As a difficult first year of his second term winds down, President Obama is recasting his mission and that of his party. Increasing inequality and decreasing social mobility, he declared in a Dec. 4 address, present “the defining challenge of our time.” Therefore, “making sure our economy works for every working American” would be a central task of his remaining time in office.
The facts underlying the president’s claim are clear enough. According to economist Emmanuel Saez of the University of California at Berkeley, the top 10 percent of U.S. earners claimed about half of all before-tax income in 2012, including capital gains. As the president noted, the top decile’s share has been increasing since the late 1970s; it is higher than at any time since just before the Great Depression, Saez’s data show.
But it is unclear whether denouncing inequality and promising to do more about it are likely to help Obama and his fellow Democrats win elections.
Economic populism is the hardy perennial recommendation of liberal pollsters and labor-union political directors. It keeps coming back, even though election results have never quite borne it out. Deeply invested in the individualistic “American dream,” and deeply divided by race, ethnicity and religion, Americans have proven less susceptible to class-based economic appeals than voters in other nations.
Still, with the 2014 elections less than a year away, many Democrats hope that the Great Recession and the prospect of lingering economic stagnation have changed attitudes.
Raising the minimum wage, for example, is a populistic theme that 76 percent of Americans support, including a solid majority of Republicans, a November Gallup poll found.
Small wonder that Obama devoted a section of his speech to advocating a higher minimum wage — and condemning Republican resistance. Labor-backed minimum-wage supporters are promoting ballot initiatives in Alaska, Arkansas and South Dakota, red states where Democratic Senate seats are at risk, National Journal reported last week.
The idea, apparently, is that letting low-income people vote themselves a pay increase will boost Democratic turnout the same way state initiatives against same-sex marriage turned out evangelicals to support George W. Bush’s reelection campaign in 2004.
Of course, before it fizzled out, the Occupy movement was supposed to revolutionize American politics. But U.S. public opinion remains relatively indifferent to income inequality, even after the Great Recession’s harsh lessons for the middle class about economic insecurity.
Fewer than half of Americans (47 percent) consider inequality a “very big” problem, the 2013 Pew Research Survey of Global Attitudes found. Among developed nations, only Canadians, Japanese and Australians were less concerned. This contrasts with 65 percent of French respondents calling inequality a “very big” problem in their society.
What’s remarkable about the latter finding is that inequality is actually less severe in France than in the United States. There, the earnings ratio between the top fifth of society and the bottom is 4.6 to 1; here, it’s 16.7 to 1, according to Pew.
France was one of the European societies Obama cited as a model, noting that studies show “it is harder today for a child born here in America to improve her station in life” than it is for a French child.
Yet Pew reports that 70 percent of the French say that their economic system favors the wealthy and that 90 percent of them believe their children will be worse off than they are. The corresponding U.S. numbers are significantly lower.
Clearly, attitudes about inequality bear only a loose connection to income-distribution statistics. They reflect long-standing notions influenced by culture.
Obama acknowledged that his crusade against inequality must account for the fact that Americans “admire folks who start new businesses, create jobs and invent the products that enrich our lives. And we expect them to be rewarded handsomely for it.” This is less true in Europe.
Europeans consider health insurance and income support obvious roles for government, whereas the U.S. welfare state emphasizes “earned” benefits, such as Social Security and Medicare in retirement, health insurance linked to a job, or aid to veterans.
The very aspect of Obamacare that made it such a no-brainer for liberal Democrats — health care for all, whether or not you “earn” it — turns out to be one of its political weaknesses.
Still, the populist trend in Democratic ranks is strong, as evidenced by such events as Bill DeBlasio’s recent win in the New York mayoral election. What this thinking underestimates is data such as the Pew finding that only 17 percent of Americans want the government’s top priority to be fighting inequality.
By contrast, 41 percent said that job creation should be priority No. 1 — followed by reducing the national debt (28 percent).
Create jobs, slash debt, then worry about equality. Isn’t that the Republican pitch?