Magazine article Modern Age

Conservatism and the Real Problems of Income Inequality

Magazine article Modern Age

Conservatism and the Real Problems of Income Inequality

Article excerpt

Since the recession that began in 2008, the issue of income inequality has been a central tool of political strategizing. Progressives have used the issue as a sword against conservatives, accusing the latter not only of indifference toward the plight of working Americans but of actually welcoming the widening gulf between rich and poor, as if conservatives want nothing more than to see the wealthy become wealthier, even if it is at the expense of the poor. At the same time, however, conservatives have shied away from the issue, perhaps afraid of how the issue might feed the big-government agenda of liberalism.

Even though they have had a sympathetic ear in the White House for fifteen of the past twenty-three years, progressives have used the inequality issue to put conservatives on the defensive, blaming them for the failure of the middle and working classes to match the progress made by the upper income groups. This assault against conservatives has been deceptive and distorted, but at the same time conservatives have often retreated by trying to dismiss the extent of the widening income gap.

The inequality issue is not the simple problem the left makes it out to be. The left argues that inequality is the cause of all other economic woes, specifically a diminishing upward mobility. But in reality, it is just the other way around. Inequality is less a cause than a symptom of our economic woes. The widening income disparity is a result of diminishing upward mobility, which in turn is the result of various technological, globalization, and governmental policy factors. For progressives to ignore these factors and focus only on taxing the rich is to disregard all the obstacles facing upward mobility, including the left's own misguided policies.

The public is right to worry about wage stagnation and economic mobility, as well as the rising costs of education, health care, and raising a family. But all these problems are not simply the result of income inequality. If anything, inequality is a reflection of these problems. Therefore, conservatives must address the actual mobility problems being felt by working and middle class Americans through, for example, lowering the cost of higher education, improving secondary education, and easing the cost of raising a family through expanding the child tax credit. Conservatives must seize inequality as their issue, not only because of the failed policies of the left but also because it is a problem that goes to the heart of the conservative vision of society. It is an issue that must be addressed if conservatives are to provide a workable governing vision that can be embraced by all of society.

Given the wage stagnation and weak employment gains of recent years, it is not surprising that many economists claim that the gap between rich and poor is at its widest since records began forty-five years ago. This gap widened even throughout the recovery. From 2010 to 2013, only the households at the very top of the income ladder saw gains, while families in the bottom 40 percent saw their incomes decline over that period, according to the Federal Reserve. Meanwhile, household incomes in the middle stagnated.

The real incomes of the poorest fifth of Americans, which began their decline during the Bush administration, have continued to decline even throughout the economic recovery from the 2008 recession. Although the wealthiest Americans have seen substantial gains since the 2008 recession, the poverty rate remains two full percentage points above what it was in 2007, and more than three percentage points above what it was in 2000. If the rate today were what it was in 2000, ten million fewer Americans would be living in poverty.

Not only has the middle class experienced wage stagnation, but the supply of midwage jobs has shrunk proportionally more than jobs at the top or bottom. A polarization or hollowing out of the labor market has eliminated many of the jobs traditionally available to the middle class. …

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