Polarized Politics on the Summer Solstice

My good friend and adopted cousin Gene Chiappetta, professor emeritus from the University of Huston, forwarded to me a link to an article with such title.   The author is Bill Stonebarger, publisher of the Hawkill News - a Newsletter for Science and Civic Literacy.  In the article, Bill laments the state of politics in America.  

"What you believe, the sauce that ties together your political, moral, and social views does matter!", he says.  He continues: "Most people who vote regularly or routinely Republican or Democrat don't have much sauce, and they do not think much or do much about what they have."

The article goes on to point out the intra-party fight between Tea Party members and the establishment Republicans, and between the Radical Greens and progressive stalwarts in the Democratic Party.  Stonebarger calls our attention to the phenomenon associated with what is popular these days, that is, that ideas are not as popular as sports, styles, or sex.  Witness the decline and anticipated demise of two iconic magazines in America: Newsweek and Time.  

The article touched a sore spot in my soul.  Like many retired colleagues, I have picked up the habit of sharing my political views in my emails with my friends, and frequently I forward news items and articles that target specific political or leisure topics to a selected number.  I am also on the receiving side of such mailings. I agree with some, but not all of them.  Some I discard immediately because I might find the content over the top for my taste.  

Two weeks ago, I emailed an email critiquing President Obama's performance as foreign policy fiascos: North Korea, Iran, Syria, Palestine, Iraq, South Sudan, Georgia, Ukraine.  I had the audacity to say that the President was leading from behind.  One of my long standing friends and colleagues sent me this angry email: "Stupid juvenile bullshit! You don't have a rational political bone in your body.  I can't believe that you are so stupid and blinded by hate.  Spare me your nonsense -- you are the fiasco.  I have added your email to junk mail - so do not bother me any more."  I was deeply shocked and hurt by the missive!  

I am one of those people that does not vote routinely Republican or Democrat.  Depending on who the candidate is, I evaluate his/her qualifications, approach, and espoused solutions.  Although I did not vote for Obama in 2012,  I was hopeful that his election in 2008 (I did not vote in 2008 because I was living abroad) would bring about less division and some breakthrough solutions to chronic problems facing the nation.  I felt that his success would be our success, and his failures are own too.   

I like president Obama as a person and family man.  However, I am not in agreement with his "ram-it-through" approach to several domestic initiatives.  Does that make me a "hater", as my friend suggests?  Not at all!  

You cannot willy-nilly accuse someone of hate because you might disagree with his political views.  Stonebarger helped me realize that my friend's reaction was the outcome of his off-the-shelf habit-forming political sauce.

Can we disagree without being disagreeable?  That is the challenge. 

Continuing debate on rising inequality in America

I have been interested in this issue for some time.  The book by Thomas Piketty, CAPITAL - in the Twenty-First Century, has sparked additional debate.  Most of the debate centers around the interpretation of the data quoted by the author, however, little or no disagreement about the extensive data in the book.

I will be quoting from the book extensively.

The author is a professor at the Paris School of Economics.  The book is the culmination of 15 years of research covering 20 countries.  Its contribution to the field has been praised by luminaries such as Paul Krugman, and other well known economics and social policy experts.  Much criticism about its conclusions have come from conservatives, however.

I am still reading the book -- a long tome of 669 pages, chockfull of historical data used by the author to illustrate trends and key findings.  In it, Piketty examines in great detail the evolution of inequality, the concentration of wealth, and the prospects for economic growth.  He suggests that modern economic growth and the diffusion of knowledge have allowed us to avoid the apocalyptic scale of inequality predicted by Marx. He concludes that the main driver of inequality is the tendency of return on capital to exceed economic growth --  a factor that might create wide discontent and eventually might destabilize societies.  

In the introductory chapter, Piketty refreshes our understanding of key principles we might have forgotten from our 101 economics class ... Malthus (Over Population), Ricardo (Principle of Scarcity), Marx (Principle of Infinite Accumulation), and Kuznets (Rising water lifts all boats).  

Piketty's main conclusions are as follows:

1.  To be aware of any economic determinism with respect to inequalities of wealth and income. The history of distribution of wealth has always been deeply political, and it cannot be reduced to purely economic mechanisms.

2.  The dynamics of wealth distribution reveal powerful mechanisms pushing alternatively toward convergence and divergence. There is no natural, spontaneous process to prevent destabilizing, inegalitarian forces from prevailing permanently. 

The Financial Times on its June 9, 2014 commentary by Lawrence Summers, former U.S. Secretary of the Treasury, and a respected economist he laments that "the rich have advantages that money cannot buy."  Summers advocates changes in our taxation to eliminate loopholes for the wealthy and to become more progressive, while also promoting a more efficient allocation of investment.  He goes on to say that the real problem is not that the rich have so much, but that the middle and lower class have so little.  

To me, as as a dilettante in economics, there seem to be practical ways to reduce the gulf between the top 1% and the rest of the pyramid.  One, treat, from a taxation point of view, profits from financial transactions, the same way we treat wages and salaries.  And two, increase our income tax credit in order to raise people's income above the poverty level.  

I suggest you read the book yourself and come up with your own conclusions.  It is a big book to absorb in a gulp.  It is the kind of scholarly work that takes at least a full semester to absorb.

Enjoy your journey along the learning curve!