Monday, October 15, 2012
Why Are Conservatives In Rich Nations Beating The Drums Against Social Welfare Spending?
Robert Gordon has raised several questions about the future of economic growth in the developed economies. His arguments are presented in this article. There are also prior posts on this blog that deal with Gordan's argument. The claim in this article is that conservatives agree with Gordan's analysis. They anticipate the lower rate of growth that he forecasts, and they fear the implications. The public will demand more support from governments in rich countries to counteract stagnant, or decreasing wage growth. That is why they are promoting tax cuts for the wealthy, and using the resulting deficits as an argument against social spending. They want to dampen the demand for social welfare before it begins to heat up. This also explains the fervor and emotions that conservatives like Mitt Romney and Paul Ryan display on the campaign trail. The super rich want a bigger slice of shrinking pie. Progressives in rich countries may also understand what is likely to happen to economic growth. They can't make the impassioned arguments that conservatives make against social welfare programs, and they can't really tell the public that economic forces are underway which government is unable or unwilling to moderate.