President Obama has spent much of his time and effort “fighting economic inequality” since before his presidency began. Tax policies, spending programs, and rhetoric have combined over the past six years in particular to form a veritable War on Economic Inequality during his administration. This has led many in the Republican Party to snicker even as Democrats have mumbled lamentations over statistics showing an increasing “gap between rich and poor” during that same time period.
It is tempting to laugh off or even sneer at all this hand-wringing over the inevitable fact of inequality. Indeed, “inequality” may be taken as a whiner’s word for “variety.” Economic freedom, after all, entails rewards and punishments for good and bad choices, and also simple choices—as, for example, one may choose the life of an academic, with its many rewards, economic riches most definitely not among them unless one sells one’s soul or gets extremely lucky.
This would not at all mean that Mr. Obama and his economic policies have not failed. They have—utterly. But the proper measure of their failure should be seen in very concrete terms. The decline in most Americans’ take-home pay, the increase in long-term, structural unemployment, and the drop in overall standards of living for most Americans under this administration’s policies should speak for themselves.
Without denying any of this, I want to point out that economic inequality does actually matter, at least when it is the type and extent of inequality achieved under this administration. Mr. Obama, his advisors, and his cheerleaders in academia and the media focus on the “gap between rich and poor” as the source of all economic evil. In one sense this is intensely silly. It hurts no one, in the abstract, if the rich get richer faster than do the poor. Indeed, it may well be the case that poor people’s income and welfare are improved greatly under circumstances making the rich even richer than otherwise would be the case. Envy is neither a useful nor a virtuous character trait and it certainly does no good as the basis of public policy. Again, there are concrete reasons for worrying about the poor—if they are not, in fact, doing better, but instead doing worse, that is a harm to the well-being of real persons who are, after all, a critical part of any society, whose human dignity and needs we have a duty to address (if not necessarily through yet more government programs). But the concerns need to be related to the actual conditions of people, not simple comparisons of “fair shares” and the like.
That said, something quite troubling is happening in our economy and our society; something that can be traced directly to the deeply hypocritical policies of an administration devoted to the manipulation of people through tax codes and government programs. The “gap” between rich and poor is, in any well-functioning society, filled with the largest portion of the people, namely the middle class. One can think of the old-fashioned Bell Curve. In any mass of people, you can measure most characteristics along a curve shaped like a bell. Whether you are measuring intelligence, performance at a particular task, or income, it is natural for most people to fall “somewhere in the middle,” with those “scoring” really well or poorly showing up in decreasing numbers at the ends.
Of course, many people criticize such statistically minded observations as inhumane or even contrived. We can choose, after all, to decide that all our children are above average, though the consequences to the character of such coddled children may cause damage beyond imagining to them and to our society. Moreover, in some areas, measured in some ways, we may find that all members of a society are doing well or poorly in relation to another society or in relation to itself at an earlier time. But my point is a very limited one: Societies require a large, healthy middle class if they are to remain economically, socially, and culturally vibrant over time. We need a numerous class of people with enough money to take care of their basic needs and give them the confidence to invest and take (reasonable) risks to improve their lot in life, and the lot of their children, if we are to have the stable yet dynamic relations and characteristics that make for a stable yet dynamic economic and social order. We also need these people to maintain real connections between those who make art, be it paintings, music, or our sadly moribund crafts such as wood and glass working. If the middle class is shrinking, especially if it is shrinking a great deal at a significant pace, this is a sign that something is seriously wrong with our economy, and it signals very real troubles to come. Public policy debates will shake out increasingly as ones between those who seek to get more from the state in the form of programs and payments, and those who see the state as something they themselves run, for their own good.
And this is precisely where Mr. Obama’s policies have led us. Europhile that he is, Mr. Obama is trying to turn our nation into a cheap imitation of Europe, complete with socialist policies and a very urban character. New York City may be seen as our future. Anyone who has taken the slightest notice of developments in that city over the last couple of decades has seen where this leads. The rich get infinitely richer by manipulating highly regulated markets, be they in finance or, say, real estate. The poor actually do get poorer measured in real terms, but survive by working the convoluted system of welfare payments and other benefits set up by the government. And the middle class leaves. Some of its members literally pick up and move to greener pastures, or at least less dilapidated suburbs. The rest either claw their way into the upper classes or, far, far more often, sink into the ranks of the working or government-sponsored poor. In essence the choice increasingly must be made between having both spouses working far more than 40 hours per week, ignoring any children they might have in favor of economic pursuits, or losing the rat race, perhaps even both jobs, and going on the dole, with generations of dependency and learned helplessness a real possibility for them and their children.
We often hear that the traditional family has become obsolete because we have somehow “outgrown” it, having made different “lifestyle choices.” As we recognize the importance (and bad consequences) of these choices we also should recognize that a government that overtaxes and over-regulates also squeezes the middle class and its norms—potentially out of existence. Such a government sets up huge barriers to entry and economies of scale that punish small businesses and those who work for them; it rewards those who know how to manipulate the system more than those who work hard, work with great skill, and innovate in ways that actually improve people’s lives; it destroys that class of relatively independent, grounded citizens that once made our republic prosper, providing opportunity for poor people to improve their lot in life, a needed counter to the corruptions of concentrated wealth, and a check on the power of government to shape and mis-shape our lives. If taken too far, it is the kind of loss from which a free society cannot recover.
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