|10-15-2012, 11:50 PM|
Black for Palestine
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"Most of us are actually both makers and takers."
I like this piece, and believe it raises some inscrutable truths that are hard to hear in the bubble of the DC forum, with ideological and partisan heels having dug in, based on whoever is doing the attacking or whoever is being attacked.
One of those truths is in the OP. For all the ballyhooing we do about people reaping favorable financial rewards from the government, we almost all do. Those of us who get big deductions. Those of us who get favorable tax rates a la Romney for our investments. Those of us in certain industries that are all but directly subsidized by the government. And students, the elderly, the poor, and the sick.
So the question isn't, as the author points out, makers vs. takers. Because most of us are makers, and we're almost all takers.
The inscrutable truths of the OP:
That Blurry Line Between Makers and Takers
By TYLER COWEN
Published: October 13, 2012
Mitt Romney has apologized for his depiction of 47 percent of America as wealth takers rather than wealth makers. But his blunder touched inadvertently on some discomforting truths about the importance of politics in income distribution in the United States.
If Mr. Romney’s points were to be reformulated in a more defensible direction, the outline might look something like this:
OF MAKING AND TAKING
The correct distinction is not “makers versus takers.” The problem is that taking, rather than making wealth, appears to be growing in relative influence.
Most of us are actually both makers and takers. Consider farmers who produce food and favor agricultural subsidies. The question is whether the role of wealth maker has more influence over our politics, at any given time, than does the taker role. Is public policy being adjudicated on grounds of ethics and efficiency, or is the real story about lobbying and the relative power of different interest groups?
It isn’t easy to measure whether politics is less public-spirited these days, and we should resist the tendency to idealize the past. Still, job creation, median income and other measures of economic well-being have done poorly since the late 1990s. That suggests that America isn’t paying enough attention to creating wealth and increasing general prosperity.
FOLLOW THE MONEY
Seven of the 10 most affluent counties in the nation are near Washington, D.C. That means a growing number of educated people are making a very good living advising, lobbying and otherwise influencing the federal government. This is a talent drain. It’s far from obvious that we are getting better policy as a result, and true wealth creation has not kept pace.
As Matthew Yglesias, a columnist for the online magazine Slate, has pointed out, there is also a subtler point about those wealthy Virginia and Maryland counties. They have high per capita incomes, not only because they attract educated, government-oriented professionals, but also because their zoning and building codes limit the supply of low-cost housing. That’s a significant government intervention that hurts lower-income people, who must pay more. Privilege-seeking through government is often most pernicious when it has a tidy front and a well-manicured green lawn.
Politics based on lobbying stacks the deck against lower-income groups, who are often outmaneuvered. For instance, one of the biggest problems faced by the poor today is inadequate K-12 education. They need improved public schools, more school choice, or some mix of both. Over time, such improvements would help deal with many other social and economic issues, including global competitiveness, domestic unemployment, public health and the budget deficit, because quality education has many beneficial effects.
Instead, the current system of transfers offers to the poor various sops in place of more effective reforms. Fundamental improvements to education would involve more challenging changes to residential zoning, teacher unions and certification systems, and might also take some educational finance and control out of the hands of local municipalities. It is no surprise that well-off families want to keep a system that has done very well by them, and that the poor often lose political battles over education.
EVERYONE FEELS ENTITLED
People tend to think that they have justice on their side, whether it comes to making or taking.
For example, millions of homeowners have spent hundreds of thousands of dollars on the premise that the tax deduction for mortgages will be continued. If they support a continuation of that deduction they hardly feel like brigands, even though a bipartisan consensus of economists doubts the efficiency of this tax break.
As years and decades pass, recipients of this deduction and other benefits start to see them as deeply and richly deserved. Furthermore, almost all of us reap one or more of these benefits, so few individuals are consistently opposed to all government transfers.
It becomes difficult for a politician to articulate exactly what is wrong with this arrangement when the audience itself is in on the game and perhaps does not want to hear about its own takings.
A HISTORICAL PERSPECTIVE
The Founding Fathers were extremely worried about the threat to society posed by corruption and privilege-seeking.
Drawing on examples going back to antiquity, they understood how unmitigated wealth-taking could create a negative and cumulatively self-reinforcing political dynamic. They also understood that the Constitution — or any constitution — would be an extremely imperfect remedy for this problem.
It is therefore correct to reject Mr. Romney’s depiction as off-base and misleading. Yet the fact that he didn’t present the truth is an indication that the problem is actually worse than many of us realize.