The Distribution of Wealth and the Distribution of Power

Recently, in the process of discussing the embryonic tax bill in Congress, Treasury Secretary Steven Mnuchin made a comment that is worth considering as a whole. When asked about the Democratic talking point that such a tax cut as President Trump has described would tend to benefit the already wealthy, he said:

The top 20% pay 95% of the taxes, the top 10% pay 81% of the taxes. So, when you're cutting taxes across the board, it's very hard not to give tax cuts to the wealthy with tax cuts to the middle class. The math, given how much you are collecting, is just hard to do.

The argument is clear. The wealthy pay such a high percentage of the overall income tax bill that when cutting income taxes it is hardly possible to avoid cutting them for the wealthy if there is to be any significant cut at all. It will be noted that Mnuchin' s comment assumes in advance the practicality and desirability of a large scale income tax cut, but if we concede those points then his logic is straightforward.

The immediate practical objection to a tax cut is budgetary, but for reasons that I fail to comprehend very few people seem to be discussing tax cuts in terms of the budget. The primary argument being raised against the income tax cuts being promoted is that they would serve to give tax relief to those who scarcely need it, and increase the tax burden on the already strained middle classes.

The relative distribution of the tax bill among economic classes is a reasonable topic of discussion, but for me it is only an auxiliary to the larger and much more important question regarding the distribution of wealth. Wealth in this country over the last several decades has become as concentrated as it has ever been in the modern era. In a country of such abundance, there is a strong moral case that to see so much of it in so few hands is unconscionable.

Conservatives and a large number of economists, including those by whom I was taught, would argue that the distribution of wealth is irrelevant provided that living standards continue to improve. In their view, an economic system that allows for a large degree of inequality is justifiable to the extent that its existence provides a rising living standard for everyone, neatly summarized in the common saying "a rising tide lifts all boats" - implying that the relative size of the boats themselves is not important. This argument is stronger than its opponents generally acknowledge, but it has one major structural flaw.

That flaw is an implied premise to the effect that politics and economics are fundamentally separate matters. It is the near universal fault of economists to consider their subject matter in isolation from its social and political context. If it were the case that concentrating wealth had no negative consequences outside of additional consumption and luxury, there would be something to be said for the rising tide argument.

Yet a keen observer of our social and political life cannot fail to notice the spillovers that concentrated wealth tends to have. Especially in the wake of the Citizens United decision, which began the Era of the Super PAC, individual large scale donors have become more important than ever before. The ability of large donors to start or control their own PACs has made them more active in the determination of policy and even campaign strategy.

The entire apparatus that has so disgusted the common people of this country - the revolving door between industry, lobbying, and public office, the appointment of industry leaders to lead regulatory efforts, the shameless subordination of the public good to the cause of reelection - while always present to a degree in government, has been empowered to the point of political crisis by the ability of individual concentrations of wealth to influence the political process.

Legal restrictions on the ability of such concentrations to be politically active are essential if wealth is not to translate very directly into power. Such binding restraints as existed in this country - and those were modest, make no mistake - were utterly swept aside by the Citizens United decision.

It is difficult for me to see the increased advocacy for positions that buoy the influence of moneyed interests in government over the last several decades and pretend that it is unconnected to the corresponding widening of the wealth distribution. In the long run, the distribution of wealth is the distribution of power. Such yawning gaps between rich and poor as we observe in our time are fundamentally incompatible with the continuance of genuinely democratic (small d) government.

An orthodox socialist would observe this state of affairs and draw the tidy conclusion that private wealth itself is the problem. This falls victim to the same flaw as the rising-tide argument, except that the power-wealth relationship in this case tends to run in the opposite direction. A wealthy governing class ruling on ideological grounds is scarcely less oppressive or terrifying than one ruling by naked self-interest.

The surest long term solution is a commitment to a government that has very moderate and limited powers, as well as to an economic system that observes the same principles. Our laws guarantee to everyone the right to property and personal freedom, but the very nature of wealth and power guarantees that the hoarding of either is necessarily restrictive on both the political and economic freedoms of those without them.

Tax cuts may seem like an innocuous and mundane discussion, but they bear very directly on the relationships of wealth and power that make up our political life. It is important when we consider these questions to make sure that the policy we create is consistent with the kind of country that we want to be. While there is not a bill yet, the tax cut discussion thus far seems to be not only a result of our distorted national conversation about wealth, but destined if anything to increase its dominance in our political life.

I'm Very Angry at Senator Bob Corker and Other Observations

This week, the president entered into an absurd, degrading war of words with an influential senator from his own party. Without warning, the President of the United States accused Senator Bob Corker (R-Tennessee) of cowardice for his decision to retire following his current term, and the Senator in turn chose to debase himself by engaging in the exchange of schoolyard taunts.

Usually, I use this space to highlight aspects of the political situation that I don't think get the attention they deserve or place individual events in their larger context. I acknowledge that everything that appears here is my personal reading or opinion, but in general I aim higher than simply expressing my feelings.

This post is about how I feel. The more I think and read about the exchange between Senator Corker and the president, the angrier I get. All of the reporting that I have seen on the subject states at least in passing that the feelings the senator expressed - that the president is an impulsive political amateur who has to be constantly managed lest he do irreversible harm - are general ones among Senate Republicans, and have been present for some time.

It seems that the personal attack on Senator Corker broke his restraint in expressing those feelings. For my part, I am outraged he had the temerity to express them publicly at this juncture. If I were a member of the United States Senate, charged with making policy that effects 350 million people at home and literally billions more abroad, I would be mortified to admit to the world that I had not only countenanced but actively supported the election and administration of a man I knew to be a buffoon.

Yet this is precisely what the Republican Party establishment did. It is an extremely telling fact that throughout the primary process, in spite of the fact that everyone involved was well aware of exactly who and what Donald Trump is, the party chose to coyly feign neutrality for fear of aggravating its base voters. Those same Republicans, as Trump demonstrated his manifest unfitness for the office by pettily attacking rivals with personal insults, discounting the opinions of a judge based on his parentage, declaring that he alone among mortals had the capacity to solve the problems of the nation, denigrating the media for noticing his troubled relationship with the truth, and openly admitting a longstanding pattern of sexual harassment, continued to support his candidacy.

The Republican establishment tolerated and promoted Donald Trump because they believed that they could cash in on his populist credibility to make unpopular pet projects of theirs - repealing the ACA, enormous tax cuts tilted to the wealthy, etc - politically palatable. They were so committed to those goals, and so blinded by their desire to return to power after eight years in the wilderness under Obama, that they were willing to place an erratic incompetent with authoritarian tendencies and a wildly overblown sense of his own ability into the most powerful office in the world to achieve them. It is scarcely an overstatement to say that they have traded the dignity of the presidency and materially harmed the political health of this nation for a tax cut.

I understand that it is important for Republicans to oppose the president when he does obnoxious and absurd things. As someone concerned for the country, I welcome that opposition when it appears. Yet at the same time, I have neither sympathy nor patience for any Republican who complains about their treatment at Trump's hands when they knew all along exactly who they were supporting. It was the credibility of establishment Republicans who decided that the unity of the party was more important than having a competent president that allowed Trump, by the narrowest of margins, to attain the office. The fact that he himself cares for party unity, or anything else at all, precisely to the extent that he finds it useful seems not to have occurred to them.

So for Bob Corker to complain that Trump has insulted him, when insult is the only political skill the president has displayed in three-plus years as a public figure, is disingenuous and infuriating. For him to acknowledge, in the course of a personal spat, the inadequacy of the president he was complicit in inflicting on the country, displays an ivory-tower aloofness so removed from the everyday experiences of Americans under this administration that I am astonished he has the audacity to serve the remainder of his term as an alleged representative of the people. For me personally, it reveals a deficiency of judgment and character unworthy of someone in public office.

Democrats and the States

Right now, the Democratic Party is not only the minority party in both Houses of Congress, out of the presidency, and precariously represented in much of the federal judiciary, but it also finds itself in an advanced state of decrepitude at the state and local level. The situation is at least partly the result of the party's view of government, and its relative indifference to the lower levels of government has contributed to its poor showings there.

The largest debates in the Democratic Party in recent times have centered around the degree to which a federal presence is required in national issues to ensure that they are resolved progressively. Should the federal government provide health insurance directly, or more closely regulate the existing market? Should large banks be broken up or merely subjected to an elevated level of scrutiny? Anyone following the Democrats in the last decade will be familiar with such debates, but the thing I would like to point out about them is that the focus is entirely federal.

This is a general characteristic of modern policy debates, but it is especially so in the Democratic Party. Of the major national issues today, only abortion has been fought out mostly at the state level, and even then the constant presence of the judiciary looms over all state actions on the subject. While it is certainly true that many of the policy issues at stake have important national components, it is undeniable that state and local campaigns have faded into the background to a much larger extent than they used to.

An ideological focus on national policy, while useful in promoting large scale thinking, creates distance between the party and the grassroots.The diversity of regional interests also means that focusing on national policy limits the scope of issues that the party is seen as competent to address. For Democrats, the Obama presidency only exacerbated the problem. 

As became only too clear every time he wasn't on the ballot, the greater part of his coalition was loyal to him personally and not to the vague party apparatus. His administration was defined by a national economic crisis and a series of vicious, high profile legislative struggles, all of which served to further focus all political attention on DC.

The rise of the super PAC following the Supreme Court decision in Citizens United  further magnified the problem for state parties, drawing political money away from the party organization and into outside private groups. The PACs spend to support specific candidates rather than parties, and so vital resources failed to find their way to the state Democratic parties throughout the Obama years. The lack of a strong party apparatus at every level played a significant part in the consecutive wipeouts the Democrats faced in the 2010 and 2014 midterm elections.

The importance of state and local governments is guaranteed by the preponderance of everyday issues they grapple with. Not only abortion restrictions but welfare benefits, educational standards and curricula, voting requirements and polling districts, congressional districts, and a number of other vital issues are determined primarily at the state level. The absurdly gerrymandered congressional map that now makes it difficult for the Democrats to compete in the House of Representatives is a direct result of their staggering losses at the state level in 2010.

Unless the Democrats invest on a large scale in reinforcing and in some cases rebuilding the state parties, they risk consistent underachievement both politically and in terms of policy accomplishment. Strengthening the state parties includes paying particular attention to issues that are determined at the state and local level and cultivating executive and legislative prospects - not to mention encouraging and facilitating grassroots activism. If the Democrats do not make that commitment, the crisis of legitimacy they are currently experiencing will continue.