Thursday, October 8, 2015

Why Hasn't Democracy Slowed Inequality?

Inequality has been rising in the US much faster than it has in most advanced economies.  One would think the electoral process would reverse this trend.  This article shows that the share of campaign contributions to both political parties from wealthy donors has been rising rapidly over the last few decades.  That has made both parties more responsive to the needs of wealthy supporters.  That effect is amplified by the rising costs of political campaigns.  It costs much more to run an effective campaign and most of the money comes from wealthy donors.  Consequently, both parties are more attentive to the needs of the wealthy.  On economic issues there is less difference between the two parties than there is on social and cultural values.  The Democratic Party has been more successful among wealthier and better educated voters than the Republican Party.  The Republican primary campaign illustrates the dependence of the Party on voters who reject the liberal social values that they attribute to Democrats.  Many minorities are also turned off by the more liberal social values that they associate with the Democratic Party.  On the other hand, they value many of the social welfare programs that are more strongly supported by the Democrats.  Comments made by several GOP candidates have made it more difficult for them to appeal to minorities who may share some of their social values.

The bottom line is that democratic forces have done little to slow down the rise in income inequality. It is less of an issue in political campaigns than social and cultural values. We are faced with two bad alternatives.  The country is difficult to manage with a Republican Congress and a Democratic Administration.  Our worse nightmare would be a Republican Congress joined by a Republican President.

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