Posted: 08 Sep 2015 12:06 AM PDT
Posted: 07 Sep 2015 10:02 AM PDT
Against What Benchmark Should We Measure Equitable Growth Performance?: I find the very sharp Marty Felstein engaging in a goalpost-moving effort that I cannot endorse:
'Support for Redistribution in an Age of Rising Inequality: New Stylized Facts and Some Tentative Explanations'
Posted: 07 Sep 2015 09:17 AM PDT
From the NBER:
Support for Redistribution in an Age of Rising Inequality: New Stylized Facts and Some Tentative Explanations, by Vivekinan Ashok, Ilyana Kuziemko, and Ebonya Washington, NBER Working Paper No. 21529 Issued in September 2015 [open link to earlier version]: Despite the large increases in economic inequality since 1970, American survey respondents exhibit no increase in support for redistribution, in contrast to the predictions from standard theories of redistributive preferences. We replicate these results but further demonstrate substantial heterogeneity by demographic groups. In particular, the two groups who have most moved against income redistribution are the elderly and African-Americans. We find little evidence that these subgroup trends are explained by relative economic gains or growing cultural conservatism, two common explanations. We further show that the elderly trend is uniquely American, at least relative to other developed countries with comparable survey data. While we are unable to provide definitive evidence on the cause of these two groups' declining redistributive support, we offer additional correlations which may offer fruitful directions for future research on the topic. One story consistent with the data on elderly trends is that older Americans worry that redistribution will come at their expense, in particular via cuts to Medicare. We find that the elderly have grown increasingly opposed to government provision of health insurance and that controlling for this tendency explains about 40% of their declining support for redistribution. For blacks, controlling for their declining support of race-targeted aid explains nearly 45% of their differential decline in redistributive preferences (raising the question of why support for race-targeted aid has fallen during a period when black economic catch-up to whites has stalled).
Posted: 07 Sep 2015 08:53 AM PDT
The Republican base "doesn't actually share the Republican establishment's economic delusions":
Trump Is Right on Economics, by Paul Krugman, Commentary, NY Times: So Jeb Bush is finally going after Donald Trump. ... Mr. Bush has chosen to attack Mr. Trump as a false conservative, a proposition that is supposedly demonstrated by his deviations from current Republican economic orthodoxy: his willingness to raise taxes on the rich, his positive words about universal health care. And that tells you a lot about the dire state of the G.O.P. For the issues the Bush campaign is using to attack its unexpected nemesis are precisely the issues on which Mr. Trump happens to be right, and the Republican establishment has been proved utterly wrong.
To see what I mean, consider what was at stake in the last presidential election, and how things turned out after Mitt Romney lost.
During the campaign, Mr. Romney accused President Obama of favoring redistribution of income from the rich to the poor, and the truth is that Mr. Obama's re-election did mean a significant move in that direction. Taxes on the top 1 percent went up substantially...
Conservatives were very clear about what would happen as a result. Raising taxes on "job creators," they insisted, would destroy incentives. And they were absolutely certain that the Affordable Care Act would be a "job killer."
So what actually happened? As of last month, the U.S. unemployment rate, which was 7.8 percent when Mr. Obama took office, had fallen to 5.1 percent..., lower than it ever got under Ronald Reagan. And the main reason unemployment has fallen so much is job growth in the private sector, which has added more than seven million workers since the end of 2012. ...
And here's what's interesting: all indications are that Mr. Bush's attacks on Mr. Trump are falling flat, because the Republican base doesn't actually share the Republican establishment's economic delusions.
The thing is, we didn't really know that until Mr. Trump came along. ... This is a real revelation, which may have a lasting impact on our politics. ...
I'm not making a case for Mr. Trump. There are lots of other politicians out there who also refuse to buy into right-wing economic nonsense, but who do so without proposing to scour the countryside in search of immigrants to deport, or to rip up our international economic agreements and start a trade war. The point, however, is that none of these reasonable politicians is seeking the Republican presidential nomination.