Unequal Democracy: The Political Economy of the New Gilded Age

THE PARTISAN PATTERN of economic performance documented in chapter 2 raises a perplexing political question. Real income growth has historically been much stronger under Democratic presidents than under Republican presidents, especially for middle-class and poor people. So why do so many people—including middle-class and poor people—persist in voting for Republicans? After all, Republican candidates have won most of the presidential elections of the post-war era, including five of the last seven. If we imagine that voters want, or should want, to use their power at the ballot box to advance their own economic fortunes or those of their fellow citizens, something seems fundamentally amiss here.

The implications of this anomaly for economic inequality should be clear from figure 2.5, which suggests that the marked escalation of inequality over the second half of the post-war era would simply not have occurred under a steady diet of Democratic presidents and policies. Thus, the ability of Republicans to thrive in the electoral arena despite the negative impact of their policies on the economic fortunes of middle-class and poor people must loom large in any convincing account of the political economy of the New Gilded Age.

In chapter 4, I offer a novel explanation for the striking electoral success of Republican presidential candidates in the post-war era. However, in this chapter I first pause to consider a more straightforward explanation—that voters care about many other things besides income. Perhaps they prefer Republican positions on cultural issues, race, or foreign policy, and consciously accept lower income growth in order to get their preferred policies in these other domains. In that case, the apparent frustration of the economic interests of middle-class and poor people simply reflects the secondary status of economic issues on the contemporary political agenda—and the inevitable fact that voters in a two-party system must sometimes sacrifice secondary concerns in order to support candidates who share their views on the issues they care about most.¹

¹ This formulation begs the second-order question of why Democratic candidates do
not simply mimic popular Republican positions on these other issues and then coast to victory
on the strength of superior economic management. One possibility is that they are politi-
cally incompetent or wrong-headed. A more systematic explanation, investigated by political econ-
omist John Roemer, is that intraparty conflict between ideologues and opportunists produces

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