liberal idea. Maybe I can have that explained to me.
Could you define what you mean by "tax repricing"?
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Old 02-20-2013, 10:03 AM   #40
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Originally Posted by Direckshun View Post
That's fair.

I guess I don't understand why tax repricing is a liberal idea. Maybe I can have that explained to me.
Well, if you want to go by the strict definition of a liberal, I don't know if it qualifies, but the term 'liberal' nowadays seems go be hand-in-hand with with the concept of statism. Tax-repricing, or, a tax code that interferes with with a free market is certainly a statist approach.

You can make the claim that Republicans do it, but a conservative doesn't. At least, not how I define conservatism.
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Old 02-20-2013, 10:04 AM   #41
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We need more income redistribution - but ask Direkshun how much money he gave to charity last year. I bet very little, if he's like Obama-Gore-Clinton. All of whom were busted being cheap with their own dollars.



Direkshun should think globally/act locally on this issue. Start giving away your cash, dude.
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Old 02-20-2013, 10:41 AM   #42
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The problem is that everybody doesn't have to play by the same rules.

Inequality is fine...if people work harder, or smarter, they should be rewarded for that. If they lay about and watch TV all day, they should get what they deserve. There is no reason to take from the people that work hard and give to the people that don't do shit.

The problem, is the people that already have a ton of money have huge influence on the lawmakers. And they rig the game so that they keep making more, and taking more, and to hell with giving anyone else a fair shot. They basically make policy that allows them to do shit that should be illegal, like the shit that goes on in the derivatives market, the repealing of the glass-steagal act, and countless other shit.

The solution starts with campaign financing reform. Without that nothing is ever going to change.
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Old 02-20-2013, 10:45 AM   #43
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[quote=BigChiefTablet;9418906]The problem is that everybody doesn't have to play by the same rules.

Inequality is fine...if people work harder, or smarter, they should be rewarded for that. If they lay about and watch TV all day, they should get what they deserve. There is no reason to take from the people that work hard and give to the people that don't do shit.

The problem, is the people that already have a ton of money have huge influence on the lawmakers. And they rig the game so that they keep making more, and taking more, and to hell with giving anyone else a fair shot. They basically make policy that allows them to do shit that should be illegal, like the shit that goes on in the derivatives market, the repealing of the glass-steagal act, and countless other shit.

The solution starts with campaign financing reform. Without that nothing is ever going to change.[/quote] agree
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Old 02-20-2013, 10:48 AM   #44
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Originally Posted by donkhater View Post
OK, but the solution is not to make EVERYONE middle class.

The narrative I hear from the left is that the reason for income disparity is that the rich take advantage of 'the poor' and that evil free-market capitalism is to blame.

I agree. The rich in this country do take advantage of the poor, but it's with the help of Washington. Who passes laws that give the 1% these kind of advantages? How do life-long senators earning less than $200K a year end up being worth $100 million?

The solution, from a conservative perspective, is to cut these crony ties between business and government. Set a tax rate and don't waiver from it or provide any loopholes that give favors or manipulate the market to someone's advantage.

The minimum wage? All that does is set the bar higher for young people and others looking to get their foot in the door and change their lives.

Cut the cord. Washington's purpose should be solely to investigate and prosecute instances of fraud and other criminal activity. Having more regulations and oversight only provides more opportunities for extortion and hurts middle class businesses because they don't have the means to comply that big businesses do.
This.
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Old 02-20-2013, 12:08 PM   #45
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Originally Posted by BigChiefTablet View Post
The problem is that everybody doesn't have to play by the same rules.

Inequality is fine...if people work harder, or smarter, they should be rewarded for that. If they lay about and watch TV all day, they should get what they deserve. There is no reason to take from the people that work hard and give to the people that don't do shit.

The problem, is the people that already have a ton of money have huge influence on the lawmakers. And they rig the game so that they keep making more, and taking more, and to hell with giving anyone else a fair shot. They basically make policy that allows them to do shit that should be illegal, like the shit that goes on in the derivatives market, the repealing of the glass-steagal act, and countless other shit.

The solution starts with campaign financing reform. Without that nothing is ever going to change.
You're talking to this forum's #1 proponent of campaign finance reform.

I will agree with you, however, that inequality in and of itself is not bad. But systemically widening inequality is a problem.
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Direckshun is obviously part of the inner Circle.Direckshun is obviously part of the inner Circle.Direckshun is obviously part of the inner Circle.Direckshun is obviously part of the inner Circle.Direckshun is obviously part of the inner Circle.Direckshun is obviously part of the inner Circle.Direckshun is obviously part of the inner Circle.Direckshun is obviously part of the inner Circle.Direckshun is obviously part of the inner Circle.Direckshun is obviously part of the inner Circle.Direckshun is obviously part of the inner Circle.
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