Economic inequality and political inequality are self-reinforcing: The wealthy advocate and lobby for policies that protect and enhance their economic position; the political establishment, in turn, is much more receptive to these interests; policies are pursued, and laws are passed, that play to these interests; the wealthy further enhance their economic position—and, hence, political position—vis-à-vis their fellow citizens; and the cycle continues.
Whether the proverbial chicken or the egg came first is beyond the point. We cannot pretend to live in a democracy based on equality, when there are such overwhelming disparities in wealth and in political resources and influence.
Some analysts attempt to explain away the growing degree of income inequality by pointing to apolitical, exogenous factors—such as a globalized labor market; increased international trade; and increased demand for skilled, rather than unskilled, labor due to technological advances. Such analysts have a tendency to view the “economy as a natural system existing prior to, and largely separate from, the political sphere.”
“Not so”, says Princeton political scientist Larry Bartels in his book Unequal Democracy: The Political Economy of the New Gilded Age: Politics and policies do matter.
To illustrate the point, Bartels compiles and analyzes a wide range of economic and electoral data since 1948. The data clearly demonstrates a marked shift upward in income inequality between the top 5 percent of income earners versus everyone else—a shift that began in earnest in the mid-1970s and has continued through the new century. (The upward shift is more pronounced the higher up the income ladder one goes).
Bartels demonstrates that income inequality was actually held steady—and in several years contracted—from 1948 through the mid-1970s. Income growth was highest for lower and middle class Americans during Democratic administrations, which accounted for periods of narrowing inequality. During Republican administrations, on the other hand, income growth was much smaller—and sometimes negative—for lower and middle class Americans, while income growth for the top third of income earners soared. But overall, during this period, income growth inequality was narrowing.
Beginning in the mid-1970s, however, income growth disparities began to grow almost exponentially. The above mentioned exogenous factors—such as a shift in demand from unskilled to technologically skilled labor—may offer part of the explanation. But policies pursued, particularly by Republican administrations, offer a more accurate explanation for this shift. (To demonstrate the weakness of the skilled versus unskilled labor rationale, Bartels shows that the real income of an engineer—a very high skilled laborer—has actually declined since the 1970s.)
Republican policies—such as tax cuts for large corporations and wealthy individuals; cuts in social welfare spending and other programs, such as job training; inflation fighting at the expense of high growth and employment strategies—have contributed to the slower (and sometimes negative) real income growth for low and middle class Americans. If this is the case, how do Republicans continue to win Presidential majorities? If most Americans fare worse under Republicans than under Democrats, how is it that Republicans fare so well in national electoral politics, particularly in winning the Presidency in five out of the seven general elections from 1980 to 2004?
The conventional wisdom is that Republicans have won these elections by preying on the social conservative leanings of lower income voters from “middle” America. Such was the conventional wisdom—offered by Tom Frank (What’s The Matter With Kansas) and others—in the wake of the 2004 election. (Race issues have also been credited with shifting the political allegiances of lower income voters from the Democrats to the Republicans, particularly in the South).
According to Bartels, however, the primary explanations for Republican electoral successes are economic. Republicans have been able to time income growth to correspond with election years, improving their chances of re-election, despite poor economic performance for lower and middle income Americans in non-election years. Republicans have successfully relied on the “myopic” nature of American voters in doing this: Voters, instead of taking a longer term view, take their immediate economic improvement (during the election year) and turn around and reward the incumbent party. This, of course, is despite dismal income growth in essentially each of the other three years of a presidential term.
The third major reason why Republicans have enjoyed relative electoral success—despite poor income growth on the whole for lower and middle class Americans—is the disparity in political resources between Republicans and Democrats. Republicans, on the whole, have wealthier contributors. Furthermore, wealthier Americans (not to mention corporations and industries) can activate more powerful lobbyists and interest groups to advocate for their interests. In short, our political establishment is more receptive to the interests of the wealthy.
Needless to say, this only further exasperates the situation, as policies are pursued that continue to favor those with the “loudest” voice in the political arena. This point could not have been made more clearly by the Supreme Court’s Citizens United decision in January, a decision made well after Bartels’ book was published. It is my opinion that the longer we allow economic inequality to spiral out of control, the deeper the entrenched interests become, and the more difficult it will be to restore egalitarian political democracy in this country. The stakes are huge and we will need brave politicians and vocal grass roots activism to restore the ideal of equal democracy.
The outcome we are already seeing is a retreat of the wealthiest Americans from public life: The wealthiest have made the collective decision—whether conscious or not—to “go it alone”. Private water supplies are replacing investment in public works; private security forces patrol gated communities, while our inner cities cannot afford an adequate police force; private schools replace public ones; private parks and beaches replace public parks and reservations. The rest of us suffer, of course, but the country as a whole will also suffer in the long-term. This hollowing out of the public sphere is reducing the importance of civil society, of civil life, which is so important to a vibrant democracy.
For these reasons, Larry Bartels’ book is a timely one; one that begins a crucial conversation where the very survival of our democracy, as we know it, is at stake--and that is not hyperbole.
