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128 Cards in this Set

  • Front
  • Back
Drift
-Failure of public policies to adapt to the shifting economy
-Policymakers fail to update policies due to pressure from intense minority interests or political actors exploiting veto points in the political process
-I.e. favorable treatment of hedge fund managers, taxed at a low capital gains rate
-Increasing use of filibuster → minority blocks majority
-Increasing polarization of the two parties
-People responsive to organized interests rather than disorganized voters
The Race for the Base
• Trends:
o Republicans have become substantially more conservative while Democrats have become only modestly more liberal
• Effects of Rising Partisanism
o Has elevated the relevance of the base in the electoral process
o Increased incentives and capacities of party leaders to structure the agenda and use procedural strong-arm tactics
-Candidates’ positions have become more aligned with national party doctrine, rather than voters in their own districts
New Pluralism
-Voters have tremendous capacity to get what they want
-Public policies and public preferences tend to be aligned over time
-[Challenged by 2004 tax cuts]
Tax Cut Design: Phase Ins, Sunsets, Time Bombs
Phase Ins: Unusual pattern of receiving benefits. Middle and lower class would see benefit right up front, the wealthy would see it later on, but benefit much more

Sunsets- Long term effects of policy design

Time Bombs- “detonate” in a politically favorable way
2001 Tax Cuts
-largest tax cut in 2 decades
-36% each to richest 1% and poorest 80%.
-diverged some form voter preferences, many people misinformed and confused
Marital Homogamy
coupling between people with similar education and similar earnings potential. This has created inequality, but it’s hard to combat through government policy.
Winner-Take-All Inequality
Concept that the very richest are pulling way ahead of the rest, the "runner ups." Top .01 percent richer than the top 1%, but the top .001 are richer than them. Few trickle down benefits.
-rooted in fundamental shifts in financial markets, corporate governance, industrial relations, and taxation
Americans as Conservative Egalitarians
Americans are philosophically conservative but in practice are liberal and support programs that reduce economic inequality.
What causes problems according to Nickel and Dimed
Wages are out of line with the expense of housing costs. Not enough affordable housing for visibility for the poor.
meritocratic ideal
Anyone can achieve in America with hard work, equal opportunity, etc.
-In serious doubt due to income inequality, education disparity, etc.
Intergenerational mobility
degree to which economic status of child is independent of parents (equality of opportunity)
-In American this is higher than any other modern nation except for UK.
-Children from low-income families have only a 1 percent chance of reaching the top 5 percent of the income distribution, versus children of the rich who have about a 22 percent chance.
Short-term mobility
family income changes from year to year: annual income volatility. Increased volatility undesirable to the extent that it represents economic insecurity. This has increased.
Channels by which economic status is transmitted from parent to child.
-Education, race, health and state of residence
-Policies should be designed to reduce the saliency of these factors and thereby increase mobility
AFDC
-Aid to Families with Dependent Children
-Created in 1935 as part of New Deal
-Originally intended to provide benefits for (white) widows, and enable them to not be forced to work
-By 1960, 40% of caseload blacks
TANF
-Temporary Assistance for Needy Families
-Republican bill, effective July 1, 1997
-Signed by Clinton out of desperation/a need to finally get something done on the welfare front
-Reduced welfare roles and emphasized work.
Riverside County
-California County which stressed helping people find basic jobs
-“Get a job, any job”
-Three times as effective as other programs
-Helped make welfare reform about WORK
ETIC
-Earned Income Tax Credit
-Clinton expanded it (had begun in 1975)
-The largest poor relief agent in the government, buried in the tax code so uncontroversial, only gives credit to those who work.
Medicaid
-Created in 1965
-Health program for low-income families and individuals
a. Means-tested or Public Assist Programs:
-Types of programs that provide support to families with children.
-Created to help meet the income needs of low-income families
-In these programs, recipients receive benefits based on their income, and there is often an assets test as well
-Examples of these programs:
1. Earned income tax credit
2. Supplemental Security Income (SSI)
-Other forms of means-tested programs are seen in food stamps
-Real expenditures on these programs have grown substantially over the past twenty years, most of growth seen in the earned income tax credit and Medicaid
Underclass (Murray)
-“those of the looters and thugs, and those of inert women doing nothing to help themselves or their children. They are the underclass.”
-Those who are neither thrift nor industrious and who behave self-destructively and whose socialization is deteriorating
-Unsocialized young males
-Criminal and/or non working young males
-Bulk of underclass
-Criminality-manifestation of unsocialized young male
-Illegitimacy- state of being born to single mothers, number of live births to single mothers
-Measure of those growing up without fathers
-Explanation for rise in proportion of unsocialized young males
Extreme poverty neighborhoods
neighborhoods in which 40% or more of residents have family incomes below federal poverty level
Concentrated Poverty Rate
proportion of the poor who live in extreme-poverty neighborhoods
Clustering
spatial distribution of extreme poverty neighborhoods
Neighborhoods of choice and connection
neighborhoods where the poor can choose to start and where access to good schools and jobs exists
Key Topics in Random Family
- education- opportunity and accessibility-enrollment of children needed in order for mothers to qualify for welfare
-welfare
- opportunity; difficulty of obtaining and maintaining benefits; loan sharks and the penalties that arise from spending beyond welfare income amount
healthcare costs, terminally ill children, and reliance on other people for aid
- housing
constant movement which ultimately leads to a weak foundation filthy conditions, over crowding hazardous upkeep and weather damage that families cannot afford to repair
- substance abuse
unwanted teen pregnancies males driven into drug dealing/using culture
alcoholism ;using welfare and any income to support drug habits instead of spending money on constructive vocations or on children
- prison time, visits, and constant altercations with the law.
Health Savings Accounts
-Tax advantaged account available to taxpayers in the US
-- HSAs are not a solution because it would deter people form checkups and not really deter them from unhealthy lifestyles
-advantage the wealthy, not really a shared risk solution.
Cost-shifting
term economists use to describe the way hospitals use paying patients to subsidize care for the poor
HMO
is a type of managed care organization (MCO) that provides a form of health care coverage in the United States that is fulfilled through hospitals, doctors, and other providers with which the HMO has a contract.
The Great Risk Shift
- today social help is gone because with current financial problems politicians
are tearing walls down to help protect citizens and allowing them to privatize
- employers gave tax breaks acting as mini welfare state but now they are
removing benefits and people feel as if insurance is harmful to economic
growth
- shift to individual private accounts where citizens carry the burden—“American making greater and more risky investment with buying homes, getting jobs, educating kids and paying price if they fail”
- Much less insurance and benefits to help people—higher anxiety
- Very hard to measure this risk because need to follow families over time
periods as they change, move, get new jobs, have more kids
Why Doesn’t the United States Have a European-Style Welfare State?”
Euro gov. redistribute income much more broadly, larger and more generous social
programs, more progressive taxes, regulations protect the poor
Inequality and the Senate
Senators respond much better to the rich than to the middle class and they don't respond at all to the poor.
Elitist conception of power
The elitist conception is premised on the assumption that “in every human institution there is an ordered system of power, a ‘power structure’ which is an integral part and the mirror image of the organization’s stratification.” This is a categorical assumption that presupposes that someone “runs” the community; the first questions should be whether anyone runs the community.
The elitist hypothesis that “power structure tends to be stable over time” is another problem, as “power may be tied to issues, and issues can be fleeting or persistent.” This would suggest that power is dynamic in nature—that it is contingent on specific events and issues.
Another problem arises when we consider the difference between “reputed” and “actual” power. If we assume that someone has power, there is virtually no way to disconfirm our assumption.
Pluralist conception of power
Pluralists are concerned with the exercise of power, rather than its sources, so they “select for study a number of ‘key’ political decisions, identify those who took part in the process that produced them, and obtain an account of participants’ behavior, and “determine and analyze the specific outcome of the conflict.”
This process fails to consider “the fact that power may be, and often is, exercised by confining the scope of decision-making to relatively “safe” issues,” and fails to contain any “objective criteria for distinguishing between ‘important’ and ‘unimportant’ issues arising in the political arena.
It ignores “unmeasurable elements” of political power, and these elements matter (e.g. the aforementioned constraining of the agenda to ‘safe’ issues).
It also ignores situations in which power breeds complacency—for example, a professor who chooses not to speak up because of his concern that he will be outvoted, or that his speaking up will be interpreted as disloyal to the university, or for any other reason.
Voluntary Groups
“Human scale” organizations that connect local people to each other and in turn connect local branches to an overarching national or state organization. These organizations often complemented governmental structures and encouraged civic participation. Examples include the Knights of Columbus, National Rife Association and Boy Scouts of America.
Professional Groups
Nationally run groups that are managed professionally, often Political Action Committees that rely on funding from businesses and donors. They are often heavily involved in national politics. Examples include The Environmental Defense Fund, the Heritage Foundation and the Cato Institute.
Social capital
– features of social life- networks, norms, and trust- that enable participants to act together more effectively to pursue shared objectives
Civic engagement
peoples connection with the life of their communities, not only politics
GSS
General Social Study, conducted yearly for over two decades and measures many different aspects of social life, engagement, etc.
Civic Institution
an organization that requires active involvement (as opposed to clubs or interest groups that take money but don’t require a lot of time. An example would be going to church regularly vs. sending money to a political party)
Why has civic participation declined?
-The social upheavals of the 1960s challenged the traditional social structure that had helped to uphold civic organizations. The Vietnam War, new concepts of gender, more single-family homes, changing conceptions of “manly” ideals and racial desegregation were included in these upheavals.
-The rise of advocacy groups and lobbying made the traditional political power of organizations decline. These new groups give more opportunities for the wealthy to channel their money into a political force.
-The gap in political involvement between educational and economic elites and the rest of Americans has also grown over time, and more educated Americans have been less likely to join voluntary groups.
AFL-CIO
America's largest union, has experienced steep decline, possible reasons: Managers (have motivation), Union leaders (institutional incompetence, failed to recruit more into unions), Workers (possibly decided that unions did not serve their interests)
National Labor Relations Act (NLR)
Depression-era legislation requiring employers to recognize unions if majority of workers vote for unionization
Trade Union
primary worker institution in capitalist economies
Open-Source Unionism?
Operates through networks rather than bureaucracy. Enlists members regardless of whether they can achieve a majority. More of an interest group for labor.
-Working America = AFL-CIO’s take on this, gathered information in areas deemed conducive to unions, got 2/3 of canvassed people to sign up. Encourages voting, information, hires staff to analyze legislation.
-Suggests that US has vast untapped market for a labor organization to give voice to workers.
-Unions are not a market good. There is a need but no entrepreneur can sell unions to the market. Thus, someone needs to fill the gap and find a way to organize labor, because unions are important for the US economy.
Felon disenfranchisement
practice of removing right to vote upon conviction of felony
-Retribution, deterrence, incapacitation, rehabilitation: this practice does not fit with any of these
• Richardson v Ramirez- 1974 Supreme Court case upholding felon disenfranchisement.
Political quiescence of poor
Lack of political engagement of poor
Pell Grants
assistance for low-income students to go to college.
Electoral college system and popular vote
The president is not elected with the popular vote explicitly representing the people as a whole. The Electoral College is indirect. Instead of voters electing the president, they vote for electors from their state who vote for them. If they wanted, they could vote for any candidate they wanted, but pledge to vote for the candidates that their constituents want in office.
Two Senators for each State
Each state has two senators in the United States Senate. This is an unrealistic representation of the population because many states are much larger then others. With polar opposites in size like California and Rhode Island, it is undemocratic to give those states the same number of votes. Granted, the house of representatives combats this problem, but with almost the same powers, the senate could be structured in the same way.
Gerrymandering
o State legislatures are permitted to redraw the lines of U.S. House districts every 10 years
o The redistricting lines of 1991 caused for the Republicans to gain “safe” seats along with their “alliance” with blacks and Hispanics to gain “safe” seats
o The GOP also made expensive redistricting software available to minority groups to split up the white liberal vote and ghettoize the nonwhite liberal vote
• Plurality Winners
o Recent rise of third-party politics threatens to strengthen the hold of the two dominant parties in Congress
o Miniscule returns for a Green Party candidate can throw an overwhelmingly progressive district to the Republicans, just as a spoiler Libertarian Party candidate can ensure the election of a Democrat in predominantly conservative districts
• The third party candidate loses, and the wrong major party candidate wins
• Proportional Representation
o Most liberal democracies have rejected plurality voting because of its unfair and paradoxical results
o Instead they elect their legislatures by some version of proportional representation
o The distribution is more suited to accurately reflect the distribution of districts
o Under this system, gerrymandering, plurality winners, and swing votes simply disappear
o A party could no longer win 100 percent of the seats because they could only win their percentage of votes
o Swing voters would disappear because of multiparty systems
• Multiparty system might help reduce the polarization of American politics
• A coalition of two or more parties would probably hold power in the House and Senate, a party would gain little political capital by attempting to demonize the president
o Interests tend to coagulate into a handful of substantial parties which eliminates the problem of tiny fanatical parties
• Must have a certain percentage of the national vote rather than just winning their district vote
o Simple Subject:
defines a class of equal citizens granting each person the same formal rights and there is no discrimination between people in the society; all people would have equality when it comes to policy making as well as every other part of society
o Segmental Subjects
In defining segmental subjects, he says equality is required within a subclass but it is not necessary between a subclass (ie: it is just if lawyers to make more than sales clerks as long as lawyers make around the same amount of money as other lawyers)
o Bloc-equal Subjects:
defined by two features: 1) the subjects of equality are divided into two or more subclasses, and 2) equality is required between subclasses (blocs) and not within them (looking at the classic example of Plessy v. Ferguson to display racial blocs, no particular individual, black or white, need be accommodated equally to any other, but the two blocs, each taken collectively, are to be so treated)
o Rotating Winners and Losers
This is the idea that the disadvantaged class could somehow rotate simple inequalities so that there are less victims of this inequality in the disadvantaged class and more in the advantaged class. The end result would still, most likely, result in inequality but the formerly disadvantaged class would become the more advantaged class
o Simple Equality of Subjects
This is the idea that the underlying inequalities can be overturned. There is no need to change the composition of an underclass if no such class exists.
- Justice as Fairness
o First: each person is to have an equal right to the most extensive basic liberty compatible with similar liberty for others.
o Second: social and economic inequalities are to be arranged so that they are both
• Reasonably expected to be to everyone’s advantage
• Attached to position and offices open to all."1
- The first of these two principles is known as the liberty principle, while the second half, reflecting the idea that inequality is only justified if it is to the advantage of those who are less well-off, is known as the difference principle.
Primary goods
things that every rational person wants, regardless of life path. Resources, social goods, self respect, health, intelligence, imagination
basic capability equality
people being able to do certain basic things. Thinks it is very culturally specific

• In particular, almost everyone, (esp. in the US) professes to support “equality of opportunity” an equal chance to succeed
• But at root, that demands that ambition, hard work etc be rewarded, but not natural talent, inherited resources, etc.
• Yet, in practice, the line between natural and acquired ability and success is blures
Why Worry about inequality?
• Economic inequality itself violates fundamental norms- rawls vs. norzick
• Economic inequality reflects deeper ones, ie inequality of opportunity
• Economic inequality is inherently harmful to those at the bottom (relative standing matters). Inequality and mortality
• Economic inequality creates deeper inequalities, political inequality
o Is there something about your position relative to others that matters
Gini Coefficient
• A measure of how far a society is from a perfect equality, a straight line. Most societies are right skewed- people at the top have much more income. What is the 90th percentile devided by the 50th? The larger the number, the more inequality. Or, you can ask what percentage of income goes to what segment of society. They can also tell you if the top is rising above, or the bottom is falling above
Files in the education ointment
• College wage premium has not grown consistently since 1990s
• More inequality is within group
• Gap driven by decline at the bottom rather that rise among college educated
• Other countries have not seen the same increase in inequality despite similar education distribution
• Most of income rise at the top, with very rich pulling away from the merely well off many of whom have college or post college degrees. “golden ticket” is a random feature or some feature of people’s abilities.
The three R’s
• Democracy aspires toward equal consideration of citizen’s interests.
• Rights- equal right of all citizens to participate and enjoy basic civil protections
• Responsiveness- leaders responding to clear considered and frim preference shelf by strong majorities of citizens when doing so is consistent with number 1
• Resistance- political leaders in power face real and routine rsk of losing office.
• Path dependence
self-reinforcing historical processes
• Early policy choices sent the American welfares state down a distinctive historical path from which departure has been highly difficult.
o That’s why it matters a lot when you get a social breakthrough
-health insurance versus retirement pensions
Hacker's Health Care for America Plan
• Shared risk- new national insurance pool modeled after Medicare, open to US residents without good workplace or individual coverage
• Shared responsibility- employers and self employed give health insurance or pay money to cover their workers
• Individual responsibility- require that people have coverage
o This would let 47% had insurance thorough employer, 50.7% through health care for America, 1.4% other, and .5% uninsured. Health care for American kept Medicare and Medicaid in its program
What is poverty?
Relative vs. absolute
income versus comsupption.
The poverty line is absolute and on income
More poverty
The majority of the poor don’t live in concentrated poverty. Most of the poor live in areas with less than 20% poverty in the surrounding area. The poor are more scattered than we to think.
• Ghetto poverty is declining. Was rising steadily in the 1980s and 1990s, but at last check in 200 it was coming back down.
• However there are lots of cities where there is an exception.
Blacks are not the majority of the poor, but blacks are more likely to be poor.
Why welfare? The four P’s
• Paternalism
• Pity- many we are afraid that one day we will need help
• Productivity
o Ideal of a safety new in a democratic capitalist society
• Protection
o Economic unrest
o Political/civil unrest- trying to keep the poor content and not protesting
What is Welfare?
• Narrow definition: temporary assistance to needy families, formerly Aid to Families with Dependent Children (formerly, aid to dependent children) Cost: $20-25B
• Broader definition: means-tested programs- Medicaid, supplemental security income, food stamps, the earned income tax credit- yet many of these are not seen as “welfare.” $200-280B.
• In terms of public opinion, “welfare” seems to mean cash aid for able-bodied adults, and perhaps near-case substitutes such as Food Stamps.
Past Barriers to welfare reform
• Duel clientele trap- helping poor kids helps their parents, penalizing their parents hurts them
• Money trap- more effective reforms require spending more. Welfare was relatively cheap. Critique of welfare was that wer were spending too much. People have an incredible skewed view of what they believe the government spends money on. This did not bode well for people who said we had to spend more
Mobility (income, occupation, wealth, etc)
• Absolute mobility
o Do you experience real gains?
• Relative mobility
o Do you move up relative to others?
• Intergenerational mobility
o Do you move up in comparison with your parents? (Absolutely or relative to their class standing).
Three aspects of American ideal of meritocracy
• Basic equal opportunity. at least K-12 schooling
• Fair, open process with selection for higher education (with some adjustments for disadvantage or past discrimination or other goals besides academic excellence such as diversity)
• Mixes instrumental and intrinsic views: system is good for society overall and achievement within that framework is mar of good character/motives
o Remember, college has become more like high school was, so should we be more concerned about disparities at the college level?
“Resegregation” of public schools.
So the research is clears that this process occurred mostly in urban areas. African Americans and Latino are segregates and so are their schools- so either we improve the quality of these schools so that whites don’t move or send their kids to private schools, or alternatively to reduce the amount to residential segregation itself.
Equality of opportunity sum
• If opportunity is defined as upward mobility, the glass is probably half empty, while it is real
o Lower rates of intergeneration um than in other nations
o Lower rates than in the past
• Neighborhood disadvantage is persistent, esp. for blacks
• Education central to equality of opportunity
• Yet education’s role in ensuring this compromised by
o Pre-K gaps
o Localized financing
o Segregation by race and class.
• K-12 may be becoming less of a guarantee of equality of opportunity
Minimum Wage
• The minimum wage that can legally be paid to a person. You can be paid less than this in certain contexts. States sometimes have higher minimum wages. Upswing in recent years is due to minimum wage increase passes during the Clinton administration. Not indexed to inflation, it falls as the economy grows, in buying power and in relative to average wages.
• Who gets it
o Most are young, ½ are under 25.
o About 6% women, 4% men
o Does not vary much across the race and ethnicity groups
o 10% less than a high school diploma earned it, 4% high school diploma and 3% college
o the higherest proportion of workers earning at or below the federal minimum wage was in service occupations.
Not really a job killer, well bellow living wage
ETIC
• Earned income tax credit
• Dates to the mid-1970s
• Essentially a wage subsidy. Not a negative income tax, you can’t get it unless you’re working. For working Americans based on their family structure, they can claim it. Its refundable. If they have no tax liability, they still get a check. Inversely proportional to their income.
• Major expansions in 1991 and 1993. Lifted about 5 million out of poverty
o Why
• Helped the working poor- alternative to the minimum wage, offsets the payroll taxes
• Distributional effect of budget deals
• Political competition for votes of working poor? (Howard 1997)
 Focused on most sympathetic portion of the poor. Republicans and democrats agreed.
• This has risen dramatically, even though republicans were in comtrol for all but 2 years during this entire power, 1976-2010.
• Mostly goes to people at the bottom of the ladder. Under $25,000 up to about $5,000.
• Remarkable because its folled into the tax code. Lack of visibility, this makes it a bonus. BUT there are lots of eligible people who don’t claim it because they don’t know about it, and they don’t feel grateful to the government in the same way as when they get a social security check.
Consequences of Polarization
• Stalemate
• Greater accountability? (Ir? Responsible Party Government” only works with greater accountability)
• Lack of faith in government.
• People don’t like ideological division
• “unequal Polarization” republicans have moved farther to the right than democrats have to the left.
Inequality as a political issue
• Rich people and poor people vote differently, they vote more differently the more different they get, so they polarize the partices. This doesn’t work very weel. There is more income sorting, and that has increased, but no enough to come close to explaining this trend. Can only explain 1/5 or less.
• Its not os much the bases of the parties that have shifted, btu that inequality itself is a polarizing issue, and politicians are fighting more aggressively over it and thus getting more polarized.
Median voter model
• Median voter model: Median voter is right in the middle, so politicians have to aim for the middle. Basic logic: the farther the mean relative to the median, the more the median voter is likely to benefit from redistribution. (transfers > tax burden) More market inequality → more redistributive policy preference for the median voter.
• Potential explanation of apparent non-self-interested voting.
o Cross-cutting issues (especial social issues/race/religion) don’t carry the most weight as people care more about economic issues
o Lack of reliable cues/information. Decline of union
o Timing of the business cycle
o Belief in upward mobility
o Cynicism/lack of faith in government.
o Support for Republic economic policies/ management.
How accurate are Americans in their thoughts about inequality?

Does misunderstanding make a difference?
• Europeans believe that they have higher inequality, Americans underestimate inequality. Americans and Europeans think there should be similar inequality levels
• Our precieved levels of income are lower than they actually are
• So we do have egalitarian tendencies, but we underestimate what people at the top earns
• There are vast asymmetries in this knowledge- some people know a lot, others not much at all.
• Yes- when people are told the actually differences in income inequality, much more people agree that the government should be involved. There is a large amount of bias perception. Most people see the world in ways that concern their prior belief.
o Among liberals, the more they know the more likely they are to say income inequality has rise, but for conservatives it decreases with time. So peoples perceptions are totally dependent on their beliefs.
Partisan Political Economy
• How can presidents have this much influence anywar? Macroeconomic policy? That does produce short term income gain, but ldoes it produce long term shifts. Maybe swe need to look at other areas. Would you put this much stake on presidents? What about congress? Are these changes about both parties? Then we wouldn’t expect to find this much of a difference between parites and the partisan divides? So the partisan story doesn’t work very well.
2001/2003 Tax cuts
• The top 1% received 36%, bottom 80% got 37%. So… why? They posed risks to other programs, totally skewed.
o A majority of Americans said they supported the tax cut. 11% had no idea. The problem here is that the real debate was about how the government should be using the surplus, it was more than taz cuts. Americans had other priorities, like paying down dept, preserving social security of medicare. The people didn’t care for the structure of the tax cuts.
o On the design, mose wanted the size cut significantly, more for lower income, and for the cut to be reduces if the surplus eroded- 70%! 52% wanted it ejected of for major changes to be made.
o An internal memo shows that the administration wanted to mask trade offs.
Paul Krugman, “For Richer,” New York Times Magazine, 20 October 2002.
Rich are getting richer. Republicans support this.
Thomas Cooley, “Has Rising Inequality Destroyed the Middle Class?” Forbes, 3 June 2009.
- Cooley claims that there isn’t enough solid economic data to support the idea of disappearing middle class.
- He also claims that most of the economic action/inequality resides in the top 1 percent of the economy, rather than the entire top 10 percent
Amartya Sen, “Equality of What?” Liberty, Equality, and Law: Selected Tanner Lectures on Moral Philosophy (Cambridge University Press, 1987).*
- This is a very dense article that talks about what exactly do Americans want in equality and issues with making a utility argument
- It tosses out the notion of Utility—saying interpersonal comparisons are impossible.
- Offers multiple other critiques of utilitarianism throughout.
John Rawls, Justice as Fairness: A Restatement (Harvard University Press, 2001), Part II, 39-61.*
- Justice as Fairness consists of two principles:
o First: each person is to have an equal right to the most extensive basic liberty compatible with similar liberty for others.
o Second: social and economic inequalities are to be arranged so that they are both
• Reasonably expected to be to everyone’s advantage
• Attached to position and offices open to all."1
- The first of these two principles is known as the liberty principle, while the second half, reflecting the idea that inequality is only justified if it is to the advantage of those who are less well-off, is known as the difference principle.
- Rawls argues that the two principles would be chosen by representative parties in the original position — a thought experiment in which the parties are to choose among principles of justice to order the basic structure of society from behind a veil of ignorance — depriving the representatives of information about the particular characteristics (such as wealth and natural abilities) of the parties that they represent.
Douglas Rae, Equalities, 20-44.*
Equality for whom? Single subject versus segmental subject, bloc- equal subjects (ie ) the subjects of equality are divided into two or more subclasses, and 2) equality is required between subclasses (blocs) and not within them)
Emancipation via rotating winners and losers or simple equality of subjects.
Robert Gordon and Ian Dew-Becker, “Unresolved Issues in the Rise of American Inequality,” 7 September 2007
o We must understand not only changes in means, but also changes in distribution.
o Changes in inequality can be indicative of changes in the structure of the economy that may favor one group or another.
o Tell us how well our theories about risk sharing and consumption smoothing actually fit with peoples’ experiences.
o We can learn about the effects of various institutions on the inequality by studying the experiences of different countries; this allows for informed policy choices to be made in the future.
Emanuel Saez, “Striking It Richer,” 5 August 2009.
- A significant fraction of the surge in top incomes since 1970 is due to an explosion of top wages and salaries
- The evidence suggests that top income earners in 2007 were not “rentiers” deriving their incomes from past wealth but rather are “working rich,” highly paid employees who have not yet accumulated fortunes comparable to those accumulated during the Gilded Age. The possible repeal of the federal tax on large estates in the coming years would accelerate the path toward the reconstitution of the great wealth concentration that existed in the US economy before the Great Depression
- Factors that explain this increase in inequality
o Underlying technological changes
o Retreat of institution developed during the New Deal and World War II (progressive tax policies, powerful unions, corporate provision of health and retirement benefits)
o Changing social norms regarding pay inequality
Robert Dahl, How Democratic is the American Constitution? (2003), Ch. 3-5, 8.*
-Electoral college, Broad Judicial review and Executive Supremacy and the senate make the US constitution undemocratic and represent us unequally.
Michael Lind, “Alice Doesn’t Vote Here Anymore,” Mother Jones, March/April 1998.
Gerrymandering, the swing vote, and plurality winners (ie a green party candidate throwing the election to the republicans) make the US less democratic than nations that have proportional representation.
Joe Soss and Lawrence Jacobs, “The Place of Inequality: Non-participation in the American Polity,” Political Science Quarterly (2009).
• Over past three decades, American’s policy preferences have been stable, but government policy has moved right.
-rich people participate more then poor people. government responds more to rich than to median voter.
-poor people are also not rioting or protesting this, they are not engaged in politics.
Christopher Uggen, Angela Behrens, and Jeff Manza, “Criminal Disenfranchisement,” Annual Review of Law and Social Science (2005).
Felon disenfranchisement doesn't fit with retribution, deterrence, incapacitation or rehabilitation. Purity of ballot box, lack of trust in felons, fraud and states rights other possible reasons.
-huge disparate impact on blacks. this effects political outcomes. the supreme court has upheld this.
Richard Freeman, America Works, Ch. 5.*
Unions have been declining since the 1950s.
• Three possible reasons:
o Managers (have motivation)
o Union leaders (institutional incompetence, failed to recruit more into unions)
o Workers (possibly decided that unions did not serve their interests)
o Unions raise pay of workers, reduce inequality, increase pension coverage, provide health insurance, give workers democratic voice at workplace. bad for the top .1%.
-Possible solution- open-source unionism, like interest group. vast untapped market.
Robert Putnam, “The Strange Disappearance of Civic America,” American Prospect (December 1996).
-people have been becoming less and less involved in their communities. Possible reasons: Busy-ness/time pressures, economic hard times, stresses of two career familiar, disruption of family/marriage ties, residential mobility, civil rights revolution, TV
-more education - more likely to join. maybe generational effect.
- Prime suspect: TV. Heavy readers=joiners; heavy viewers=loners
Theda Skocpol, Diminished Democracy, Ch. 1-6.
Falling participation in voluntary groups has damaged U.S. political participation. -Since WWII the number of groups founded has fallen off dramatically. Groups once served as part of a private supplement to the welfare state. The decline of groups was caused by several factors, including social upheavals.
Peter Bachrach and Morton Baratz, “Two Faces of Power”
We should reconsider our conception of how power is exercised in society, as both “elitist” and “pluralist” conceptions of power are deficient. Elitists are wrong because there is not always an ordered system of power. Pluralists are wrong because they don't remember that part of power is limiting the agenda to "safe" issues
Larry Bartels, “Unequal Democracy” Chapter 9
Rich Americans hold a great deal of influence in politics, while poor and middle class Americans have virtually none. Senators align with their party and not their state. Senators largely follow the wishes of rich constituents, especially if they are republicans, and about all issues, not just economic issues. this stands even when factoring in voting and contacting patterns. less extreme than just paying attention to campaign contributions, however.
Martin Gilens, “Inequality and Democratic Responsiveness”
“When Americans with different income levels differ in their policy preferences, actual policy outcomes strongly reflect the preferences of the most affluent but bear virtually no relationship to the preferences of poor or middle-income Americans.”
-This is not because representative influence constituents' opinions.
-Presidents make the strongest preference/policy link when they are up for reelection and are neither too popular nor too weak.
-high income > high education
Alberto Alesina, Edward Glaeser, and Bruce Sacerdote, “Why Doesn’t the United States Have a European-Style Welfare State?” Brookings Papers on Economic Activity (2001).
-Euro gov. redistribute income much more broadly, larger and more generous social
programs, more progressive taxes, regulations protect the poor
-We have more income volatility (but more mobility), no proportional representation, we protect private property, income tax less progressive, we think govn't wastes, different history and culture, geographical isolation, no socialism.
Jacob S. Hacker, The Great Risk Shift (2008), selections.*
Volatility of income has skyrocketed and instability is more of a problem than inequality
-too much has been privatized, too many protections removed.
-employers removing benefits. shifts to individual private accounts, less collective responsibility.
-this is hard to measure b/c must follow families over time.
Brink Lindsay, “Poor-Mouthing Prosperity,” Wall Street Journal, 21 Sept. 2006.
-response to Hacker
-there is more volatility, but Hacker’s view that personal responsibility crusade is bad is wrong. consumption still stable and we are better off overall.
-improving things like Medicaid, M.Care and Social S would require crippling tax increases.
Jonathan Cohn, Sick
healthcare is failing Americans.
-HSAs not a solution, won't encourage check up or deter unhealthy lifestyles.
-medicare pools risk.
-France has a good system, we need more cost sharing.
Adrian Nicole LeBlanc, Random Family.
The urban poor face many problems- education, opportunity, housing, substance abuse, crime, prison, etc.
Alan Berube and Bruce Katz, “Katrina’s Window: Confronting Concentrated Poverty Across America,” Brookings Institution Metropolitan Policy Program.
Concentrated poverty has high costs for society. Within metropolitan areas, suburban growth left the poor behind in inner city as economic opportunity and wealth moved outward with suburbs. Federal, state, and local policies favor high-income suburban development over urban development. Policies have geographically confined poor households (especially poor black ones) to inner-city. Suburbs excluded affordable housing. Education in area is poor, no good examples, vicious cycle.
Charles Murray, “The Hallmark of the Underclass,” Wall Street Journal, 2 October 2005.
Assumption: people who find jobs will get them and can support their families sufficiently. “The poverty Katrina underscored is primarily moral, not material.” Criminality has increased, we just lock up more criminals. More illegitimate young men makes for more people who don't want jobs. Because underclass are too lazy to work and aren’t thrift. No one who has a job remains poor.
R. Kent Weaver, Ending Welfare as We Know It (2000), Ch. 2.
AFDC in early 1990s:
o Benefits had been falling and falling. Caseloads had been rising and rising.
o Popular beneficiaries had left: working poor were increasingly on EITC instead, and widows increasingly covered by other social insurance programs.
o Incentives very poorly structured. E.g. choosing to work instead of receive AFDC often meant little net gain in income, on top of a loss of Medicaid benefits.
o Excessively complex bureaucracy weakened program and wasted money.
o Controversial and politically unpopular at a level disproportionate to the program’s size
Jason DeParle, American Dream, Ch. 5-8, 12.
Welfare reform was difficult to bring about. o President Clinton came into office full of hope and determination to make welfare programs better and more efficient, but really lost steam once he was in office and ultimately signed the Republican’s bill (after vetoing it twice) out of resignation and a lack of commitment to any more liberal social cause
o The new welfare regulations have resulted in a massive decrease of the number of people on welfare rolls due to the various hassles involved (such as required job searches)
• This was good (fewer people dependent on welfare) but also bad, since these requirements drove away many people who couldn’t live well otherwise and were now in a greatly compromised societal position
• Rolls have gone way down while unemployment rates, poverty rates have stayed the same (though now higher due to economy)
Spending on poor now more about working poor. In 2002, states enrolled 1/3 of eligible caseload in work
Tom Hertz, “Understanding Mobility in America.”
We care about intergenerational mobility. • Education, race, health and state of residence are four key channels by which economic status is transmitted from parent to child.
o Policies should be designed to reduce the saliency of these factors and thereby increase mobility
difference in mobility for blacks and whites persists even after controlling for a host of parental background factors, children’s education and health, as well as whether the household was female-headed or receiving public assistance.
-US has lower intergenerational mobility than most Euros. lowering cost of education would help.
“Ever Higher Society, Ever Harder to Ascend,” Economist, 29 Dec. 2004.
• growing evidence suggests that the meritocratic ideal is in trouble in America
America’s engines of upward mobility are no longer working as effectively as they once were
• upward mobility is increasingly determined by education
• America’s great universities are increasingly reinforcing rather than reducing these educational inequalities
Horatio Alger. Ragged Dick, Chapter 27
Ragged Dick moves up in society, shows the American ideal. Wants to help his friend move up the ladder.
- Jennifer Hochschild and Nathan Scovronick, The American Dream and the Public Schools (2003), Introduction and Chap. 1.
Public schools are all really different and not giving students as much support as they once did.
- Robert Haveman and Timothy Smeeding, “The Role of Higher Education in Social Mobility,” The Future of Children (Fall 2006).
There is a significant gap in college preparation, attendance and completition for poower students.
Things that might help include- outsourcing housing/food for colleges, universal preschool, more college prep, finalcial structures that favor low income students, cap subsidies to private schools, low repayence based on post-college salary.
-overall the current system rienforces inequality.
- Ron Haskins, “Economic Mobility of Immigrants in the United States,” July 2007.
Immigrants today and their children face lower mobility than other segments of the society.
- Barbara Ehrenreich, Nickle and Dimed (2001).
Housing costs too high, poverty line is silly, wages remain low and stagnet, the poor always lose in market competition, government should provide more for the needy.
Lawrence Jacobs and Benjamin Page, “Class War? Americans as Conservative Egalitarians”
This piece refutes the claim that most Americans ignore economic inequalities, oppose egalitarian programs and hate taxes especially progressive taxes aimed at the wealthy. we still believe in the american dream.
-Overall, americans want to help the poor, conservative in philosophy but in practicallity they are liberals. a disconnect between public opinion and policy.
Lane Kenworthy, et al., “The Democrats and Working Class Whites.”
Democratic affiliation has declined for the entire working class across all segments. The conclusion of the study determines the issues were the driving force behind the shift. These issues include, changes in working-whites views on certain issues, shifts in party positions, changes in the importance of certain issues and most importantly change in their confidence in democratic officials to come through with legislation on issues.
- Jacob S. Hacker and Paul Pierson, “Winner-Take-All Politics,” Politics & Society (forthcoming); and selected responses.
Current economic studies have three weaknesses
- Downplay the distinctive feature of American inequality: the concentration of income gains at the top of the economic ladder
- Miss the profound role of government policy in creating this “winner-take-all” pattern
- Give too little attention to the long-term transformation of the organizational landscape of American politics that lies behind these changes in policy.
-inquality is winner-take-all, little trickle-down. gains sustained and growing. gaps in skills not greater in other nations. **Drift. increased polarization. labor declining while business expanded. tax code has enabled inequality. decline of unions not natural but political.
Lane Kenworthy response to Hacker and Pierson’s Winner Take All Politics
Doubts that increase in business’ political capacity led to shifts in policy (or policy drift) which led to increased income ineequality. said shift of perception of american economic preformance, shifts in republicans and technology, competition, corporate governance instead caused this.
Andrea Louise Campbell response to Hacker and Pierson’s Winner Take All Politics
wanted more focus on why ordinary citizens don't effectively protect their interests. low salience of economic issues, lack of info. lack of firm preferences abour redistribution,progressivity. lack of informing organizations.
Hacker and Pierson’s response to commentators
1. Summarize their argument: (1) focus on gains at the very top, (2) policy, both new policy and the failure to adjust policy to change (drift) played critical role in generating those gains, and (3) changes in organization of political power were central in policy changes. other explanations insufficient.
Larry Bartels, Unequal Democracy (2008), Ch. 6.*
2001 tax cuts- most important domestic policy of last decade.
Question is why little public response when public favors greater equality? -- Public believed rich pay too little in taxes, believed government should spend more on various programs, and believed cuts would favor rich but also supported tax cuts – Why?
1. Evidence of ignorance and uncertainty about tax policy
2. People who believed they paid too much in taxes supported the cuts
3. At lower income levels, better informed people less supportive of cuts
4. Public opinion is not cause but resource to be used and shaped by elites in making policy
Hacker and Pierson, “Abandoning the Middle,” Perspectives on Politics 1 (2005).
Focuses on the 2001 Tax Cuts; Intersection of two forces occurred
• The increasing incentives of the political elites to cater to their partisan and ideological base and (2) the increasing capacity of politicians who abandon the middle to escape political retribution
• Analyzes the “deliberate crafting of policy to distort public perception”
• Hope to promote discussion of voters’ capacity to protect their interests in a democracy
• Will Wilkinson, “Thinking Clearly About Economic Inequality,” Policy Journal, 14 July 2009.
-Income should be the relevant indicator of inequality in individual well-being
-Consumption inequality has remained stable. Poor and rich people both have TVs, etc.
-Income inequality should not be the measure of social justice
o It also wrongly believes that economic inequality can easily be converted into political inequality, especially alter a certain threshold
o The wealthy have recently supported the left more than the right
Lane Kenworthy, Is Consumption the Grail for Inequality Skeptics?
• Consumption doesn’t account for:
• Investing money
• Retiring early
• Taking an unpaid sabbatical
• He says we need better data on consumption at the top and that even if consumption inequality has increased only modestly, that by no means renders the large rise in income inequality moot.
Lane Kenworthy, “The High-Employment Route to Low Inequality,” Challenge, September/October, 2009
Summary
Kenworthy says that most of the factors driving inequality are difficult to change through policy and government intervention. He argues that the best way for government to combat inequality is by moving toward full employment. He then spends the rest of the article describing policies that different types of countries can implement to get closer to full employment. But when you look at it, taxes really aren’t that effective at combating inequality. If anything, government transfers have helped dampen the trend toward inequality. But with an aging population, it’s unclear whether that can be sustained.