Tag Archives: inequality

The GOP’s Class Divide on Austerity

As the 2016 election intensifies, one of the frequently discussed political fissures is that between the wealthy elites in each of the major parties and their bases. David Frum and other pundits have argued that the divide is most stark for the GOP, but no one has yet brought data to the question. So I used a mass survey that is performed each election year and that includes questions about austerity policies to examine the divide between wealthy and low-income Republicans and Democrats. I found striking results.

I drew from the 2012 Cooperative Congressional Election Study, a survey with a large sample size of more than 50,000. (Of those, nearly 22,000 Democrats and 17,000 Republicans both reported their income and responded to a battery of questions related to the federal budget.) Many surveys stop dividing respondents by annual income after they reach $100,000, a practice known as top coding, but CCES includes a meaningful sample of respondents all the way up to $350,000. As a result, the data allow for a more granular examination of those at the highest levels of the economic ladder.

I examined support for three policies that relate closely to redistribution and inequality: the 2010 Bowles-Simpson bipartisan plan for deficit reduction; Representative Paul Ryan’s budget proposal for FY2012, which he put forward as the GOP’s “Roadmap” to a fiscally sound future; and extension of George W. Bush’s tax cuts. Each of these policies has the potential to divide the donor class and the base of each party, as they all involve key questions about redistribution, where the deepest class divides typically appear.

In the survey, each policy was explained to participants, who were then asked if they supported or opposed it. The data do in fact reveal deep class divides within the parties on redistributive issues, but particularly within the GOP.

THE RYAN BUDGET

Polling explanation: “The Budget plan would cut Medicare and Medicaid by 42%. Would reduce debt by 16% by 2020.”

Among all respondents in both parties, only 20 percent supported the budget, making it incredibly unpopular. Among Democrats, opposition was universal: Only 11 percent supported it. Among Republicans, support was equally tepid: Only a third of all Republicans supported the Ryan budget.

However, when looking at responses by income on the Republican side, wide gaps emerge. Among Republicans earning less than $50,000, only a quarter of respondents supported the budget, while among Republicans earning more than $350,000, a full 64 percent supported it.

THE BOWLES-SIMPSON PLAN

Polling explanation: “Plan would make 15% cuts across the board in Social Security, Medicare, Medicaid, and Defense, as well as other programs. Eliminate many tax breaks for individuals and corporations. Would reduce debt by 21% by 2020.”

Bowles-Simpson was hailed by centrist commentators as an ideal budget agreement, which would combine tax cuts and defense cuts with deep cuts to Social Security, Medicare, and Medicaid. However, more liberal critics, like economist Paul Krugman, argued that the deep cuts to safety-net programs would harm seniors and weaken growth.

In the survey, support was split directly down the middle among all respondents, with 50 percent in support and opposed. Indeed, even within parties, there was surprisingly little divide, with 49 percent of Democrats in support and 51 percent opposed, compared with 52 percent of Republicans in support and 48 percent opposed. However, there were once again deep class divides, this time in both parties.

Among Republicans earning less than $50,000, 47 percent supported Bowles-Simpson, and among Democrats, 44 percent supported the plan. However, among Republicans earning more than $350,000, 64 percent supported the plan, as did 66 percent of high-income Democrats. The sample of individuals earning more than $500,000 is small, but among that group, two-thirds of both Democrats and Republicans supported the policy.

THE TAX HIKE PREVENTION ACT

Polling explanation: “Would extend Bush-era tax cuts for all individuals, regardless of income. Would increase the budget deficit by an estimated $405 billion.”

The Bush tax cuts were unpopular with both Democrats (only 13 percent support full extension) and Republicans (42 percent support full extension). However, among Republicans making less than $50,000 a year, only 37 percent supported full extension of the Bush tax cuts. Meanwhile, among those making more than $350,000 a year, a full 73 percent supported it.

Another questions asked survey participants about partial extension of the Bush tax cuts, in the form of the Middle Class Tax Cut Act, which would have extended Bush tax cuts for those with incomes below $200,000 and increased the budget deficit by an estimated $250 billion. Among Republicans who earn less than $200,000—those who would benefit from the bill—61 percent supported the extension. Among those who earned $200,000 or more, only 48 percent did. Among the highest earners, those making $350,000 or more, support dropped further, to only 43 percent.

These data also suggest that there are deep class divides not just between the parties but within them. Though the divides are deeper on the right, they exist in both parties. This can partially be explained by the fact that many white voters who are broadly supportive of safety-net programs are nonetheless pushed toward right-wing candidates by racial resentment. As the wealthy accrue more influence in the post–Citizens United world, these divides may become more powerful, particularly since leading GOP candidates have largely submitted to the demands of the donor class on taxes. On the other side, there are important divides in the Democratic coalition between those who prioritize deficit reduction and those who want looser fiscal policy. These class divides will become increasingly important as inequality becomes an increasingly focal point in American politics.

This piece originally appeared on The Nation. 

To Influence Policy, You Have to Be More than Rich

It’s a common refrain — politicians don’t listen to everyday Americans. But is that really true? And if so, whom do they listen to? Last year, two political scientists, Martin Gilens and Benjamin Page, attempted to answer that question in abombshell paper that suggested “America’s claims to being a democratic society are seriously threatened.”

The paper was widely lauded in the press culminating in an appearance on The Daily Show. But that fame came with misinterpretations of their research in attention-grabbing headlines painting their findings as nearly dystopian. Heath Brown, a political scientist at the CUNY Graduate Center, tells me, “Despite the assertion of certain headline writers, concluding that Gilens and Page demonstrated that we live in an oligarchy is not true to what they themselves claim nor the key findings of the research.” The paper’s popularity, along with these misinterpretations, lead to a wave of other research that has enriched the debate.

In their paper, Gilens and Page use a dataset Gilens compiled for his 2012 book,Affluence and Influence, which includes 1,779 policy cases between 1981 and 2002 as well as poll data measuring citizens’ preferences regarding those policies. They used the responses of the poorest 10 percent as the poor, median income individuals to represent average voters and the preferences of the richest 10 percent as a proxy for “economic elites.” They also compiled the policy preferences of interest groups like the NRA and Chamber of Commerce. They then compared the preferences of individuals across the economic spectrum to actual political outcomes. When they ran the preferences of each group separately, as the sole predictor of policy change, they found strong congruence with the policy preferences of average citizens, elites and interest groups and outcomes (though the elite group had the strongest congruence). However, when they ran the model with all the preferences combined, they found that the preferences of the middle class no longer predicted effects on outcomes. They report that when the preferences of ordinary Americans and elites differ, “economic elites and organized groups representing business interests have substantial independent impacts on U.S. government policy, while mass-based interest groups and average citizens have little or no independent influence.” In short, the rich get what they want. This analysis adds on the original analysis that Gilens did in his book, which was slightly different. There, he examined how representation shifted as preference gaps increased (the preference gap is the percentage point difference in the share of each class supporting the policy). He found that on issues where preference gaps were low (a less than 5 point difference between the percentage of the rich and middle class or poor opposed), representation was equal. However, as preference gaps increased, policymakers favored the rich. Combined, the book and the paper make a strong case for inequality of representation.

A more nuanced portrayal of this research, along with a survey of points made by its critics, suggests that frequently the views of the middle class and rich coincide closely. Thanks to party politics and a general bias toward the status quo, the policy preferences of Americans from all walks of life tend to converge. The data also reveal that the rich have an important ability to veto possible change. Instead, it’s the uber-rich, especially the subset who donate heavily to political campaigns and causes, who along with corporate lobbyists hold far greater sway than everyday voters in influencing government policymaking.

Democracy By Coincidence?
The core critique of Page and Gilens’ work is that the policy preferences of wealthy voters don’t actually differ that greatly from those of other voter classes (something they note in their paper, but which was almost entirely ignored in the media flurry). Further, critics argue that when the preferences do differ, it’s not clear that the rich are always the winners.

Take a yet-to-be published article by political scientists J. Alexander Branham, Stuart Soroka and Christopher Wlezien: “the rich and middle agree more than 90 percent of the time; when they disagree, the rich win only a little more often than the middle.” These authors wanted to examine specifically the issues in which there were clear class differences in policy. Rather than using a model or preference gaps, they examined issues in which there were clear divides in opinion: in which a majority of the wealthy favored one policy and the middle class or poor opposed it. This method certainly has advantages, but as Gilens notes in Affluence and Influence, because of status quo bias, there is a difference between a policy supported by 51% of a group and 75% of the group.

Among the full sample of policies, Branham, Soroka, and Wlezien examine majority support and opposition. They find that in the case of 1,594 policies (or 90% of the sample) the rich and middle class agree. There are 616 policies that both groups oppose and 978 that both groups favor. That leaves 185 policies that the rich and middle are split on. On 78 policies, the middle favor the policy and the rich do not, on the other 107, the rich favor but the middle do not. Here, the average gap in support is 10.9 percentage points on average. When examining only policies where there are opposed majorities, the “win rate,” or share of times the group has its preferences enacted are similar (though the rich are still advantaged). The authors also note that the poor do suffer slightly lower representation than other groups (policies they favor and other groups dislike are the least likely to pass). On the whole, however, they find representation is relatively equal when examining majority support (see the table below, Table 3 in their paper). They also find that wins for the rich and middle class do not break down easily ideologically, though the rich are slightly more likely to block left-leaning policies than conservative ones.

Another critique comes from Cornell political scientist Peter Enns, who proposesrelative policy support as an important metric: policies must be considered not independently, but relative to other policies. Imagine a scenario in which 60% of the rich supported a higher minimum wage and 70% of the middle class did, but 90% of the rich and 80% of the middle class supported a government health insurance program for children. Enns argues that, regardless of who the government was representing, both the middle class and rich would prefer a government health insurance program for children to a higher minimum wage. In this case, he argues that coincidental representation is occurring.

Charts help illustrate his case. The chart (below, Figure 5 in his paper) shows the high correlation between those at the median and those in the 90th percentile with the hollow dots representing the (large majority) of cases in which preference gaps are lower than 10 points. Of the full sample, there are only 322 policies in which there is a more than 10 point gap between the rich and middle class (there are 747 polices with a more than ten point gap between the rich and poor). Because of this, the possibilities for relative policy support are quite large. In his criticism, Enns writes, that because of similar patterns of relative policy support, “Even if policy only responds to the wealthy… we should expect that policy ends up about where those in the middle would expect if they received the same representation as affluent individuals.”

The most recent criticism, from Ph.D. student Omar Bashir, argues, “that average Americans have received their preferred policy outcome roughly as often as elites have when the two groups have disagreed with each other.” He argues that because of the incredibly high correlation between the preferences of the middle and the wealthy, the model that Gilens and Page constructed makes it difficult to discern patterns of representation. (As of publication, Gilens maintains that Bashir’s analysis contains methodological flaws, telling me, “the central claims he draws from is simulation are not supported”). Enns tells me that while scholars often disagree on the most appropriate analytical approach, Bashir’s approach appears defensible to him.

The authors often employ different methods of determining the similarity of preferences, which is important because American policy is strongly biased towards the status quo, and it often requires more than a simple majority to produce change. For instance, in the cases of a narrow pro-change majority, the policy preference of the public was adopted only 30% of the time. Even in cases of overwhelmingly majority support (80%) among the public, the policy change was only achieved 43% of the time (see chart below, Figure 3.2 in his book). This almost certainly helps explain why the middle class has little independent influence.

Gilens notes that if one examines issues on which 75% or more of the middle class support a policy (or 75% or more oppose it) and a 10-point preference gap, the middle class have a lower success rate than the rich. Only 34% of the time that that three-quarters of the middle class express a policy preference (and there is a 10 point gap with the rich) is neither policy preference enacted, compared with 66% of the time for the rich. Gilens writes that, “affluent Americans do not always get the policies they prefer either. But the affluent are twice as likely to see the policies they strongly favor adopted (46% compared with 19%), while the policies they strongly oppose are only one-fifth as likely to be adopted as those that are strongly opposed by the middle class (6% compared to 32%).” Further, Gilens notes that issues regarding redistribution are among those with the most intense disagreement between the rich and poor, and on these issues the rich win the most.

Enns responds that these policies (in which three quarters of the middle class have a preference and there is a 10 point gap compared to the rich) make about 5% of the sample. However, many of these questions are important questions about redistribution. Using data compiled by political scientist Matt Grossman, the chart below shows the areas with the biggest gaps between the median income and the top decile. It shows that key questions of redistribution are frequently fraught, with the median far more supportive of higher taxes on the rich and other redistributive policies.

Gilens also notes that even focusing on majoritarian preferences, gaps arise. In cases where both the rich and middle class agree, if the rich have greater support, the policy is more likely to pass (44% compared with 35%). This aligns with the analysis contained in Gilens’s original book, in which he shows that as preference gaps increase, the affluent become more likely to win compared to the middle class. In addition, the rich have an important veto power: among policies that both the middle class and rich oppose, when rich opposition was greater, only 17% of the policies passed. When middle class opposition was greater 28% of the policies passed. Indeed, a second look at their third table suggests the rich have a powerful veto power: only 20% of the policies favored by the middle and poor (but opposed by the rich) passed, compared with 39% of the policies that the rich favor and the middle and poor oppose.

Thus, though different methods reduce representational inequality, they do not eliminate it. Further, analysis suggests there is evidence that policymakers respond to the preferences of the middle-class and poor, though unequally. The question at the core of Gilens and Page is whether middle class and low-income people have independent influence on policy, rather than simply their preferences being congruent with outcomes. As Gilens writes, “coincidental representation is a pale, counterfeit, simulacrum of democracy.”

The corollary of this argument is that parties may matter more than income. In a 2013 paper, economists Eric Brunner, Stephen Ross, and Ebonya Washington argue that, “Differences in representation by income are largely explained by the correlation between constituent income and party affiliation.” A working paper by political scientist Chris Tausanovitch argues, “In recent years, representation occurs primarily through the selection of a legislator from the appropriate party.” In his paper, Enns argues that, “Although scholars have increasingly focused on the lack of responsiveness to middle-income Americans, it may be that partisan divisions matter most for policy outcomes.”

While this is an important point, but it’s not entirely clear that it undermines Gilens and Page. For one, parties in America are strongly divided by class but with a key caveat: while Republicans expertly represent the interests of the very rich, it’s not clear that Democrats do a superb job of representing the working class. But further, a working paper (discussed here) by political scientists Jesse Rhodes and Brian Schaffner finds that, Republican members of Congress are “more strongly associated with the ideological predispositions of individuals in higher wealth brackets,” while Democrats are less strongly associated with millionaires. However, they also find that, “millionaires receive about twice as much representation when they comprise just 5% of the district’s population than the poorest wealth group does when it makes up 50% of the district.” Their work therefore suggests that differential representation is mediated by parties, but parties can’t explain everything.

The Donors And The Lobbyists
One limitation of the current literature is that many studies don’t pay special attention to the ultra wealthy (the .1% and .01%), and particularly the donor class (whose views are disproportionately represented), instead grouping them in with the merely affluent (those in the top 10 percentile). There is good reason to believe that the wealthiest of the wealthy have views that are far from the general public,particularly regarding redistribution. In addition, there are reasons to believe the donor class, which is a unique subset of the wealthy, have differing views from both the general public and other wealthy people. Political scientist Michael Barber sent out a survey to donors who had given more than $200 to the 2012 Presidential campaign and around 2,870 responded. While 69% of Americans have a net worth below $250,000, only 8% of those in his sample did (18% of this sample had a net worth over $10 million – the threshold to be in the top 1% in 2012 was $8.4 million). He finds differences between donors and non-donors of the same party, with donors holding more extreme positions than voters. He also finds, not surprisingly, that politicians are more responsive to donors than co-partisans, individuals who voted for them, and voters in their state. In a 2010 study three scholars, Brittany H. Bramlett, James G. Gimpel, and Frances E. Lee find thatneighborhoods with high-concentrations of donors have preferences that differ from the rest of the nation. They write, “Even after accounting for their higher income and education, Democratic residents of high-donor areas are far more supportive of free trade and less concerned with job losses resulting from foreign competition than is typical for members of their party.” Political scientists Peter Francia, John Green, Paul Herrnson, Lynda Powell, and Clyde Wilcox find thatRepublican and Democratic donors are distinct from their bases, tending to be more ideologically extreme. They find that New Democrats, a significant part of the Democratic donors class actually had a more favorable view of the Chamber of Commerce than the AFL-CIO. On the other side of the aisle, “Large majorities of Republican donors belong to business organizations and support fiscally conservative economic policies.” A study of CCES data by political scientists Nolan McCarty and Didi Kuo finds “very substantial differences between donors and non-donors across a variety of issues. Not surprisingly, donors are considerably more conservative on economic policy.”

In addition, we may need to put greater emphasis on the influence of highly mobilized constituencies, like business groups, and how they distort the policy process. These groups tend to be the most out of line with the general public, and also to have the most clout when it comes to changing policy. It’s worth noting an important finding of the Page and Gilens’s paper that was largely buried during the press deluge: the biggest divergence in preferences was not between the rich and the poor, but rather all Americans and corporations and their lobbyists. It’s important to begin examining how income and power influences not just who wins when an issue comes to the roll call, but rather what determines which issues are discussed.

Finally, scholars should further examine how race and gender interact with income and representation. Studies suggest that low-income black women, for example, are particularly likely to be ignored by policymakers. The fact that donors tend to bewhite, male, and rich has profound implications for representation in a political system that is driven by donors.

The critics of Gilens and Page make a key point: because of high levels of congruence between the rich and middle class, when policymakers respond to the rich, they frequently enact the policy preferences of average Americans. However, full accounting of the evidence leaves the core finding of Gilens and Page standing: the views of the wealthy are disproportionately represented by policymakers, and representation for low and middle income Americans primarily comes from their congruence with the wealthy. It also includes the reality that policies opposed by the rich are far more likely to have the policies they dislike fail.

We must discuss how political information is mediated through social networks and the importance of working class mobilization. We must focus on the overwhelmingly white, male, and wealthy donor class, and the dynamics of race and representation. The influence of the Koch Brothers and other billionaire donors certainly pulls our politics to the right. Finally, we must consider overwhelmingly powerful business groups which spend heavily on campaign contributions and lobbying. The solutions to these problems are many, but disclosure and public financing are the most potent tools available given the current makeup of the Supreme Court. By empowering small donors, and bringing non-donors into the system, such a system could limit the power of big donors. Another solution would be building up legislative and research capacity for Congress, so they are less dependent on lobbyists. Research at the state level suggests that professionalized legislatures are more responsive to their constituents and less likely to pass model bills pushed by outside organizations like ALEC. Such a system could be structured to also give money to parties, a bulwark against private interests. In addition, progressives should see higher voter turnout as a way to disempower the donor class. A policy combination of automatic voter registration, universal vote by mail, campaign donations disclosure and public financing would be a strong anti-plutocracy agenda. But it’s only a start.

This piece originally appeared on Washington Monthly. 

The wealthy are ruining American health care

This piece was co-written with Vijay Das, a healthcare advocate at Public Citizen. 

In a hard-hitting New York Times op-ed on Friday, senior New York Democratic Rep. Steve Israel put all of Washington on notice. He is fed up with campaign fundraising. He joins Sen. Barbara Mikulski, D-Md., this year and Sen. Tim Johnson, D-S.D., last year in retiring from Congress. They’ve had enough of shaking down America’s superrich.

Corporate lobbyists and wealthy activists dictate much of American politics today. In the 2012 presidential race, 0.01 percent of Americans contributed almost 30 percent of the money spent in that entire election cycle. Corporations spend billions of dollars annually on lobbying. America’s big spenders exert tremendous influence over elected leaders and have dramatically different priorities from everyday citizens’.

Nowhere is that clearer than in the political battle over the Affordable Care Act’s Medicaid expansion, which exemplifies how very wealthy political donors impair access to health care.

The law raised the income threshold for low-income Americans to qualify for Medicaid. Households with income up to 138 percent of the federal poverty line are eligible. However, the Supreme Court ruled this provision optional for states. For states that expand Medicaid, the federal government picks up all costs to cover additional Medicaid populations until 2017. States pick up 5 and then 10 percent of the tab thereafter. Twenty states have failed to expand Medicaid, leaving 3.1 million Americans uninsured. With a new executive order in Louisiana, the number will fall to 19 states, and an additional 200,000 Americans will eventually become insured.

Medicaid expansion is vital. If it were expanded in every state, it could have prevented 7,115 to 17,104 unnecessary deaths and 240,700 racked-up catastrophic medical bills each year.

Expansion also saves money. With it, states could spend far less on uncompensated emergency care. If Pennsylvania alone expanded Medicaid coverage, Rand Corp. economist Carter Price found that it could add $3 billion to the state’s GDP and create 35,000 jobs.

Yet expansion is being held up because of politics. New research shows that Charles Koch and David Koch’s advocacy group Americans for Prosperity is having great success blocking state Medicaid expansion. The organization’s 34 state chapters currently spend large sums to build its grass-roots advocacy and place political ads. It’s paying off in Florida, where Gov. Rick Scott has all but retreated on his openness to expand Medicaid to cover 567,000 low-income Floridians.

This trend is unfortunate, because there’s fertile ground for Medicaid expansion nationwide. New research suggestsif public health activists could better mobilize, they could pressure lawmakers to expand Medicaid. Citizen advocates can trump the austerity-first agendas of billionaire-financed interest groups. They simply have to organize better.

The priorities of rich donors are out of line with voters. Brian Schaffner’s analysis from the 2014 cooperative congressional election study shows a large gap in opinion about Medicaid expansion between the average GOP supporters and the richest among them. Sixty-two percent of nondonor Republicans surveyed said they would refuse the Medicaid expansion, compared with 77 percent of donors who gave much more than $1,000.

AJAMHeatlhcare1Medicaid expansion aside, the political influence of the extremely rich undercuts American health care.

A study of wealthy Americans by political scientists Benjamin Page, Larry Bartels and Jason Seawright finds that while average Americans favor national health insurance, which would be publicly financed on the basis of one’s ability to pay, only 32 percent of the wealthy surveyed said they support the policy, compared with 61 percent of all Americans. When asked if average Americans were willing to “pay more taxes in order to provide health coverage for everyone,” 41 percent of the rich said yes, compared with 59 percent of the general public.

AJAMHeatlhcare2

Donations from the wealthy and corporate contributions for lobbyists have also resulted in attacks on Medicare, the half-century-old national health insurance program for seniors and people with special needs. Raising Medicare’s eligibility age from 65 to 67 is a frequency cited idea among the current crop of Republican presidential candidates, even though it would dramatically curb health access for seniors. It’s not crazy to expect House Speaker Paul Ryan to sneak it into this year’s budget. President Barack Obama even offered it as part of a large budget deal in 2011.

This policy would force people off their health coverage, particularly in states that have not expanded Medicaid. An estimated 435,000 seniors would lose coverage by 2021 if the eligibility age were raised. If the eligibility age had been raised in 2014, seniors would have had to pay $3.7 billion more in out-of-pocket costs that year, preventing many of them from obtaining necessary treatments.

Most troubling is that this proposal would increase overall health care spending. Medicare is much better at controlling costs than private insurance, and it has lower administrative costs. Individuals kicked off Medicare likely would get private coverage, and their health care bills would add to overall U.S. health care spending. Thus any Medicare savings achieved by increasing the eligibility age would be canceled out. The Center for American Progress found that raising Medicare’s eligibility age would cost individuals, businesses and states twice as much as the federal savings suggested by the reform.

Though a large majority of Americans opposes raising the retirement age, it remains a fixture in health and federal budget discussions. Why? Because the policy has a powerful big money constituency in Washington. Most trade associations share the interests of their wealthy members: recklessly shrinking federal spending in the name of balancing the budget and eliminating tax obligations, no matter the consequences to the economy and public health.

Trade associations have outsize lobbying muscle. According to a seven-month analysis in 2014 by the Center for Public Integrity, nearly 85 percent of corporate donations for lobbying flowed to trade associations. For every dollar spent on lobbying on behalf of labor unions or citizen interests, corporations and their associations spend $34. Of the 100 organizations that spend the most on lobbying, 95 consistently represent business.

Lobbying to gut Medicare and Social Security is a long-standing problem. Since 1998, the top three health care industry groups have spent three times as much on lobbying as AARP. The Business Roundtable and the U.S. Chamber of Commerce are the biggest spenders year after year. Both advocate raising the Medicare eligibility age.

There are ways to improve and save Medicare that align with citizens’ interests. We could lower the Medicare age to boost its solvency and achieve better health outcomes. We could save Medicare billions of dollars by allowing it to negotiate the price of prescription drugs. We don’t have to slash benefits and curb access for our hard-working seniors.

As candidates parade around the nation rattling their cups at $40,000-a-plate fundraising dinners, the health of American democracy worsens. When industry-sponsored evening banquets blanket the first 100 days of the next president, we will all suffer.

Many solutions can address the concentrated role big money plays in our politics. Public funding of campaigns is one way to renew the people’s faith in our elections because it would create a more level playing field, allowing a wider range of candidates to compete. At a minimum, we should empower voters by mandating disclosure of all contributions.

The very rich’s austerity agendas are literally killing people. It’s imperative we take the required steps to restore confidence in our democracy.

This piece originally appeared on Al Jazeera America. 

Why hasn’t democracy reduced inequality?

More than a century ago, German scholar Werner Sombart published a book entitled “Warum gibt es in den Vereinigten Staaten keinen Sozialismus?” or, “Why Is There No Socialism in the United States?” Today, many scholars and political thinkers ask the same question, and the answers vary broadly. While many of the answers — racism, the malapportionment of the Senate, federalism, a pro-business Supreme Court, low levels of civic participation — all have some truth and explanatory power, it remains difficult nonetheless to square democracy and inequality. Democracy was supposed to be “the road to socialism,” after all.

Now a new study by Nicholas Stephanopoulos sheds light on why “democracy” hasn’t reduced inequality: Because it doesn’t exist.

Stephanopoulos used two sources for his analysis: first, the massive database of public opinion surveys covering 2,074 questions over a 25-year period (1981-2006) compiled by Martin Gilens for his book “Affluence and Influence;” second, he combined state level exit polls from between 2000 and 2010 with an index of state policy liberalism, thus allowing him to compare the preferences of different groups with the outcomes of policy. He controlled for group size by multiplying a group’s support for a policy by its share of the population. Like Gilens, Stephanopoulos only compared policies in which preferences between the two groups being studied differed by more than 10 points.

As shown in the charts below, Gilens’ dataset demonstrates convincingly that the preferences of women, people of color and those falling into low- and middle-income brackets have almost no effect on policy. A flat line indicates that policy preferences have no influence on policy, a downward-sloping line means that a group’s policy preferences have a negative impact on policy. An upward-sloping line indicates that a group’s preferences have a positive impact on policy — that is, they get what they want. This dataset is incredibly useful, because rather than examining broad ideological measures, it directly asks: Do the people get what they want?

The answer is: Yes, if they’re rich white men.

The negative line for women is particularly troublesome. For more than half of the United States population, supporting a policy actually means policymakers are less likely to pass it. As Stephanopoulos explains,

“As male support increases from 0 percent to 100 percent, the odds of policy enactment rise from about 0 percent to about 90 percent. But as female support varies over the same range, the likelihood of adoption falls from roughly 80 percent to roughly 10 percent. When men and women disagree, then, stronger female backing for a policy seems entirely futile.”

This is absolutely insane.

While the Gilens dataset only measures policy outputs at the federal level, the second dataset examines how opinions and policy correlate at the state level. The charts below document how the ideology of different groups interact with the ideology of state policy.

As you can see, whites and Latinos have positive and statistically significant influence on policy, while blacks do not. This means that if blacks in Mississippi are more liberal than blacks in Alabama, that won’t affect the relative policies of each state. And, once again, women have no influence on policy at all, nor do low-income people. Indeed, Stephanopoulos writes that “state policy liberalism actually decreases from about 1 (or roughly Ohio’s policy set) to about -1 (or roughly New Hampshire’s) as the ideology of those making less than $30,000 varies over the same range.” That is, poor people’s preferences are negatively correlated with policy in their state.

Much of what Stephanopoulos finds meshes with other research on the subject: Other studies (particularly the work of John Griffin and Brian Newman) find that people of color have divergent preferences and that those preferences aren’t well represented. However, Stephanopoulos finds much larger gender gaps than other research has suggested. Griffin and Newman, for instance, found that gender gaps in representation were rather small. However, their method was based on how frequently women had policy “wins,” meaning that the policy they supported was enacted. This means that their methodology can’t recognize “democracy by coincidence,” which Stephanopoulos’s work suggests may be occurring.

In another work, Griffin and Newman with Christina Wolbrecht find that much of the gender gap could be explained by the fact that Republicans tend to oppose policies women support. Indeed, much of the work on class and race on representation findsthatpartiescanserve as partial explanations for representation gaps by mediating preferences. The Republican Party has become “an efficient patronage machine for whites and the top 1 percent of U.S. earners.” Because the Republican party acts for the benefit of exclusively white rich men, whereas the Democratic party must juggle a broad and diverse coalition, the party system can give rise to representation gaps. However, parties are not the sole explanatory variable, because there is strongevidence that the Democratic party has shifted to the right in order to accommodate the increasing influence of the wealthy (and the declining influence of unions). In addition, Griffin and Newman note (see chapter 5) that while Democrats represent blacks and Latinos better than Republicans, they still favor the preferences of whites.

I have emphasized voter turnout frequently as a significant explanatory variable. The fact that people of color, young people, poor people and single women all turn out at a lower rate surely contributes to these gaps. The fact that nonvoters are more progressive than voters could explain the stubborn conservatism of our politics. Among these groups, who make up what pollster Celinda Lake refers to as the “Rising American Electorate,” 42 percent are unregistered, compared with 27 percent of non-RAE. Further, only 36.1 percent voted in the 2010 midterm, compared with 56.1 percent of non-RAE.

Turnout alone likely can’t explain these gaps, since women turn out at a higher rate than men, but still have less representation. However, turnout is only part of the equation: Wealthy white men also contribute far more to campaigns; Congress is full of rich white men, as are statehouses across the nation; and activists tend to be richer than non-activists. However, as long as voter turnout remains low, politicians can respond to the affluent first and foremost without fear. As political scientists Steven Rosenstone and John Mark Hansen write, “class differences in mobilization typically aggravate rather than mitigate the effects of class differences in political resources.”

Other scholars have emphasized the fact that inequality tends to reinforce itself in public opinion. For instance, Vladimir Gimpelson and Daniel Treisman find that“perceived level of inequality—and not the actual level—correlates strongly with demand for redistribution and reported conflict between rich and poor.” In addition, Kris-Stella Trump finds that rising inequality perpetuates itself, noting that, “Public ideas of what constitutes fair income inequality are influenced by actual inequality: when inequality changes, opinions regarding what is acceptable change in the same direction.” Social experiments suggest that higher levels of inequality lead lower income people to “resign” to the levels of inequality, rather than take actions to reduce the power of the rich. However, there is still strong support for redistribution and policies to reduce inequality among Americans. The problem is that support forthesepoliciesisconcentrated among the poor, people of color and women–the groups policymakers are least likely to listen to. The net result of the preferences of women, people of color, youth and poor people being ignored is to push American policy in a more conservative direction. Claims that Americans haven’t gotten redistribution because they aren’t aware of rising inequality or are too individualistic have some truth, but they obscure more than they illuminate. In reality, Americans want redistribution, but the elites who control the political system won’t give it to them. Why hasn’t democracy reduced inequality? Because it never had the chance.

This piece originally appeared on Salon. 

The case for a job guarantee

Long-term unemployment is the scourge of modern economies. In a society where people take value from work, unemployment is destabilizing and degrading. A bout of long-term unemployment can permanently scar worker, leaving them with lower wages and fewer usable skills. Last year, Jared Bernstein and Dean Baker put forwarda persuasive case for a return to full employment as the palliative to unemployment. But it’s increasingly clear the private sector cannot create full employment on its own. Even at the height of the Clinton boom, millions of African-Americans and low-skilled workers were jobless. To get full employment, progressives should embrace an idea that hasn’t surfaced recently in mainstream American political dialogue: a universal government job guarantee.

In a recent article, Derek Thompson explored a future “world without work.” While his article was well-researched and informative, it misses a key point: For inner-city Black Americans, “a world without work” is not a dystopian future, but a present reality. As Mark Levine writes, “By 2010, in five of the nation’s largest metropolitan areas, fewer than half of working-age black males held jobs. In 25 of the nation’s largest metropolitan areas, fewer than 55 percent of working-age black males were, in fact, employed.” In a recent Center for Economic Policy Research report Cherrie Bucknor notes the Black/white gap in employment rates “increased during the recent recession and is still larger than its pre-recession level.”

Reniqua Allen refers to this reality as the “permanent recession” that Black men face. People of color are the first to lose jobs during a recession and the last to gain them in a recovery. Further, many future losses from new technology will occur in heavily racialized sectors, like retail and fast food. Occupational segregation means that people of color, and particularly women of color, will bear the brunt of job losses. Racial justice requires addressing the future of work.

A government job guarantee has a long history in American politics. As Theda Skocpol notes in “Social Policy in The United States,” during the recession of the 1890s, the American Federation of Labor (which later merged with the Congress of Industrial Organizations to form AFL-CIO), requested public works to abate the recession. They repeated these demands during the early 1900s, and after World War I demanded that “a nation that sent men into battle had a moral and political obligation to make sure they had jobs when they returned home.”

However, the AFL were opposed to government-sponsored unemployment insurance. Skocpol cites Alex Keyssar who writes that, “unionists stressed that public works programs were preferable to simple poor relief in three respects: They paid workers a living wage rather than a pittance; they permitted jobless men and women to avoid the demoralizing consequences of accepting charity; and they performed a useful public service.” However, over the past decade, the government hasn’t guaranteed jobs; instead ,conservative austerity policies have lead to millions of public sector jobs being cut.

One partial reason the government job guarantee may be off the political map these days is because many of those who support such a program no longer turn out to vote. Using ANES, I find that while non-voters are more likely to support than oppose a government-job guarantee, voters are overwhelmingly opposed. However, the ANES question is also rather strongly worded: The option that “government should let each person get ahead on own” is appealing, but in an economy where millions of Americans are unemployed or under-employed even at the lowest levels of unemployment, it also seems mythological.

A recent YouGov poll asks a more pointed question: “Would you favor or oppose a law guaranteeing a job to every American adult, with the government providing jobs for people who can’t find employment in the private sector?” In this formulation support increases significantly, though as the chart below shows, there are still race and class gaps.

A job guarantee could leverage two of the strengths of the progressive movement: electoral power at the federal and city level. A progressive President could direct money and projects to mayors, thereby ending the scourge of inner-city poverty that has plagued America for far too long. Progressives have a long history of creating more jobs, but have failed to articulate an argument for why that is true. That is mainly because progressives have preferred an active monetary policy, rather than active fiscal policy, to boost employment. But voters struggle to understand monetary policy. On the other hand, they could understand a universal job guarantee.

Research suggests that Obama’s response to the Great Recession may lead to voters trusting Democrats more on the economy; but as of yet, this has yet to materialize, and Republicans remain more trusted. A universal job guarantee could change that.

A recent survey of 200 leading economic security experts by the Center for Global Policy Solutions finds that 91 percent say that job creation is important for closing the racial wealth gap. The report recommends a National Investment Employment Corps, guaranteeing jobs with an annual salary of $23,000.

The biggest opposition to a government job guarantee will almost certainly come from big business, and particularly the business-conservative wing of the Republican Party. This may seem surprising, since businesses would benefit from infrastructure and public works, as well as having a highly trained workforce. But this is to misunderstand what corporations seek: not profit, but power.

Economist Chris Dillow makes this argument, arguing that full employment would deprive business of political power by removing their mystical power over the “state of confidence.” If, in fact, the government can maintain full employment, it won’t have to kowtow to business on taxes, regulation and spending. There are also labor implications. If workers could chose to reject a private sector job knowing that a public sector job was available, business would actually have to make working conditions livable and pay a fair wage. This “reserve army of unemployed paupers,” as one economist called them, ensures that workers accept degradation on the job rather than suffer the horrifying fate of unemployment.

The ultimate goal of business conservatives is to turn labor into one homogeneous glob that can be fired, re-located and re-trained at will. Thus they oppose paid sick leave, family leave and higher wages, even though all of these changes boost workerproductivity. Business conservatives despise the minimum wage, though there is very little credible evidence that a higher minimum wage would eliminate large numbers of jobs. The threat of the minimum wage is that it would cut into profits and, more importantly, power. Though more worker ownership would boost worker happiness and productivity, it worries bosses who feel they would be ceding control. Business wants to control workers as much as possible, devising Orwellian strategies to intrusively monitor workers. Business conservatives want workers to be expendable, so they have fought to ensure that if a worker is killed or maimed on the job, they will receive next to nothing.

With workers free to pursue a well-paid, productive public job, corporations would have to pay fairer wages and ensure better labor standards. But while private companies say they love competition, in reality nothing is more terrifying. That will be the most difficult force to overcome in the push for a public jobs program. But if it can be overcome, Americans will benefit extraordinarily. In the wake of the Great Recession, LaDonna Pavetti, writes, “thirty-nine states and the District of Columbia used $1.3 billion from the fund to place more than 260,000 low-income unemployed adults in temporary jobs in the private and public sectors.” The result for workerswas higher incomes, and an easier transition into the workforce after the subsidy program ended.

During the Great Depression, make-work programs funded art and infrastructure, most of which we still enjoy today. In the future, robots may do many of the jobs that humans currently do. That shouldn’t be a lament: We can now put human effort into healing the environment, curing disease and ending hunger.

Today, millions of Americans are jobless. Putting them to work would be a boon for economic growth. In the future, everyone can have a truly fulfilling and life affirming job. But that’s going to require some will, and some government.

This piece originally appeared on Salon

How the 1 percent is systematically destroying the middle class

The idea of a property-owning democracy has long roots in American political thought. In their book, “The Citizen’s Share,” Joseph R. Blasi, Richard B. Freeman and Douglas Kruse argue that the Founding Fathers wanted everyone (well, everyone who was white and male) to own a small slice of property. Both Madison and Washington praised the relatively equal distribution of property in the United States (compared with Europe). Thomas Jefferson wrote, “It is not too soon to provide by every possible means that as few as possible be without a little portion of land. The small landholders are the most precious part of a state.” Indeed, the concept is still popular today, even on the right. James Poulos writes, “Without an ownership society, where citizens are prudent stewards of broadly distributed private property, freedom tends to become what it was in revolutionary France — an abstract ideal that can easily arouse destructive political feelings that know no bounds.” But new data suggests America may no longer be such a society, and that has worrying implications for democracy.

The idea of a property-owning democracy is no longer the reality in the United States. Edward Wolff finds that the wealthiest 10 percent own 90.9 percent of all stocks and mutual funds, 94.3 percent of financial securities but only 26.5 percent of the debt. For the middle class, their home makes up 62.5 percent of their limited wealth. (The bottom 40 percent have negative wealth.) The Gini coefficient for net worth has increased from 0.803 in 1962 to 0.871 in 2013. (By way of comparison: A Gini coefficient of 1 means that 1 person owns all of the wealth.) As the chart below shows, financial instruments and wealth are far more unequally distributed than income.

The United States is no longer more equal than European nations, but actually deeply more unequal. The chart below shows that the United States has the most unequal distribution of the wealth of any Organisation for Economic Co-operation and Development (OECD) member country examined. Across the OECD, the bottom 60 percent own about 13.3 percent of the wealth. (The bottom 40 percent own only 3.3 percent.) In Canada, the bottom 60 percent own 12.5 percent of the wealth, and the bottom 40 percent own 2.2 percent. In France, the respective numbers are 11.6 percent and 1.8 percent. And in Britain, they are 16 percent and 4.7 percent.

In the United States, however, the bottom 60 percent own a mere 2.5 percent of the wealth and the bottom 40% own negative 0.4 percent of the wealth.

As wealth and stock ownership has become more concentrated, good jobs that lead to a middle class lifestyle are increasingly eroded. Unfortunately, not enough people seem to be noticing.

Indeed, the Wall Street Journal recently reported that “apps do your chores” — but the unfortunate reality is that workers, not “apps,” are doing those chores. The workers are called “contractors,” instead of employees, meaning that they don’t get the protections full-time employees do. And examples of exploitation are piling up.

A startup called CrowdFlower Inc. — which, according to WSJ “breaks down digital jobs, such as data entry, into tiny tasks performed by millions of workers” — was recently sued for paying some of those workers between $2 and $3 an hour. Industry leader Uber, meanwhile, has been criticized for exaggerating the wages of its contractors.  This practice is becoming widespread. A recent study finds that 53 million Americans are doing some sort of freelancing work. Of those, 40 percent are full-time independent contractors, meaning they have no other source of income.

The rich are driven by two main desires: First, to make sure they have more money; and, second, that someone else does the work. There is literally no job the rich are not lazy enough to outsource. Because they cannot figure out the location of their post office, they need “Shyp.” With “Luxe,” they can get a person to park their car for them. And with “Saucey,” they can save themselves a trip to the liquor store. In a recent article for  The New Yorker, Patricia Marx describes some of the more absurd tasks that were included on TaskRabbit, including “Lego sorting,” locating “a reptile handler who is in legal possession of a rattlesnake” and finding a fake wedding ring that looks just like a real one.

It is not of insignificant concern that the rich may cease to be capable of performing the basic tasks necessary in the modern economy. The result is something like the dystopia described in the recent science-fiction film “In Time,” except that the rich elongate their lives by making the poor do their mundane tasks.

Robert Kuttner writes of TaskRabbit:

To get an assignment, an aspiring Rabbit offers to do the chore for less money than he or she thinks other prospective Rabbits are bidding. That’s what makes it a metaphor for the new economy, a dystopia where regular careers are vanishing, every worker is a freelancer, every labor transaction is a one-night stand, and we collude with one another to cut our wages.

Together these trends should be worrying: The vast majority of Americans own no assets, but are instead laden with debt. The social safety net is being shredded by plutocrats and their political henchmen. Conservatives say workers should instead get benefits from their (preferably privately owned) employers. But those companies are supporting workers less and less: Defined benefit pensions are a thing of the past, and even basic retirement plans are in decline. And that’s just for those who are lucky enough to have jobs with benefits. Many workers are misclassified, or are never employees to begin with, meaning they must manage for retirement and health insurance without all the benefits the government funnels through the employee-employer relationship.

As Matt Bruenig notes, in the United States,

“employers often handle sickness (health insurance, subsidized by federal government), old-age insurance (401k and defined-benefit pensions, subsidized by federal government), survivor’s insurance (life insurance, subsidized by federal government), family benefits (paid leave and health insurance for children), unemployment (severance, though more typically rely heavily on public unemployment insurance), on top of providing socially adequate levels of cash income.”

That is, government has funneled important social benefits through corporations. This not only makes a corporate job more cushy than otherwise, it also makes freelance work more precarious. Christopher Mims notes that, “Uber isn’t the Uber for rides — it’s the Uber for low-wage jobs.” A large portion of Americans now have two choices: Become servants to the rich for minimal wages, or starve to death. The idea that low-wage work is merely a short-term part of the rung towards a better life is also largely illusory: Upward mobility has been destroyed.

America has fallen into neo-feudalism: A wealthy capital-owning class exists behind a servile class with no assets, and only a life of drudgery ahead of them. The master-servant relationship will only further degrade social trust and civic values. Americans can’t see themselves as equals in the political sphere when large portions are consigned to wait upon the whims of new aristocracy. Conservative politics relies on the middle class making a devil’s bargain, believing they have more in common with the rich than the poor. It won’t be long before that facade crumbles.

This piece originally appeared on Salon. 

Unions still matter

This year the Republican war on unions has returned with a vengeance. In former labor stronghold Illinois, GOP Gov. Bruce Rauner is pursuing right-to-work legislation — which allows workers to gain the benefits of union representation without paying dues — and looks likely to succeed. Wisconsin became a right-to-work state last month, and its Republican Gov. Scott Walker looks set to ground a presidential bid in union busting, recently saying his political fight with unions prepared him to take on the Islamic State in Iraq and the Levant. The Supreme Court appears ready to overrule its Abood v. Detroit Board of Education decision, which allows unions to collect dues from nonmember public sector workers who nonetheless benefit from collective bargaining.

With the enemies at the gate, the liberal elite seems to have finally learned to love unions. Nicholas Kristof writesthat, contrary to his earlier opinion, “we should strengthen unions, not try to eviscerate them.” Former Treasury Secretary Robert Rubin, a key architect of Bill Clinton’s finance-friendly economic policy, recently argued, “Measures that facilitate collective bargaining can result in a broader participation in the benefits of productivity and growth.” And in “The Report of the Commission on Inclusive Prosperity,” which is likely to become the centerpiece of Hillary Clinton’s presidential campaign, the commission, co-chaired by Ed Balls and Lawrence Summers, concludes that “we need to support the growth of unions.”

But it may be too little, too late. Democrats did little to defend unions when it counted. Under President Jimmy Carter, Alfred Kahn began deregulating the airlines. Carter then signed into law legislation deregulating railroads and trucking (both hobbling powerful unions). President Bill Clinton pushed for the North American Free Trade Agreement against union opposition and deregulated finance, greatly empowering capital. To be fair, some of these pressures came from global trends, but public policy played a key role in tilting the field against labor. Now Republicans are fighting to drive a final spike in the heart of the most effective anti-inequality movement in history. If liberals do nothing to shore up unions, their decline will only continue. That will have important implications for inequality.

What unions do

Unions not only give their members a voice at work but also can have much broader political effects. By mobilizing voters and contributing to campaigns, organized labor is in effect the only lobbying group operating in the interest of ordinary Americans.

In a 1998 study, political scientists Benjamin Radcliff and Martin Saiz found that “the relative strength of the labor movement across the American states is one of the principal determinants of policy liberalism.” They found that the rate of unionization has a dramatic effects on spending for Aid to Families With Dependent Children and education as well as on tax progressivity and that these effects are stronger than Democratic governors and Democratic legislatures. As Radcliff told me, “strong labor unions are able to influence public policy, so as to create programs … that benefit everyone in society, not merely organized workers.”

Unions are the most important institution in the fight against inequality.

One way unions reduced inequality was by boosting voter turnout, which gave them political leverage. It’s rarely noted, but the campaign for Seattle’s $15 minimum hourly wage could not have succeeded without a massive, union-led voter registration drive. Many studies have confirmed that unions boost voter turnout and that their Election Day mobilizations push candidates and parties to the left.

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In a country where few politicians come from a blue collar background, unions have often been a conduit for workers to enter politics. Political scientist Nicholas Carnes found that “a 10-point increase in the percentage of the state that belonged to labor unions was associated with a 1-point increase in the percentage of state lawmakers from the working class.” Given that politicians’ occupational background and wealth influences their voting behavior, this is another important way unions can promote policies beneficial to the working and middle classes.

The right-to-work revolution

But unions have always faced deep opposition, especially in the South, where many of the first right-to-work laws were passed. Historian Elizabeth Shermer writes, “The central message in the Southern right-to-work campaigns was preserving the Old South’s racial order.” Southern elites feared that an organized working class would be a threat to the racist social and economic practices that had long defined the region. They successfully kept collective bargaining at bay with laws that forbade unions from requiring beneficiaries of its negotiations to become members and pay dues. These right-to-work laws appealed to non-elites by channeling widely held anti-government individualism. But labor law expert Raymond Hogler notes that the question has often been posed in deceptive terms:

Many polls show a strong majority of Americans are against making workers pay union dues to keep a job. That’s the wrong question. When workers in a union are asked whether anybody benefitting from a collective bargaining agreement should pay dues to support the agreement, they say yes.

As right-to-work laws spread from the South to the rest of the country, the results have been devastating. A paper by Holger, Steven Schulman and Stephan Weiler shows that right-to-work states have seen an 8.8 percent decrease in union density and that these laws account for slightly more than three-quarters of the difference in union density across states.

Another study found that from 1989 to 2002, whether a state had a right-to-work law was more important than partisan control of the state government in determining the progressiveness or regressiveness of the state’s taxes. This conclusion holds up at the global level, according to a recent International Monetary Fund study showing that lower unionization rates were associated with an increase in the share of income going to the top 10 percent of the population.

Political actors

The importance of these studies is clear: Unions are the most important institution in the fight against inequality. But for too long, many liberals seemed happy to watch unions disappear. Part of the problem is that they misunderstood unions as primarily economic institutions, interested in parochially negotiating wages and benefits for their members. In reality, unions are far more important as political actors promoting policies that benefit the working class and middle class as a whole. As legendary United Auto Workers leader Walter Reuther put it in 1970:

“There’s a direct relationship between the ballot box and the breadbox, and what the union fights for and wins at the bargaining table can be taken away in the legislative halls.”

It’s nice that the Kristofs and Summerses of the world have finally caught up with Reuther. We can only hope it is not too late.

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This piece originally appeared on Al Jazeera.

Education alone can’t solve America’s racial wealth gap

Earlier this month, the United States marked the 50th anniversary of the Selma voting rights marches. While much has changed since, racial wealth gaps have persisted over the past 30 years and even grown since the Great Recession. Today the richest 10 percent of white families own 65.1 percent of the nation’s wealth.

In a new report (PDF), Brandeis University’s Institute for Assets and Social Policy (IASP) and Demos, a progressive think tank where I work as a researcher, investigate what it would take to close this gap. The report concludes that racial disparities in wealth are driven by public policy decisions and calls for “racially aware policies” that could help reduce America’s rising wealth inequality. This includes eliminating disparities in homeownership rates, college graduation and the return on a college degree as well as the wealth return on income.

Education

Conservatives and centrist commentators often present college education as a near panacea to reduce the racial wealth gap. But the Demos/IASP report challenges this claim. It found that increasing graduation rates would reduce the wealth disparity between black and white people by only 1 percent and between Latinos and whites by 3 percent. There are many possible reasons for this. For one, students of color take out more in student loans than white students. The debt burden detracts from wealth-building opportunities over a graduate’s lifetime. In addition, people of color are less likely to get into the most selective schools and face discrimination in labor markets after graduation. As a result, black and Latino students do not reap the same gains from a college education as their white counterparts.

In fact, race is a far greater determiner of wealth than education. As Demos blogger Matt Bruenig pointed out last year, black college graduates have less wealth than white high school dropouts. Using a new model called the racial wealth audit, Demos/IASP researchers found that the racial wealth gap between white and black families would be reduced 10 percent if the returns on college education could be equalized. But that’s not nearly enough to close the divide.

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Income

Bruenig’s previous research found that blacks and Latinos in the same income brackets have less wealth than whites. The Demos/IASP report confirms these findings: Black and Latino households with similar income distribution as whites would still face a substantial wealth gap. Eliminating income gaps would reduce the wealth gap by only 11 percent for black people and 9 percent for Latinos. Among black households, the average family would own $92,545 less wealth than an average white family. The average Latino family would own $94,033 less wealth than the average white family. This is because income distribution only tells part of the story. The remaining gap can be explained, in part, by the differences in opportunities to turn wages and salaries into wealth.

Controlling for the differential returns on every dollar of income shows a far greater effect on wealth disparity. In fact, for every $1 that accrues to black families with an increase in income, white families earn $4.06. For every $1 in wealth for additional income to Latinos, white families earn $5.37. The racial wealth audit shows that equalizing the return on income could reduce the wealth gap with white households by 43 percent for black households and by 50 percent for Latino households. But black and Latino families earning the same incomes as white families will still have only half the wealth.

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It may be surprising to those who think that racial equity depends on equal opportunities in the labor market alone. But it’s important to remember that income is a flow, while wealth is a stock. White families have been building up wealth for centuries, thanks in part to the enslavement of black people and discrimination against blacks and Latinos, who were excluded from those gains.

A 2004 paper from economists Maury Gittleman and Edward Wolff provides some hint as to why income equity cannot solve the racial wealth gap. After controlling for income and with a similar return on capital, the authors found that black families save at the same rate as whites. Previous IASP research corroborates their findings (PDF). Differences in wealth outcomes are explained by factors such as inheritance, home ownership and unemployment.

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As shown in the chart above, in another study (PDF), Wolff and Gittleman demonstrate that black and Latino families are far less likely to receive wealth transfers and that when they do, they tend to be smaller. Wealth transfers include inheritances and tax reductions, which disproportionately benefit white people. In fact, wealth transfers are the most unequal aspect of the wealth disparity. The Gini coefficient, the most common measure of inequality, runs from 0 (in which all wealth transfers are equal) to 1 (in which one household receives all wealth transfers). In 2007 the Gini of wealth transfers (primarily inheritances) was 0.961, compared with a 0.489 posttax and transfer Gini of income in the same year (PDF). That is, the distribution of wealth transfers is twice as unequal as the distribution of income. Even when households that did not receive a wealth transfer are excluded from the analysis, the Gini is still at 0.814. That means nearly all the wealth transfers in the U.S. go to a small group of people at the top.

Millennials

The Demos/IASP report also shows the deficiency in the way millennials understand race in the United States. This is worrying given the fact that the millennial generation is often said to be postracial. Millennials are more likely to believe that racial disparities should be allowed to correct themselves than their parents are. In many ways, their views align with those of conservative Supreme Court Chief Justice John Roberts, who in 2007 argued, “The way to stop discrimination on the basis of race is to stop discriminating on the basis of race.” However, it ignores the effects of history and how wealth replicates itself. In his pioneering book “The Son Also Rises,” historian Gregory Clark notes that:

Groups that seem to persist in low or high status, such as the black and the Jewish populations in the United States, are not exceptions to a general rule of higher intergenerational mobility. They are experiencing the same universal rates of slow intergenerational mobility as the rest of the population. Their visibility, combined with a mistaken impression of rapid social mobility in the majority population, makes them seem like an exception to a rule. They are instead the exemplary of the rule of low rates of social mobility.

Clark found that the residual effects of family wealth remain for 10 to 15 generations. A family’s wealth cache simply won’t go away without dramatic changes.

Even more concerning, the notion that racial inequality can take care of itself is not only embraced by white millennials but also by millennials of color (though to a lesser extent). This means that the institutionalized structural barriers to racial equity are not receiving enough attention. Many Americans fail to understand how much more unequally wealth and financial assets are distributed than income.

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To parrot Roberts, the best way to reduce the racial wealth gap is to reduce the racial wealth gap — not simply to increase access to education or income. Policies that bolster home ownership — the leading wealth asset for most middle-class families — and those that reduce neighborhood segregation will do far more to close the wealth gap than changes in education. Other progressive ideas such as a baby bond program, which establishes wealth-building opportunities for those who have been excluded from them in the past, could substantially reduce wealth gaps.

Deeply entrenched wealth disparity is the product of history. Eliminating it entails reckoning with history as well as robust public policy reform. Ideological commitments to equality of opportunity without policy action won’t be enough.

This piece originally appeared on Al Jazeera

If everyone voted, progressives would win

In preparation for the 2016 presidential election, Democrats appear united around one candidate, while the Republican contest remains far from secured. Many on the left, who view Hillary Clinton’s stances as a tame brand of liberalism, have attempted to draft Sen. Elizabeth Warren, D-Mass., to run. But the progressives do not need a charismatic leader. Instead, they need to invest in unleashing the disgruntled progressive majority. A longer-term strategy for progressives should be to strengthen unions and boost turnout among politically marginalized populations.

“If everybody in this country voted,” the economist John Kenneth Galbraith said, “the Democrats would be in for the next 100 years.” There is strong evidence to support his claim. A 2007 study by Jan Leighley and Jonathan Nagler found that nonvoters are more economically liberal than voters, preferring government health insurance, easier union organizing and more federal spending on schools. Nonvoters preferred Barack Obama to Mitt Romney by 59 percent to 24 percent, while likely voters were split 47 percent for each, according to a 2012 Pew Research Center poll. Nonvoters are far less likely to identify as Republican, and voters tend to be more opposed to redistribution than nonvoters.

In a recent nationwide study, Stockton College professor James Avery found a strong correlation between the electorate’s class bias and the Gini coefficient, a commonly used measure of inequality. In short, the lower the turnout, the higher the class bias and the greater the support for policies that lead to inequality. His study builds on previous research by political scientists Christopher Witko, Nathan Kelly and William Franko showing how class bias in voting reinforces economic inequalities. Their findings are not confined to the U.S. Around the world, voter turnout is correlated with redistributive policies. For example, the turnout of low-income voters has been linked toregressive state tax systems and higher social spending.

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In “Regular Voters, Marginal Voters and the Electoral Effects of Turnout” University of Chicago professor Anthony Fowler found that marginal voters — those whose willingness to cast a ballot is affected by factors such as weather and the timing of elections — support liberal candidates. He estimates that 72.8 percent of those who do not vote because of weather support the Democratic Party. In fact, weather may have contributed to Electoral College victories for the Democrats in 1960 and the Republicans in 2000. He examined gubernatorial elections, which can coincide with a presidential election or a midterm year, and found that 68.2 percent of those who don’t turn out for midterm elections support Democrats. Among the 34 million people who were registered with a party but did not vote in the 2010 midterms, 63.1 percent supported Democrats, according to Fowler. And gubernatorial elections that coincide with the presidential race “increase turnout by 17.4 percentage points and the Democratic candidate’s vote share by 6.4 percentage points,” he said.

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High voter turnout benefits Democrats, but studies also show that it increases volatility and harms incumbents. The anti-incumbent effect is particularly important, because it means that all incumbent politicians, including Democrats, may be partly disinclined to support policies that will boost turnout. Democrats might also have to worry about a more progressive challenger swinging potential votes away from the party.

But can turnout be swayed? Evidence suggests so. A study of 170 countries by the International Institute for Democracy and Electoral Assistance found that electoral structures dramatically affect turnout. (See figure 19.) Measures such as no-excuse absentee voting, expansive early voting and Election Day registration have increasedturnout. But in the United States, research suggests that the more black people in a county — a group that tends to vote for Democrats — the fewer early voting sites there are.

Regardless, a simple get-out-the-vote strategy is not enough. In a 2005 seminal study, political scientist Adam Berinsky found that reforms that make it easier for registered voters to cast ballots increase the socioeconomic bias of the electorate. Get-out-the-vote campaigns increase turnout only among individuals with already high propensity to vote. While these voters may still be liberal, electoral reform is needed to increase registration among nonvoters, particularly the poor. In 2012 only 52.7 percent of those with income below $10,000 were registered to vote, compared with 83.5 percent of those earning more than $150,000, according to U.S. census data. In order to address the gap in voting between those in the top and bottom income brackets, electoral reforms must affect registration.

This is why Election Day registration (EDR) and “motor voter” laws are critical to improving electoral participation. For example, in a report released last month, Demos found that if all states used a “motor voter” system, which allows voters to register at local DMVs, it would increase registration by 18 million. These measures have reduced political inequality, particularly in states with registration bias. EDR consistently leads to higher turnout.

Changing the composition of the electorate is the easiest way to shift policy to the left.

Progressives can also improve their electoral prospects with better information. First, there is the evidence from the Kaiser Family Foundation that Americans are least likely to know that reforms they support are included in the Affordable Care Act and most likely to know that reforms they oppose are included. “If the public had perfect understanding of the elements that we examined,” a group of researchers wrote in 2012, “the proportion of Americans who favor the bill might increase from the current level of 32 percent to 70 percent.” In another recent study, Fowler and Michele Margolis exposed participants (through fake op-eds) to simple facts about Republican and Democratic policy platforms on social and economic issues such as the earned income tax credit, minimum wage, abortion and same-sex marriage. “When uninformed citizens receive political information, they systematically shift their political preferences away from the Republican Party and toward the Democrats,” the researchers said.

AJAM5.3

Changing the composition of the electorate is the easiest way to shift policy to the left. As John B. Judis and Ruy Teixeira point out, what they call the “emerging democratic majority” has always existed but just hasn’t voted. Instead, Democrats should mobilize the marginalized progressive majority. There was a time when progressives saw voting rights as essential to their strategy. In 1992, California Gov. Jerry Brown told Bill Clinton that his campaign would have Brown’s “full endorsement” if Clinton supported a $100 cap on political contributions, a ban on PACs, universal registration, same-day registration and an Election Day holiday. As Joan Didion points out in “Political Fictions,” Clinton did not receive Brown’s endorsement because at the time the more centrist Democratic Leadership Council’s strategy was to “jettison those voters who no longer turned out and target those who did.”

That strategy limits the liberalism of the Democratic Party because those who less consistently turn out tend to be more liberal than those who do. In addition, it alienates low-income people, further depressing turnout and creating a self-reinforcing cycle of people becoming increasingly alienated from established politicians and increasingly unlikely to vote. Democratic politicians are wary of policies to boost turnout because of its anti-incumbent effect and the possibility of progressive challengers.

Now with Democrats on the defensive across the country, conservatives fighting full franchise and progressives realizing the limits of hero leftism, there may be an effort to mobilize the marginalized progressive majority. If they are persuaded to weigh in at the ballot box, they can sway the agenda that Democratic leaders support. As a truly great progressive, Franklin Delano Roosevelt, once said to his progressive base, “I agree with you. Now make me do it.”

This piece originally appeared on Al Jazeera.

Republican policies don’t help people of color

The United States continues to struggle with persistent racial gaps. There are large gaps between blacks and whites in terms of income, political representation, treatment in the criminal justice system, upward mobility and wealth. And the illusion of a postracial society, particularly in the younger generation, is hindering efforts to reduce these gaps. While Democrats say they are trying to alleviate racial gaps by increasing the ladders of opportunity for people of color, Republicans continue to pretend these gaps do not exist.

In their study “Racial Winners and Losers in American Party Politics,” political scientists Zoltan Hajnal and Jeremy Horowitz examine the two parties’ claims that their policies benefit racial and ethnic minorities. According to Hajnal’s and Horowitz’s research, Republican policies predominately benefit the richest white Americans. An oft-repeated defense of this fact is that Republicans make the pie bigger for everyone while Democrats work to redistribute wealth to the poor and people of color. The evidence demonstrates that, on the contrary, Democrats make the pie bigger for everyone, while Republicans redistribute income toward the rich and whites. (See chart below.)

The popular criticism that both parties are the arms of a corporate America also misses the granular changes that shape income distribution. As political scientist Nathan Kelly has shown (PDF), Democratic governments don’t just shift the income distribution with explicitly redistributive programs; they change pretax income distributions to favor the wealthy through what he terms market conditions such as regulation. Sociologists David Brady and Kevin Leicht find the same effect from right-wing governments, both before and after taxes and transfers. The changes combine to dramatically improve the income distribution under a Democratic president.

Hajnal and Horowitz looked at available data for changes in income, poverty and unemployment under every president since 1948. The authors lagged the data by one year since presidential actions take time to trickle down. For example, a decrease in black poverty in 2009 would be credited to George W. Bush’s administration. As shown in the table below, all racial and ethnic groups appear to benefit economically more under Democratic administrations than Republican ones.

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Although they still benefit significantly more from a Democratic president, the gap between the two parties is the smallest for whites. Hajnal and Horowitz estimate that black poverty declined by 38.6 percent under Democratic leadership, while it grew by 3 percent under Republicans. From 1948 to 2010, black unemployment fell by 7.9 percentage points under Democrats and increased by 13.7 points during Republican administrations. Black income grew by $23,281 (adjusted for inflation) under Democrats and by only $4,000 under Republicans.

“Put simply: However measured, blacks made consistent gains under Democratic presidents and suffered regular losses under Republicans,” the authors said. While there’s limited data, the findings hold true for Latinos and Asians.

It appears at first glance that Republicans actively transfer income to whites through government. Of course, there could be another explanation for this phenomenon. In a study published last July, Princeton economists Alan Blinder and Mark Watson found that from 1947 to 2013, gross domestic product, employment, corporate profits and productivity grew faster under Democrats than Republicans. The authors also noted that unemployment and deficits shrank and the economy climbed out of recession in less time under Democrats. (See chart.)

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Blinder and Watson attribute half these benefits to productivity shocks, consumer expectations and favorable economic conditions. They leave the other half unexplained, but studies suggest that liberal policies increase growth by boosting wages and perceptions about income security. By contrast, Republican policies slow growthand immiserate the population. The researchers also found that the economy grew even faster when Democrats control both chambers of Congress and the presidency.

It might appear that Democrats are better at managing the economy. However, as Hajnal and Horowitz point out, economic growth alone is not enough to explain racial gaps under the two parties. In fact, the results remain unchanged even after controlling for factors such as inflation, the size of the labor force, the price of oil and GDP. They found that black incomes grew by $1,000 more each year under Democrats, while poverty fell 2.6 points faster and unemployment dropped by 1 point more.

Black income growth stalls when a Democratic president is paired with a Republican Congress. Furthermore, the longer Democrats are in power, the stronger the economic gains for blacks. By contrast, blacks fare worse when Republicans are in office longer. There are similar racial gaps in the criminal justice system. Black and white incarceration rates fell dramatically (a net of 61 fewer arrests per 1,000 residents) under Democratic presidents, while they increased (36 more arrests per 1,000 residents) under Republican leadership.

Last place aversion

This raises questions about why whites largely lean Republican in elections and who benefits from Republican control of our government. The answers are intertwined. As Princeton political scientist Larry Bartels explains, economic growth is shared far more equally under Democratic presidents than under Republicans. (See chart below.) Contrary to popular belief, the incomes of the very rich increase more under Democrats than they do under Republicans. While pretax and transfer incomes are rather similar, the main shift occurs posttax and transfer.

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Similarly, in absolute terms, whites do better under Democratic than under Republican leadership. But that doesn’t really matter. People weigh their well-being relative to those around them. There is strong evidence that whites often oppose actions against inequality because of “last place aversion,” the desire to ensure that there is a class of people below oneself. Among white voters, racial bias is strongly correlated with lower support of redistributive programs. For example, research shows that opposition to welfare is driven by racial anger. Approximately half of the difference between social spending in the U.S. and Europe can be explained by racial animosity.

Democrats enjoy a broad-based support among the American electorate. But they lose elections because of enthusiasm gap, which is attributed to the party’s inability to rally a diverse coalition of educated, working-class whites, people of color and unmarried women. By contrast, the Republican base is easy to mobilize, allowing them to turn the government into an efficient patronage machine for whites and the top 1 percent of U.S. earners, using what Suzanne Mettler, a professor of government at Cornell University, calls the “submerged state” — subtle tax breaks and benefits such as marriage subsidies and the mortgage interest deduction.

All in all, those who claim that Democrats have abandoned the middle class or failed blacks are missing a larger story. While the Democratic Party has been imperfect in responding to the policy demands and preferences ofblacks and low-income voters, it has done a far better job of improving their condition than Republicans have. Conservatives’ attempts to rebrand themselves as beneficial to the working class or people of color will succeed only if voters remain unaware of their actual record.

This piece originally appeared on Al Jazeera.