December 01, 2013
For the last three decades the government has pursued a wide range of policies that have had the effect of redistributing income upward. For example our trade policy, by deliberately placing manufacturing workers in direct competition with low paid workers in the developing world, has lowered the wages of large segments of the work force. By contrast, we have left in place the restrictions that protect doctors and other highly paid professionals from foreign competition, ensuring that their pay stays high.
Similarly the too big to fail insurance that the government provides at no cost to large banks like Citigroup and Goldman Sachs allows top executives at these banks to pocket tens of millions of dollars a year. And our budget policy, that keeps tens of millions of workers unemployed or underemployed, lessens the income not only of the unemployed, but reduces the bargaining power and wages of those who are employed.
These and other government measures have the effect of redistributing income from ordinary workers to those at the top of the income distribution. Given this fact, it is peculiar that the Post would tell people in a piece on the growing strength of populists within the Democratic Party:
“many Americans are uncomfortable with the notion of the government redistributing income far beyond what happens today in order to accomplish basic elements of the populist agenda.”
The question at issue is not the amount of redistribution; the question is the direction of the redistribution. The Post seems to want readers to imagine that the upward redistribution of the last three decades was just a fact of nature, as opposed to being an outcome of government policy. That is a major distortion of reality.
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