What Don’t You Understand?

This is another one of those days when I read the NY Times and just want to bang my head against a wall:

Nordstrom has a waiting list for a Chanel sequined tweed coat with a $9,010 price. Neiman Marcus has sold out in almost every size of Christian Louboutin “Bianca” platform pumps, at $775 a pair. Mercedes-Benz said it sold more cars last month in the United States than it had in any July in five years.

Even with the economy in a funk and many Americans pulling back on spending, the rich are again buying designer clothing, luxury cars and about anything that catches their fancy. Luxury goods stores, which fared much worse than other retailers in the recession, are more than recovering — they are zooming. Many high-end businesses are even able to mark up, rather than discount, items to attract customers who equate quality with price.

“If a designer shoe goes up from $800 to $860, who notices?” said Arnold Aronson, managing director of retail strategies at the consulting firm Kurt Salmon, and the former chairman and chief executive of Saks.

The rich do not spend quite as they did in the free-wheeling period before the recession, but they are closer to that level.

The luxury category has posted 10 consecutive months of sales increases compared with the year earlier, even as overall consumer spending on categories like furniture and electronics has been tepid, according to the research service MasterCard Advisors SpendingPulse. In July, the luxury segment had an 11.6 percent increase, the biggest monthly gain in more than a year.

Yeah. That’s a real shock. What part of HIGHEST CONCENTRATION OF WEALTH SINCE THE 20’s DON’T YOU UNDERSTAND? Jeebus:

As you can see, the nation’s income distribution may be quite lopsided, but its wealth distribution is even more so.

The top 1 percent of earners receive about a fifth of all American income; on the other hand, the top 1 percent of Americans by net worth hold about a third of American wealth. (Note that the top income earners are not necessarily the same people as the top net-worth Americans — after all, lots of high-net-worth people don’t work or have much else in the way of sources of new income.) Wealth-related inequality has also been relatively stable over the last few decades, whereas income-related inequality has been growing since the ’70s.

Why is there more inequality in wealth than in income, both today and yesterday?

Remember that wealth accumulates over time. The highest earners are able to save much of their incomes, whereas lower earners can’t. That means high earners can accumulate more and more wealth as time goes on (assuming they don’t blow it all, of course).

Higher-earning Americans also have the resources to pay for better tax preparation, which helps them reduce their taxes and save even more money. On the tax front, note also that people who have already accumulated wealth stand to earn a lot in capital gains, which are also taxed at a lower rate.

Our Galtian overlords have the most money they ever have, their taxes are at the lowest levels they have in many decades, and they have plenty of money to blow on luxury items. Why? BECAUSE THEY HAVE ALL THE FUCKING MONEY. It’s no coincidence that luxury items are flying off the shelves while concomitantly, the middle class is slowing down their spending on food, furniture, etc. In fact, this is precisely the point many dirty hippies have been trying to make- we are never going to have an economic recovery until some people other than the Kochs and Warren Buffet have money to spend. And with unemployment at astronomical levels and with the official government policy to make things worse with austerity and then hope a magical unicorn comes sliding down a rainbow showering jobs on the middle class, it is going to stay this way. Fer fuck’s sake.

Meanwhile, while all this is going on, our elites are blowing sloppy wet kisses to wingnuts like David Frum who finally realize “Hey- Maybe Krugman knows what he is talking about and Stephen Moore and the other hacks at the WSJ are clueless.” We’re so screwed.






110 replies
  1. 1
    burnspbesq says:

    Now that we have today’s Two Minutes Hate behind us, can we talk about solutions, and how to achieve them? Or will that be interpreted as Obottery?

  2. 2
    Linnaeus says:

    You’re just jealous of the Producers in our society, John. Pull yourself up by your bootstraps! Freedom!

  3. 3
    Rosalita says:

    I love the part where they try to be stealthy about their luxury items — not big into logos anymore. They are worried about getting the tires on their Mercedes slashed if they are too flashy with Manalo’s and Hermes’ bags. I was glad I read this with an empty stomach this morning.

  4. 4
    Villago Delenda Est says:

    The solution is simple.

    Tumbrel rides for these assholes.

  5. 5
    Rosalita says:

    OT – but I saw that the video and story about that police beating of the homeless man in Fullerton, CA made MSNBC news… one of the FPers posted about that last week.

  6. 6

    Tut-tut. Surely this is opening up marvelous opportunities for those in shopping bag carrying, yacht polishing and other menial jobs industries.

  7. 7
    Odie Hugh Manatee says:

    The ‘plan’ is for us proles to slave away for the rich for a mere pittance while they spend the money for our economy. They’ve had this worked out for some time now, it just took time for them to buy enough politicians to make it work.

    For a while anyway.

  8. 8
    slag says:

    We’re so screwed.

    Have you considered going back to bed and getting up on the other side? It always works for me. As long as I don’t read, listen to, or think about anything afterward, that is.

  9. 9
    wrb says:

    I’ve long been puzzled by there not being more of a focus on inheritance tax.

    There are reasonable arguments for letting people accumulate most of what they earn in their lifetimes: the efficient meritocracy should produce more overall wealth etc. but there are few for supporting a class of Paris Hiltons.

    Eliminate trust funds, institute a confiscatory inheritance tax over, say, $1m and we would have much more opportunity and social mobility,- and, in theory, a much more productive economy that produces more wealth.

    A platform of replacing income taxes with inheritance taxes should have appeal, I’d think.

  10. 10

    Medical Warning.
    If this quote didn’t make you want to break into an exclusive country club and run amok with a rusty farm implement, you are dead:

    “If a designer shoe goes up from $800 to $860, who notices?” said Arnold Aronson, managing director of retail strategies at the consulting firm Kurt Salmon, and the former chairman and chief executive of Saks.

  11. 11
    General Stuck says:

    President Krugman could work. He’d have to dump the baggy britches and constant fidgeting, so run Paul run.

    he could get us a big donkey stimulus, and we would live happily ever after.

  12. 12
    Kane says:

    Meanwhile,

    Wal-Mart is selling smaller packages because some shoppers do not have enough cash on hand to afford multipacks of toilet paper.

    And yet, if anyone should complain, they are quickly accused of playing class war.

  13. 13
    Villago Delenda Est says:

    @wrb:

    Thomas Jefferson considered instituting an Estate Tax to be one of his most important achievements.

    He wanted to prevent the accumulation of wealth over generations to avoid the conditions that developed in Europe he saw on his diplomatic missions there. The vast disparities of wealth, and the accumulation of wealth in the hands of a few.

    He didn’t want America to develop a hereditary aristocracy in all but name.

    Which it has.

  14. 14
    Violet says:

    And the stock market is tanking today, after two weeks of falling. I wonder how our Galtian overlords feel about that.

    If Democrats don’t play the class warfare card this election, they’re really stupid. Or they’re in the pockets of these guys, which is probably the case. Sigh.

  15. 15
    Martin says:

    Maybe the DNC needs to hire Matt Damon.

    I didn’t start a small business with my tax break, and I don’t know anybody else who did. Everybody’s socking their money away. Nobody started a business with their first tax cut…that just defies common sense. I was against those tax cuts, they were ridiculous. So little is asked of the upper class anyway, what percent of them or their kids are fighting in any of these wars?…If you walk down Fifth Avenue, there’s no sense of shared sacrifice.

  16. 16
    The Snarxist Formerly Known As Kryptik says:

    And yet, we mostly just hear about “OMG, the bottom 50% don’t pay taxes, what a fucking robbery, TAX THOSE LAZY BUMS ALLL!!!!”

    Meanwhile the top 10% get away with everything and shove our faces into it with all that luxury consumption. Trickle fucking down indeed….

  17. 17
    Rosalita says:

    @Kane:

    Linky? I just googled walmart smaller packages and came up short…

  18. 18
    Cervantes says:

    Same as it ever was, John, same as it ever was.

  19. 19
    wrb says:

    He didn’t want America to develop a hereditary aristocracy in all but name.
    Which it has.

    yep. What we have is nothing like the theoretical “capitalist” system that was described in my econ 101 class.

    We now live in a country with a feudalist economy.

  20. 20
    Rob says:

    Don’t worry Matt Yglesias tells us its a good thing! After all those stores employ people too!

  21. 21

    @Kane: ReaLAMEricans wipe with God-given leaves.

  22. 22
    gex says:

    Also too, one of my big problems with the opposition is this view of us as “enemies”. Frum uses it directly. The reason the right is unable to countenance any compromise or moderation is because pundits like him have made this a war between real Americans and us. We’re enemies, hell bent on destroying America rather than fellow citizens with a different opinion. Even when he’s not trying to make it worse with his opinion, he makes it worse anyhow.

    ETA: That kind of phrasing is why Americans tend to favor liberal policies when the policies are described, but to oppose them if they are labeled as liberal policies. Rhetoric like Frum’s is breaking this country.

  23. 23
    slag says:

    @Thoughtful Black Co-Citizen: I was supposed to be going to a country club wedding next month, but my RSVP got lost in the mail. Oops.

    Actually, the real reason I’m not going is that, apparently, my subtle brand of humor is not as subtle as I think it is. Oops.

  24. 24
    rufflesinc says:

    I just don’t understand how this is sustainable. Unless SCOTUS decides to allow the rich to start buying elections outright, are the voters going to keep this up?

  25. 25
    Violet says:

    @Rosalita:
    Google the exact sentence he quoted. It’s from the NYT article John linked.

  26. 26

    whoa,wait a second, what is wrong with 860 dollar shoes you can’t run, jump, or stand around in for very long?

    you would think, at those prices, they could afford to make shoes in america.

  27. 27
    NonyNony says:

    @wrb:

    I’ve long been puzzled by there not being more of a focus on inheritance tax. … There are reasonable arguments

    Stop. Right there. Stop.

    The argument against the inheritance tax is inherently UNREASONABLE. To the effect that if you actually use reason in the argument you won’t understand why the anti-inheritance tax folks have any traction at all.

    The anti-inheritance tax argument is inherently an EMOTIONAL one – it deliberately obfuscates how much money you need to be passing on to your kids in order to get the listener to side with the billionaires.

    Emotional arguments are all that work in our political structure – reason doesn’t work. You can look at the greatest liberal political successes of the 20th and 21st century – the creation of Social Security and Medicare, the Civil Rights Act, the ongoing push for gay rights that has more and more successes every day. You can support these political activities with reason and rational arguments but they weren’t won because of reason and rational arguments. They were won by appeals to pure emotion – nobody wanted to see the elderly dying on the streets, with TV people were forced to put themselves into the shoes of black civil rights protesters being hosed down by redneck sheriffs and having dogs sicced on them, and the push by the gay rights folks to move gay people out of their closets and into people’s lives means that now everyone knows a gay person, or at least knows someone who knows gay people.

    You can’t reason shit like this out. This is the techocratic fallacy – debates in democracy are not won via reason and rational thought because voters do not have enough information to actually be able to understand which arguments are rational and which are bogus. So they go with their emotions.

    This is how the conservatives have hacked democracy. To fight it you gotta figure out how to get that raw emotional appeal back. The gay rights folks have shown that it still works for liberal causes.

  28. 28
    SensesFail says:

    But, but, but…

    Al Gore is fat, so he probably buys a lot of food.

    :P

  29. 29

    I love the part where they try to be stealthy about their luxury items—not big into logos anymore. They are worried about getting the tires on their Mercedes slashed if they are too flashy with Manalo’s and Hermes’ bags.

    Good luck with that. If their pet Republican Legislators keep it up it will soon be very easy to spot the super-wealthy:
    Has all of his own teeth.
    Not suffering from malnutrition.
    Not clad in worn out clothes.
    Lives in a house.
    Has bathed with in the past week.

  30. 30
    Davis X. Machina says:

    Part of the problem with the middle class is the middle class. It’s playing a zero-sum game, against the house.

    You can’t really blame its members for being in a more or less permanent defensive crouch the last couple of decades, but no small part of American politics in my lifetime has been a middle class that looked at itself and says “Great. I’m in the tree-house. Now where’s that ladder”, and starts pulling it up.

    Now, lo and behold, the tree-house is shrinking….

  31. 31
    Xenos says:

    Of course, real sans culottes never needed toilette paper!

    As for those Saudi princes heavily invested in both Fox News and American stock markets, I hope they get taken to the cleaners.

  32. 32
    Xenos says:

    Of course, real sans culottes never needed toilette paper!

    As for those Saudi princes heavily invested in both Fox News and American stock markets, I hope they get taken to the cleaners.

  33. 33
    Cat says:

    @Rosalita:

    Its in the quoted article…

  34. 34
    Rosalita says:

    @Violet: I’m a dope! thanks V.

  35. 35
    Maude says:

    @burnspbesq:
    Republicans won’t go along with changes to the tax code. The offshore tax that Obama wanted to reverse went nowhere.
    McConnell said, at the time that he was worried about the multinational companies.
    I don’t see solutions on the horizon with a Republican majority in the House.
    One problem with the political talk is that the rich people who are not a problem get blamed as well as the poor people who are not the problem.

  36. 36
    Violet says:

    @NonyNony:

    This is how the conservatives have hacked democracy. To fight it you gotta figure out how to get that raw emotional appeal back. The gay rights folks have shown that it still works for liberal causes.

    This is exactly right. And the left has plenty of things to make emotional appeals about, but they don’t do it. People are angry about bankers getting away with all the money and the gaping chasms between CEO earnings and their employees and the richest 1% and the rest of us. There’s plenty of emotional stuff to work with, but the folks on the left just don’t seem to know how to make the rational-sounding emotional appeals.

  37. 37
    rufflesinc says:

    Fuck it, I’m going Galt and not having kids. See how much you assholes can grow the economy without growing the population.

  38. 38
    Culture of Truth says:

    Job Creators® !!!!!!!!!!!

  39. 39
    wrb says:

    @NonyNony:
    I agree with regard to the need for emotional arguments (tat is why I used the cheap Paris Hilton example,-although I should have come up with a fresh one. Was lazy).

    I said there were reasonable arguments for keeping taxes low on money someone earns. I don’t see ANY reasonable arguments for large inheritances.

  40. 40
    The Snarxist Formerly Known As Kryptik says:

    ….guh.

    I actually read the article after my initial smark….am I wrong in feeling like it reads off like this is an objectively good thing? Like the rich deserve and NEED to be spending like this, and the markets disproportionately catering to the luxury market, because us lazy slobs just don’t have enough to spend to keep the economy running?

  41. 41
    H.E. Pennypacker, Wealthy Industrialist says:

    Oh John, you sound like a big red socialist.

  42. 42
    Ash Can says:

    I don’t care how much the wealthy spend, or what they spend it on. But the idiot writing the article should be pilloried for saying that the wealthy may be contributing disproportionately to a (potential) economic recovery. What the hell kind of a multiplier effect does money spent on luxury goods have? By saying this, this horse’s ass does nothing but play along with the destructive myth that the wealthy are the primary engine of economic growth. It makes me want to kick stuff.

    But once again, looking at this article more broadly, I really have to wonder what the NYT is getting at by publishing stuff like this. Despite my own rantings, economic theories aren’t going to be the main takeaway from stuff like this. It’ll be more like, “Up against the wall with them!” Not every NYT reader is wealthy.

  43. 43
    Citizen_X says:

    @wrb:

    there are few [arguments] for supporting a class of Paris Hiltons

    Arguments? Oh, aren’t we fancy? Try, “screaming ‘DEATH TAX! DEATH TAX!’ repeatedly, and lying about the estate tax applying to people leaving $50,000 to their kids.”

  44. 44
    Villago Delenda Est says:

    @The Snarxist Formerly Known As Kryptik:

    The thing is, and that well known Marxist hack Adam Smith makes this clear in his vile soshulist screed The Wealth of Nations, is that a well paid labor force is the key to generating greater “opulence” in a nation’s economy.

  45. 45
    Martin says:

    The anti-inheritance tax argument is inherently an EMOTIONAL one – it deliberately obfuscates how much money you need to be passing on to your kids in order to get the listener to side with the billionaires.

    The argument for the inheritance tax is also an emotional one, though an argument I’ve never seen pushed in any real way.

    The inheritance tax ensures that inheritors don’t need to go through all of grandmas records to identify the cost basis of everything they inherit. It’s a clean solution to an emotional trauma – in addition to everything you need to deal with, don’t require tax forensics on top of that, simply pay this flat tax on the FMV and we’re done.

  46. 46
    Violet says:

    @Ash Can:

    I really have to wonder what the NYT is getting at by publishing stuff like this.

    Lots of outrage = lots of eyeballs. That’s what they’re getting at.

  47. 47
    The Snarxist Formerly Known As Kryptik says:

    @Villago Delenda Est:

    Yeah, funny how all those free-marketeers never mention that. Adam Smith would be considered a hippie these days for daring think that Gov’t has any place in making a good economy run outside of regulating theft.

  48. 48
    maye says:

    While I don’t know anyone buying $9K handbags, I do know a few regular middle class folks who live in other countries who are going on shopping sprees in the U.S. because the’ve never had a better exchange rate. I have a friend here from NZ is is amazed at how much far her $ is going. I also read wealthy Europeans are finding NYC a bargain hunters paradise.

  49. 49
    Dennis SGMM says:

    And how many of those most negatively affected by these economic imbalances would even consider joining a labor union? How many blame the Chinese or illegal immigrants or some other “other” for the shape they’re in?

    Americans let themselves be distracted by easy credit and a seemingly endless supply of cheap crap while the pols stacked the deck in favor of the wealthy. There’s no easy fix for that when less than half of eligible voters even bother to show up on election day to vote their own interests.

  50. 50
    R. Porrofatto says:

    Capitalism is global now. Our overlords owe no allegiance to any country but their own penthouse plutocrats. It doesn’t matter if there is no longer a middle class here to buy their shitty, shrinking products (or more likely, a middle-class pension fund to buy their worthless financial products), because labor is cheap and there are markets elsewhere.

    David Tepper, a hedge-funder who I’m sure we all know and who made a measly $4 Billion dollars in 2009, has a $99 million ATM cash account just for mad money. If Americans could ever grasp the real scope of the thievery and the enormity of the wealth lifted from their pockets, and the damage done to them just to feed the insatiable greed of a few they’d… oh who am I kidding, they’d change the channel to a “reality” show.

  51. 51
    NonyNony says:

    @Violet:

    This is exactly right. And the left has plenty of things to make emotional appeals about, but they don’t do it.

    Because the emotional appeals from the left have all been classified as class warfare by wealthy people. If a left-leaning politician makes a hint of a case that large income people need to pay more taxes, media talking heads (who make a lot of money) employed by large media companies (whose owners make a lot of money) immediately being the drumbeat of CLASS WARFARE. It never fails. The wealthy in this country have perfected that line of attack over the last 50 years and they ain’t going to give it up.

    I’m not sure how to get out of this trap – if I knew I’d be doing it. But it seems like something’s gotta change or we’re going to reach the point where the rich really do start to see some class warfare being inflicted on them from the lower classes. And we’re not talking the “increase the top marginal tax rate” “boy who cried wolf” class warfare here either.

  52. 52
    Omnes Omnibus says:

    @The Snarxist Formerly Known As Kryptik: That Smith guy was some kind of foreigner anyway. He even wore wigs, for gawd’s sake. Why would anyone take him seriously?

  53. 53
    wrb says:

    @NonyNony:

    the drumbeat of CLASS WARFARE. It never fails. The wealthy in this country have perfected that line of attack over the last 50 years and they ain’t going to give it up.
    I’m not sure how to get out of this trap?

    Reply, “Damned right!!” ?

  54. 54
    Culture of Truth says:

    Meanwhile….
    100,000 Israelis rallied on July 30 in Tel Aviv, Jerusalem, Haifa and other cities across the country to protest high prices. “A wave of populism is sweeping over the country,” Netanyahu said.

  55. 55
    Amir_Khalid says:

    @Fucen Pneumatic Fuck Wrench Tarmal: The point, if you want to call it that, is that the shoes are exclusive (exquisitely crafted in small quantities just for the rich folks, not mass-produced for the common folk). The high price (the higher the better, exact number unimportant) just adds to the exclusiveness.

    Women’s shoes are generally unfit for purpose, as you point out. They are flimsy; harmful to feet, legs, hips and back; and dangerous to wear on many surfaces. But I believe that’s a separate, gender-related issue.

  56. 56

    @burnspbesq: Now that we have today’s Two Minutes Hate behind us, can we talk about solutions, and how to achieve them?

    Well, we know there’s a market for luxury items. The manufacturing and production sectors just need to team up with Marketing to bill all consumer goods as “luxury” and crank the price up 800%. You know, Luxury Broccoli for $25.00/pound, Luxury Lumber for $160/board-foot, that sort of thing. There’s that trickle-down!

  57. 57
    A Mom Anon says:

    @NonyNony: It could help to point blank say that the folks with more money than brains(9K for a coat? Unless that bad boy can run a laptop,ipod and my car,wtf does anyone need with a 9K coat? Such bullshit,gah) are laughing at the rest of us. There has to be a way to get that across to people,at least the ones that aren’t hopelessly lost. They are laughing at us and looking down their noses,honest to god,it could not be more fucking obvious.

    As for the Class Warfare shit? I say embrace it. You bet your ass it’s class warfare,if we don’t do battle with the fuckers they’re going to kill the country entirely. If you can’t live on less than a couple million a year you have fucking problems money won’t fix. Fuck you and your class warfare sideways. I am sick of these fuckers whining and crying after they got rich off the backs of people who do the REAL work.

  58. 58
    Mike Goetz says:

    The main problem is that our entire socioeconomic and political structure is geared toward getting proles to fight with other proles. That’s your real class war and it is damaging as hell.

    The issue really isn’t inequality as such. As long as everybody has a decent and livable basis, I don’t care if some people have more. You can get where you are going in a no-frills sedan; who cares if a few people get a Mercedes.

    The main task of Democratic governance (in education, in employment, in basic human services, etc.) is to make sure everybody at least gets the sedan. Even doing that much is going to be abominably hard.

  59. 59
    donnah says:

    Fuck the poor, indeed. Here’s a letter to the editor straight from our local newspaper today:

    “Re Voter ID: It is time we require everyone to verify who they are when deciding who will be in charge in our country. If you are on any public assistance, you lose your right to vote. How can we expect someone to have a logical say when that’s how they are surviving? If you want to live off others, they should be deciding how much and when.”

    This is what we’re up against. This is the unadulterated hatred of the poor.

    jesus fucking christ.

  60. 60
    Violet says:

    @NonyNony:

    Because the emotional appeals from the left have all been classified as class warfare by wealthy people. If a left-leaning politician makes a hint of a case that large income people need to pay more taxes, media talking heads (who make a lot of money) employed by large media companies (whose owners make a lot of money) immediately being the drumbeat of CLASS WARFARE. It never fails. The wealthy in this country have perfected that line of attack over the last 50 years and they ain’t going to give it up.

    All that means is that it’s time to challenge the conventional wisdom. The average person is pissed as hell that CEOs make 200% more than the average worker in their company. The average person sees that rich people get richer and their own dollar doesn’t stretch as far. So WHAT ARE PEOPLE AFRAID OF? Call it what it is. SO WHAT if the talking heads freak out? That just means they’ve hit where it hurts.

    Seriously, I don’t get why people are so afraid of the right wing talk machine. Ratings for them are dropping, even Limbaugh. People are pissed off and struggling. A little honest talk with easy to understand emotional appeals would go a long way, I think.

    It feels like the Wizard of Oz. People are afraid of the right-wing media machine behind the green curtain, but pull back that curtain and you’ll see the vulnerable people behind it. PULL BACK THE CURTAIN!

  61. 61
    Omnes Omnibus says:

    @Mike Goetz:

    The issue really isn’t inequality as such. As long as everybody has a decent and livable basis, I don’t care if some people have more. You can get where you are going in a no-frills sedan; who cares if a few people get a Mercedes.
    __
    The main task of Democratic governance (in education, in employment, in basic human services, etc.) is to make sure everybody at least gets the sedan. Even doing that much is going to be abominably hard.

    Well said.

  62. 62
    jl says:

    A little off topic, or maybe not.

    Good excuse to repost a link to Tom Paine’s Agrarian Justice.

    Give a copy to your teabagger friends and explain what it says to them. Ask them to remember it the next time a mascot in a Founder’s suit is rolled out at a teabagger rally.

    Wikipedia entry on Agrarian Justice
    http://en.wikipedia.org/wiki/Agrarian_Justice

    Text link from Wiki entry
    http://en.wikisource.org/wiki/Agrarian_Justice

  63. 63
    kt says:

    burnspbesq: “Now that we have today’s Two Minutes Hate behind us, can we talk about solutions, and how to achieve them?”

    Congress is too far gone to save. I think the only real way we’re going to change any of this is on a state level. A combination of direct voting for major policies and a strong push for states rights would have the twofold advantage of making it very hard for small groups of noisy extremists to hijack the policies of an entire state and would create evidence-based test cases for eventual federal policies.

    For example: If submitted to a direct vote, drug reimportation would likely pass in most states and with a year or so of actual data to work with, it could be kicked up to the federal level giving Congress and the Senate real facts to work with rather than ideological or drug company spin.

    America’s 50 states should become active policy laboratories and we should start using them in a search for fact based solutions.

  64. 64
    catclub says:

    Did any one else notice that although income inequality has risen oer the past 30 years, the articles quoted (if I read correctly) said that wealth inequality has NOT risen. This makes no sense when they go on to say that wealth inequality leads to wealth inequality.

    I are confoozed.

    ETA: “Wealth-related inequality has also been relatively stable over the last few decades, whereas income-related inequality has been growing since the ’70s.”

  65. 65

    @Violet: Lots of outrage = lots of eyeballs.

    I’m not so sure. The New York Times is published, after all, in New York City. It’s the paper of record for the whole nation, but in some sense it’s still written for the Upper West Side. The NYC middle class isn’t outraged by the ultra-rich, it wants to emulate them.

  66. 66
    Kane says:

    @Violet:

    And the left has plenty of things to make emotional appeals about, but they don’t do it.

    Wisconsin democrats are leading by example. Kathy Hochul’s campaign in NY is also another example of how to make an emotional appeal at the local level. The Left needs to adopt these models and use them on the local and national level.

  67. 67
    Linnaeus says:

    @NonyNony:

    I’m not sure how to get out of this trap – if I knew I’d be doing it. But it seems like something’s gotta change or we’re going to reach the point where the rich really do start to see some class warfare being inflicted on them from the lower classes. And we’re not talking the “increase the top marginal tax rate” “boy who cried wolf” class warfare here either.

    What the anti-SB 5 folks in Ohio are doing might be instructive. The overall theme they’re going with is fairness and it’s been a powerful argument against the patently unfair SB 5. I don’t know how well you could generalize that theme to other things – and it wouldn’t in of itself be sufficient – but it’s something to think about.

  68. 68
    Stillwater says:

    This may not go over well in these pro-Krugman ranks, but one of the big problems our economy faces is neoliberalism and continued offshoring. Every job offshored means less cash infusion into the domestic economy and obv less overall spending. So not only do these practices directly increase unemployment, they also deny the domestic economy of important multipliers of money use that indirectly causes even more unemployment. On the flip side of this, we’ve been told that raising global boats will increase demand from those now bouyant countries and create new jobs (sound familiar?). But as a matter of logic, the increased demand cannot replace those lost jobs. Until US labor rates get much, much lower. That’s part of what’s driving the current Austerity Now! hysteria.

  69. 69
    fasteddie9318 says:

    @Mike Goetz:

    The issue really isn’t inequality as such. As long as everybody has a decent and livable basis, I don’t care if some people have more. You can get where you are going in a no-frills sedan; who cares if a few people get a Mercedes.

    “Inequality as such” has never been the problem and I doubt you could find many who would say that it is. Extreme inequality is the problem. When our tax structure is subsidizing top-of-the-line Mercedes for our overlords at the cost of basic healthcare for everybody else’s parents and grandparents, then inequality has become a problem. And short of torching some of those Mercedes, I don’t know how you fix it. The political process is failing miserably.

  70. 70
    randiego says:

    From Sam Stein’s twitty – RNC already slamming Obama for cutting Medicare. Shocker…

    Sam Stein
    @samsteinhp Sam Stein
    that didn’t take long. RNC: It Was Obama Who Offered To Cut Hundreds Of Billions In Medicare During The Debt Debate http://bit.ly/o2FMoM

  71. 71
    jl says:

    @47 The Snarxist Formerly Known As Kryptik

    True. Adam Smith had a particular fear of the precursor of today’s international corporations, the joint stock company. One of his concerns was that powerful joint stock companies could use their access to cash, through monopoly rents or by ability to borrow, to capture the legislative process, and they would use that to rig the system to their advantage.

    Smith also recognized the ability of ‘projectors’ (speculators and precursors of arbitrage and hedge funds) to trigger financial panics, and recommended that the financial markets be regulated. And regulated to a degree that would be completely unacceptable to centrist Democrats and Republicans (for example, usury laws, and regulated interest rates).

  72. 72
    catclub says:

    @Violet: It is either 2000% more (twenty times as much) or maybe 5000% more, (fifty times as much).

    You wrote 200% more (three times as much), maybe you meant 200x more?

  73. 73
    Elizabelle says:

    I knew this story was Balloon Juice bait the minute I saw it.

  74. 74

    @fasteddie9318: Extreme inequality is the problem

    I’m still not sure that’s it. As the rest of your comment indicates, it’s not really the distance between the floor and the ceiling, it’s the question of whether the floor is under water.

  75. 75
    jl says:

    @70 randiego

    Yeah, right on time. The ink is barely dry on the signature. This misleading GOP attack on the Democrats for trying harming social insurance programs is about as surprising as sunrise at dawn.

  76. 76
    Linnaeus says:

    @Mike Goetz:

    The issue really isn’t inequality as such. As long as everybody has a decent and livable basis, I don’t care if some people have more. You can get where you are going in a no-frills sedan; who cares if a few people get a Mercedes.

    The key, though, is to make sure that those who have more don’t have so much more that they can distort democratic governance and rig the game in their favor. In that sense, inequality qua inequality is a problem in a capitalist society that also aims to be democratic.

  77. 77
    fasteddie9318 says:

    @Cris (without an H): The distance between the ceiling and the floor can only get so big before the floor must necessarily be under water.

  78. 78
    PurpleGirl says:

    @The Snarxist Formerly Known As Kryptik: Even collectively the rich spending freely does not produce the same economic power as 14 million or 200 million people spending on life’s necessities. The US experienced the best conditions during the 1950s and 1960s as the middle class GREW and spent. We know that happens. The rich have had much more spending power from Bush’s tax cuts in 2001 and 2003 and yet they haven’t produced much broad economic activity.

    I’m always amazed by the breadth of points you can find in 1776: To wit, the Dickinson character on being a property holder, which speaks to our middle class’ timidity in opposing the uber rich — But don’t forget that most men without property would rather protect the possibility of becoming rich, than face the reality of being poor.

  79. 79
    wrb says:

    @jl:

    It was Smith in particular of whom I was thinking when I said that our current system isn’t capitalist.

    He would be appalled at the things for which people now argue under the banner of capitalism.

  80. 80

    @Stillwater: This may not go over well in these pro-Krugman ranks, but one of the big problems our economy faces is neoliberalism and continued offshoring.

    I must not be much of a reader, because I don’t remember seeing a whole lot of support for offshoring in these virtual pages.

  81. 81
  82. 82
    Tuttle says:

    They’re going to call it class warfare anyways, so why not wage a real fucking class war already? They are!!!

  83. 83
    Villago Delenda Est says:

    @fasteddie9318:

    The thing is, collectively (there’s that word!) this country can afford a very solid basis for everyone living in it. A rational health care system, one that puts health care over profit, and doesn’t assume that shopping for a doctor is like shopping for a big screen TV, or any other consumer item, would be far less expensive than one that is structured as a wealth-redistribution system from patients to health care providers, and, even more importantly, to middlemen who skim off that wealth flow.

    It’s just that there are those amongst the overclass who cannot enjoy their fortune without knowing that others are suffering.

  84. 84
    Kane says:

    Americans tend to admire the wealthy. We marvel at the lifestyles of the rich and famous and their caviar dreams and champagne wishes.

    Most can accept the disparity of wealth, so long as everyone feels that they have a shot at opportunity and that there’s a promise through self-reliance and individual initiative that we can obtain a level of success.

    The problems tend to arise when the greed of those with the wealth and political influence seek to dismantle the very foundations in place that create the opportunities that are responsible for the middle class.

  85. 85
    Violet says:

    @catclub:
    Yes, you are correct. Thanks for the catch and correction. I meant x not %. Although even 200x is probably a low guess.

  86. 86

    A combination of direct voting for major policies and a strong push for states rights would have the twofold advantage of making it very hard for small groups of noisy extremists to hijack the policies of an entire state and would create evidence-based test cases for eventual federal policies.

    I direct your attention to California, the continued struggle over Prop 8 in particular. There you had both direct voting and small group of noisy extremist hijackers. That didn’t work out too well.

    America’s 50 states should become active policy laboratories and we should start using them in a search for fact based solutions.

    I live in a very blue state, but the thought of what they’d cook up in the labs in places like Florida or Texas makes my hair stand on end.

  87. 87
    PurpleGirl says:

    @Kane: We need a way to get across that no longer does anyone have an equal shot at becoming a member of the 1% club.

    See my comment above with the quote from 1776. (@78).

    Interesting thread and I can’t stay for it — I’ve got a dental appointment. Bleh.

  88. 88
    fasteddie9318 says:

    @Villago Delenda Est:

    It’s just that there are those amongst the overclass who cannot enjoy their fortune without knowing that others are suffering.

    Right; and those people have become so wealthy relative to everybody else that they can buy the political system and distort the marketplace in order to achieve their goal of maximizing (other people’s) suffering.

  89. 89
    Litlebritdifrnt says:

    @donnah: I sense an organized letter writing campaign here, cause a similar letter appeared in my local paper last week.

  90. 90
    Villago Delenda Est says:

    America’s 50 states should become active policy laboratories and we should start using them in a search for fact based solutions.

    Well, that will never work. Facts have a well known and documented liberal bias.

  91. 91
    fasteddie9318 says:

    @Thoughtful Black Co-Citizen:

    I live in a very blue state, but the thought of what they’d cook up in the labs in places like Florida or Texas makes my hair stand on end.

    Then the people in those states could either vote the maniacs out or go down with the Titanic. With a strong level of state autonomy (meaning fiscal as well as statutory, no more of this red state welfare crap), the citizens of Texas could all decide to self-immolate for all I care.

  92. 92
    fasteddie9318 says:

    @Cris (without an H):

    I must not be much of a reader, because I don’t remember seeing a whole lot of support for offshoring in these virtual pages.

    I assume the reference there was to Krugman’s “free” trade stance.

  93. 93
    Villago Delenda Est says:

    @fasteddie9318:

    The problem with “free” trade is it assumes that standards and practices are universal, and fails to take into account that economics is not just about numbers, it’s about culture, too, and that aspect of it eludes a lot of economists. You can see that problem even with Adam Smith, who makes some assumptions that just don’t hold up on closer examination about economic behaviors. There are cultural things that drive how people make economic decisions that can’t be very easily quantified, so they’re just ignored, as they get in the way of the glorious theory.

  94. 94
    Sly says:

    We’re so screwed.

    Of course we are. The central tenant of conservative economic orthodoxy is that a working stiff slogging through two (or more) jobs just to make ends meet isn’t quite desperate enough to warrant concern.

    The trick is to find the low-wage utopia sweet spot: the point on the spectrum at which wage earners are desperate enough to take increasing cuts to their standard of living because they have bills to pay, but not so desperate that they are willing to set a gated community on fire. For Americans, traditionally, that point is relatively low.

    Remember back in 2005, when Bush was doing his fake town halls on Social Security privatization? At one of them a woman was brought up to sit next to him; divorced mother of three, who was working three jobs just to make ends meet. When she finished talking, he asked her, “You work… three jobs?” Then he put on that smug, over-privileged idiot grin of his, turned to the audience and said, ver-fucking-batim, “Uniquely American, isn’t it? I mean, that is fantastic that you’re doing that.”

    And the pre-screened audience applauded. It was conservatism’s most honest moment of the decade.

  95. 95

    @fasteddie9318: Yeah. Uh-huh. Too bad about the people who can’t vote due the a state’s disenfranchisement anti-voter fraud laws.

    And you know if the assholes really jack themsevles up the governors of those states will go to the Fed for cash and the Repugs will pass the “Assistance for ReaLAMEricans who Stuck Their Ass in a Crack” bill and some of our tax dollars will go to bail out another bunch of morons. No thanks.

  96. 96
    bobbie says:

    I was walking around the edge of Newport Harbor in Newport Rhode Island a month or so ago and could not believe how many fairly new 50′-60′ luxury sailboats there were tied up at docks. Obviously this is where some of the rich money goes. BTW: A good number of them had “Georgetown” printed on their transoms for their home ports. Figures.

  97. 97

    @fasteddie9318: I assume the reference there was to Krugman’s “free” trade stance.

    I assumed the same. What I really should have said, to be clearer, is that just because many frontpagers and commenters look to Krugman as a voice of reason and link to him with approval, doesn’t mean we agree with him on absolutely everything. Stillwater was passively buying into the myth that BJ is full of personality cultists, and it just doesn’t really ring true to me.

  98. 98
    fasteddie9318 says:

    @Thoughtful Black Co-Citizen:

    Yeah. Uh-huh. Too bad about the people who can’t vote due the a state’s disenfranchisement anti-voter fraud laws.

    Yep, it is too bad. How are those disenfranchise folks in, say, Texas, going to fare when the whole country is being run by Rick Perry instead of just their state? Better, somehow? Those who can leave can leave; those who can’t, well, my idea doesn’t do anything to make them worse off than they already are.

    And you know if the assholes really jack themsevles up the governors of those states will go to the Fed for cash and the Repugs will pass the “Assistance for ReaLAMEricans who Stuck Their Ass in a Crack” bill and some of our tax dollars will go to bail out another bunch of morons.

    Well, yeah, you got me there.

  99. 99
    wrb says:

    Seems to me that the fear of being accused of class warfare has resulted in much less effective framing than is possible.

    For example, it is a lot easier to sympathize with the rich when you don’t see a very direct benefit from the cost being imposed on them.

    How about something like this:

    The Income Tax Relief Act of 2011
    Abolishes of all tax on the first $200,000 of income without raising our nation’s debt. Paid for thorough a inheritance tax on amounts over $2,000,000.

  100. 100
    jwb says:

    @Xenos: The smart money would ask why those Saudi princes are investing in Murdoch. They could get a significantly better return on their money elsewhere. So what is Murdoch delivering for them?

  101. 101
    mpbruss says:

    I don’t know if I coined this (nothing is new, so probably not), but re: hatred of the poor, this is my mantra:

    “Hatred of the poor is an American value.”

  102. 102
    Stillwater says:

    @fasteddie9318: @Cris (without an H):

    Yes, fasteddie got it right. Krugman is a staunch neoliberal wrt trade policy. I was pointing out that the economic problems a stimulus is intended to correct were to a significant degree created by the open trade policies he endorses.

  103. 103
    Paul in KY says:

    @Omnes Omnibus: Plus he lived in the Middle Ages…

  104. 104
    Judas Escargot says:

    @kt:

    For example: If submitted to a direct vote, drug reimportation would likely pass in most states and with a year or so of actual data to work with, it could be kicked up to the federal level giving Congress and the Senate real facts to work with rather than ideological or drug company spin.

    …the Roberts court then squishes all those people-friendly state laws using the interstate commerce clause. Squish, squish, 50 times over if needed. (Dying to see what they do with Vermont’s new health care law, should that ever get up to them).

    Not disagreeing with your main point, BTW, I’ve been a big fan of re-federalization since the Bush years. But as with same-sex unions, drug decriminalization, etc, the rightwingers are all for State’s Rights… until they’re not.

  105. 105

    @Stillwater: Point taken, and well said. I’m just saying, don’t worry about pointing that out in “pro-Krugman ranks.”

  106. 106
    TenguPhule says:

    can we talk about solutions, and how to achieve them?

    Dead republicans and headsman axe for $1000.

  107. 107
    SiubhanDuinne says:

    @Villago Delenda Est:

    I’m thinking of starting a line of luxury tumbrels. First-class all the way to the guillotine.

  108. 108

    […] Cole lays out the case that luxury goods (like $9,000 Chanel sequined tweed coats) are flying off luxury store shelves and […]

  109. 109
    Quiddity says:

    Meanwhile, more Americans are cutting back their spending at dollar stores.

    SLATE: When Dollar Stores Are Too Expensive

  110. 110
    Mike G says:

    “If you are on any public assistance, you lose your right to vote. How can we expect someone to have a logical say when that’s how they are surviving? If you want to live off others, they should be deciding how much and when.”

    That’s not a bad idea. Everyone on Medicare and Social Security gets kicked off the voter rolls, that would wipe off 80% of the teatard voter base.

    Drop from the rolls everyone getting veterans’ benefits or farm subsidies, and everyone living in the red welfare states that don’t pay their freight in federal taxes. We’d have a progressive congress in short order.

    It seems like the most vocal anti-government activists are those whose entire lifestyle is underwritten by taxpayers’ money. Rightards suckle heavily at the ‘government teat’ while pretending they’re all as self-sufficient as Clint Eastwood in High Plains Drifter. Lack of self-awareness is a prerequisite for their mentally-ill politics.

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