President Obama gave a big old speech awhile back. The title of the transcript at the White House website is "Remarks by the President on Economic Mobility" but most observers called it a speech about "inequality". And (indeed) the word "inequality" appears twice as often as the word "mobility" in the text: 26 vs. 13 occurrences, yes I counted.
My default assumption about politicians bemoaning "inequality" (first noted back in 2006): it's a cynically-designed issue to inflame the populace, which they desperately hope will help them win political power. When and if that happens, the issue will be safely consigned to the memory hole.
Or, in Obama's case, in the present day, there's a likely possibility that it's an equally cynical attempt to deflect attention from the massive dishonesty and incompetence associated with ObamaCare.
Or maybe both motives apply. Doesn't matter much. It was a friendly crowd: 33 instances of "Applause" appear in the transcript, 5 instances of "Laughter", and if anyone shouted "You lie!", it didn't get transcribed.
I've collected a few reactions in my web travels:
At the AEI blog, James Pethokoukis found the
speech to be "short on facts and vision". In response to
Obama's claim that "increased inequality and decreasing mobility pose a
fundamental threat to the American dream":
But much of Obama’s argument is either dubious, deceptive, or demonstrably false. Let’s start with his “fundamental threat” claim. Is Team Obama aware of a 2009 study by researchers Dan Andrews, Christopher Jencks and Andrew Leigh that finds “no systematic relationship between top income shares and economic growth” in advanced economies. Actually, more inequality is associated with higher GDP growth, according to the analysis.
Further, Pethokoukis observes, Obama's hyper-partisanship closes off any possible alliance with conservatives who might be willing to engage in discussion of the issue. (Which makes sense if you—see above—subscribe to the thesis that it's mostly cynical posturing.)
At Cafe Hayek, Russ Roberts faults Obama's
retelling of recent economic history, a melodrama involving
decreased union membership, a minimum wage falling in purchasing power,
TaxCutsForTheRich, declining infrastructure investment, a "juiced-up"
housing market, etc., etc. Roberts takes on each claim
and finds it to be reality-challenged. For example, on
TaxCutsForTheRich and infrastructure:
This is a combination of a deception and a lie. Tax rates were reduced for all Americans in the 1980′s. But of course the rich (and lots of non-rich) pay more in taxes today than in 1980. Confusing rates and amounts is convenient. But the next line is just wrong. Investments in schools and infrastructure were allowed to wither? Please. That’s just not true.
But, as Obama has demonstrated over and over, he's not overly concerned with veracity.
Jennifer Rubin couldn't limit herself: she enumerated "10
problems with Obama’s income inequality speech". Read them all,
but here's one at random:
6. Obama is deeply insincere when he declares that “if you’re a progressive and you want to help the middle class and the working poor, you’ve still got to be concerned about competitiveness and productivity and business confidence that spurs private sector investment.” If that were the case, he’d have reformed the corporate tax code already (he said we should do it), rethought regulatory policy and set out to develop domestic energy. He touts the benefits of trade but has not completed a single free-trade agreement in five years.
But Obama's long on rhetoric, short on any action that might upset any part of the anti-business, anti-trade Democratic coalition.
Mickey Kaus is an old-style liberal, one who actually has thought
deeply about inequality. (I read his excellent book on the
End Of Equality back in the 80s.). Now blogging at the
Daily Caller, Mickey identifies "4 Things
the MSM Won’t Tell You About Obama’s Inequality Speech".
Before he runs down those 4 things, though, he notes how odd it is that the President identify inequality as “the defining challenge of our time” given that:
a. Five years into his presidency he so far hasn’t done anything to stop growing income inequality–the problem has gotten worse on his watch.
b. He doesn’t have any proposals (“It’s time to pass the Paycheck Fairness Act”) that come close to solving the problem as he defines it.
c. His one big previous initiative to reduce inequality–the Affordable Care Act–may now be hopelessly screwed up due to his own inattention and non-competence.
d. His remaining big domestic initiative–”comprehensive” immigration reform–would almost certainly make inequality worse by vastly increasing the number of unskilled workers bidding down wages at the bottom of the income scale, with the profits from the cheap labor going to business owners at the top
Mickey is always worth reading and the President served up a softball to his wheelhouse.
The scholarly Richard A. Epstein noted that the speech was
another instance of "The
Incorrigible President Obama".
As is common in speeches that romanticize history to advocate change, Obama’s address contained an unforgivable level of jingoistic nationalism: He claimed, “It was here in America that the most productive workers, the most innovative companies turned out the best products on Earth…. Today, we’re still home to the world’s most productive workers. We’re still home to the world’s most innovative companies.”
No one, not even the United States, can be that good. In fact, our present national status will only become worse if we do not understand that the American position has eroded from its glory days, in part because of the very policies that the President champions as the solution to our issues. But where to begin? The President manages to pack so many economic and historical falsehoods into his speech that it is nearly impossible to take them all on at the same time.
Professor Epstein does his best in a limited space, though.
And last but not least: the Blogfather, writing in USA Today,
noting the real "inequality" problem is the increasing split between
those whose income is earned, and those on which it is bestowed.
This problem of "work inequality" isn't addressed by President Obama, and, in fact, is exacerbated by his programs. Increased dependency on the government may have its political advantages -- as The Rainmakers sang in their 1980s hit, Government Cheese, "They'll turn us all into beggars 'cause they're easier to please" -- but it's incompatible with the notion of social equality that underlies American democracy. Beggars, even if they're doing pretty well, are dependents, and a dependent class can never really be equal members of the polity.
As Glenn notes: if we want better ideas from the executive branch, it's ever more clear that we'll have to wait until 2017 at best.