President Obama gave an extraordinary speech about inequality yesterday, offering his most in-depth critique yet of why the growing chasm of income and wealth is so bad -- and offering a sweeping agenda for closing that chasm. That agenda included universal pre-K, raising the minimum wage, strengthening retirement systems, bringing back good manufacturing jobs, and more. All good ideas. But here's a question to ponder: Does this agenda square with what the public wants to do about inequality?
The answer is yes and no, but mainly no. As Leslie McCall explains in her recent book, The Undeserving Rich
, Americans tend to think that the best way to reduce inequality is to push business to raise wages and do more for workers, including expanding their opportunities to move upward. That makes sense: To the extent that inequality has risen because corporations and rich people are grabbing a bigger share of the pie, and trapping more workers in dead end jobs, it seems right to solve this problem by forcing the fat cats to accept a smaller piece of the pie and help build new ladders to success.
In short, by McCall's reading of years of survey data, most Americans favor market solutions to inequality. Meanwhile, the data shows they are far less supportive of solutions that leave deeply skewed earnings in place but then redistribute income downward through tax and spending policies.
Now compare those preferences with President Obama's agenda laid out yesterday. While Obama did call for a higher minimum wage and stronger unions, along with more business responsibility, his speech mainly centered on the need for stronger government programs -- including more investments in education, shoring up the safety net and social insurance programs, and successfully implementing his own Affordable Care Act. Obama didn't push higher taxes on the rich in this particular speech, but that's always been a cornerstone of his anti-inequality agenda, as it is for most progressives. Bill de Blasio hasn't put forth a plan for pushing New York City's businesses to raise wages and create better opportunity ladders for workers. But he does have a plan to hike taxes on the rich and spend the money on pre-K for poor kids.
Even the story Democrats tell about the postwar golden years -- which Obama repeated yesterday -- has moved activist government redistribution to the forefront while giving far less attention to the all-important role of unions in forcing capital to share the wealth with labor.
Over the past two decades, Democratic presidents have mainly pushed redistributive policies as the antidote to inequality. Democrats achieved a historic expansion of the Earned Income Tax Credit, enacted SCHIP, ramped up Pell Grants, and tried twice to get universal health insurance. All the while they barely lifted a finger to raise the minimum wage, pretty much ignored demands by unions to strengthen the right to organize, and colluded with Wall Street to deregulate the financial system.
Democrats have been redistributive but pro-corporate. They've approached inequality pretty much the opposite way from what most Americans favor.
The good news is that rising organizing efforts targeting retail and fast food companies are now forcing market solutions to inequality onto the political agenda. A minimum wage hike only surfaced as a top priority of Washington Democrats after this labor campaign began. Who knows, maybe next we'll see a revival of efforts to strengthen union organizing rights. The last proposal along these lines died in the Senate as Obama looked on passively.
One thing is clear: Democrats will have a better shot at truly tackling inequality once they get on the same page with the American public about this challenge.