Obama's "Fairness" Economy Has Backfired

There are two obvious ways to start fixing income disparity, and neither seems to interest the president.

One of the most seductive parts of President Barack Obama's political message (and the message of progressive Democrats in general) is sympathy for the poor and a willingness to talk about the disparities of capitalism -- about the rich being too rich and the poor being screwed. In some ways, it's the predominant message of the Obama era.

White House Flickr feedWhite House Flickr feedAnd though it's reasonable to contend that Republicans need to display more compassion -- if for nothing else than their own political survival -- isn't it also reasonable to take stock of how things have gone for the poor under four-plus years of progressive rule?

Now, if you're heavily invested in the market, life is peachy. A confounding fact, no doubt, when one considers that nearly every economic indicator known to mankind has been pretty abysmal of late. We are experiencing high unemployment, a shrinking labor force, stagnant gross domestic product growth and rickety consumer confidence. A disconnected market, though, has been on a historic boom. So if we need any more proof that life really isn't fair, think about this: The rich have the Federal Reserve, and you have Harry Reid.

What does it mean in substance? According to a new Pew Research Center analysis of Census Bureau data, thanks to a robust stock and bond market, coupled with a lousy housing market, the recovery has meant that households with a net worth in the upper 7 percent have seen their net worth rise, on average, by nearly 30 percent in the years after the recession and that everyone else's net worth has dropped by an average of 4 percent.

The economic gap between whites and minorities is even worse. According to the Urban Institute, whites, on average, have two times the income of blacks and Hispanics and six times the wealth, and that gap is accelerating.

This is going on, if you can imagine, even after a tax hike on the wealthy.

The left's answer to this accelerating disparity under Obama will, no doubt, be more regulatory burdens, more tax hikes (the president is still obsessed with closing loopholes on private jets -- a rounding error, in his budget), more deficit spending and more programs that smooth over all the unjust vagaries of life. Most often, these solutions erect barriers to mobility for small businesses and entrepreneurs -- the types of people who help alter the dynamics of mobility. Despite what you may hear, more revenue for government doesn't create wealth. A freer economy and more societal stability do.

If Americans believe that government should promote opportunity and mobility and not equality of outcomes, as this administration claims, allowing more economic freedom would not leave us hapless in the face of unregulated anarchy. It would do the opposite. It would invite more innovation and more opportunity.

Or forget policy. Maybe this is a moral question. Maybe it's a question of leadership. You may believe that government has no business telling us how to lead our lives. I would agree. But if the president were really concerned about inequality, rather than praise abortion mills, he might want to speak out on the importance of families, which, whether we like it or not, are one of the leading indicators of personal prosperity. He might want to speak out about the immorality of a welfare state that helps destroy those families.

Because really, what policy passed or proposed by Democrats over the past four years has started or would start fixing the income disparity in any substantive way? There are two obvious ways to start doing that, and neither seems to interest the president.

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  • kinnath||

    Only the weak and the stupid believe that inequity is the result of unfairness.

  • Concerned Citizen||

    Facebook has revealed many of my friends as weak and stupid.

  • JJK||

    ^^This. Since becoming a more active libertarian, my facebook "friend" count has been cut by over 60%. Addition by subtraction

  • SQRLSY One||

    Hi JJK, I had a co-worker who attended “breakfast club” with me & others at work, swear off going there because of a pro-freedom thing I once said… The co-worker relented on his horrible threat… But what I said was, “Hey, we’re spending tons of money & lives bringing freedom & democracy to Iraqis, but we can’t have any for us. Time to bring the troops home & have them shoot some DEA agents so that states who vote for medical marijuana, can have it.” I was a horrible NAZI or some such, for saying that… But you know, the French Revolution may have had similar roots… French starving peasants paying taxes out the ass, while the French King-Queen-etc. are spending their money… To bring freedom to American revolutionaries, while French taxpayers lack freedom! Learn your history, I say… Well anyway, your “friends” don’t like you being a Libertarian? Tough noogies! They say, “You want to legalize pot = you want all the kids hooked on pot”, right? Let’s outlaw divorce… You’re not in FAVOR of divorce, now, ARE you!?!?!

  • Jordan||

    As leftwingers generally understand it, sure. But the government does contribute greatly to inequality in this country, via the regulatory leviathan and the Federal Reserve.

  • SQRLSY One||

    Amen, Jordan! Notice in this article hear that Obama is obsessed about taxing the owners of private aircraft more… While he has a fleet of presidential aircraft! I have not heard of Emperor Obama giving them up to save tax money, he’d rather eliminate the ability of the common scum and peasants, to come and tour his mansion, instead. Government is the great un-equalizer… And don’t get me started on the government ragging on the hidden racists under every bed, while the Fed “war on drugs” is way far and away the biggest racist thug on the block.

  • AlexInCT||

    What's easier? Blaming yourself for things not going your way when you do the minimum or nothing to assure the outcome, or laying the blame at the feet of some exernal force that's unfair?

    Understand that, and you understand these people.

  • hotsy totsy||

    ^^exactly.

  • Bill Dalasio||

    Well, not really. Just not in the way people usually think about it. A great many government interventions provide massive economic rents at the expense of everyone else. They're not usually advertised as such, but the effects remain unchanged.

  • pitbull07||

    up to I looked at the bank draft that said $5552, I be certain that my mom in-law truley making money parttime at there labtop.. there brothers friend has been doing this 4 only about 17 months and just now paid for the morgage on there mini mansion and got a great Volkswagen Golf GTI. read more at wow65.com
    (Go to site and open "Home" for details)

  • CE||

    Hey, Obama said he would grow the middle class. Some people just didn't realize that he would do that by taxing some of the near rich down a notch.

  • AlexInCT||

    The really rich, whom for obvious reasons love the donkeys despite their public display of anger towards the rich, love the guy and his party. That's because their wealth has grown the fastests and the most under this crusader of social justice. The middle class has been hammered at the same time. Nanny state government is always 2 tier. The haves and the have nots, and the middle class will be pushed into the have nots to make it simpler.

  • Sam Grove||

    The subtle purpose of the left is to wreck markets and proffer government management as the only alternative.

  • ||

    Let's make the economy suck so we can run everything and make it suck worse.

    Great idea.

  • ||

    They don't seem to be very subtle about it anymore.

  • ||

    The problem is overregulation.

    Right now we're in a situation where there's no new technology, no new field of endeavor to suck all the labor that is being displaced by advances in technology. To so-called great stagnation.

    But, IMO, it's clear that advances in technology would be happening, and would be sucking up labor if it weren't for a lot of heavy handed regulation. This applies at every level, from individuals who can't turn their crafting hobby into a business because of the regulatory compliance costs, to small businesses that can't exapand because of the regulatory compliance costs, to large businesses that can't roll out new technologies like biotech crops or thorium reactors.

    Imagine what the economy would look like if we had a free market in energy, and anyone could set up a thorium reactor and start selling electricity without having to go through seven layers of red tape and permitting and public hearings where anti-nuke idiots and NIMBYs get to decide what you're allowed to do?

  • BakedPenguin||

    Isn't Obamacare alone responsible for something like 3 million lost jobs? I honestly think that the US could have China-like levels of growth if real deregulation took place.

  • ||

    Everywhere would have ridiculous levels of growth if real deregulation took place. Shit, just think of the explosion of jobs and products and ingenuity if weed were legalized throughout the US without crippling taxes and with the ability to sell all the accompanying paraphernalia.

  • John||

    And there would be busts too. Busts and the business cycle happens. And there would be much more change and instability. You and I know that is a good thing. But it absolutely terrifies liberals. I think more than anything liberals are motivated by a fear of change and a love of stasis. They want to control everything because they don't want anything to change unless they decide it should.

  • Scruffy Nerfherder||

    This. And government is uniquely incentivized to oppose change and implement stasis.

  • grey||

    We have busts with or without the government oppression. It might be argued the government worsens the bust cycles for the middle and lower class while softening the cycle for the wealthy. Wait, isn't that basically what the article said?

  • izzyabby||

    Agreed. However, the Fed floating funny money is the phony support for the market...replacing wealth creation with borrowing is always disastrous. Only a Keynesian would attempt to borrow their way into prosperity.

    As a result of this policy, major inflation will create many, many broke, hungry, angry people, none giving a damn about an esoteric policy discussion.

    The future isn't what it used to be.

  • grey||

    I'm only now beginning to understand the problem's with the Fed. I'm doing some reading that I hope gives me a better grasp.

  • Troglodyte Rex||

    Read everything Krugman puts out, then think the exact opposite.

  • GILMORE||

    ""just think of the explosion of jobs and products and ingenuity if weed were legalized throughout the US ""

    Dude! Totally...

    ....like, right after Ren and Stimpy. Also, make some nachos.

  • John||

    It would be very interesting to watch what happened. We would grow a lot more and would be better off. But there would be pretty big dislocations as various parasite industries were forced to compete with up and comers. A lot of big business benefits from the entry barriers created by regulation. Those businesses would not do as well.

    There would be chaos, lovely, destructive and creative chaos.

  • Pro Libertate||

    This came up in a different context last week, but this is why I wasn't happy when Virginia moved off of the dynamism-vs.statism discussion to focus on glamor. I think the former is a far more compelling lens to view current politics, culture, and even science through.

  • ||

    Maybe it's an oblique way of telling progressives they're just a bunch of slaves to fashion.

  • Pro Libertate||

    Sure, there's truth in that--in fact, I think much of the difference between leftists and libertarians (really, even conservatives) is that much of leftism seems dominated by the fashionableness of leftist politics, and, of course, viewing everything through an emotional prism, regardless of facts.

    Of course, this latter point isn't the whole story, as subsuming your reasoning to partisanship, regardless of the cause, it another way to reach the same effect.

  • grey||

    It's a left and right problem. My own partisanship had me defending positions that twisted my ethics and defied logic. But no worry, I always had a partisan strawman argument, fallacy, or could spin the argument away from the logical inconsistency.

  • ||

    Also, lots of status seeking behavior.
    Displaying one's Godliness or compassionateness by expressing concern for the poor or expressing support for correct moral values is a status seeking behavior. Same goes for a lot of environmentally conscious purchasing. One wants to be SEEN to be the "right sort of person".

  • ||

    I was thinking about this yesterday in regards to bumper stickers.

    Slapping a political bumper sticker on one's vehicle is sort of a combination of 'I'm a good person' and 'I'm one of you'. Sometimes political bumper stickers are 'The other side sucks!' But it's still tribalistic, social status, ape-brain related behavior. 'We're good, they're bad.', othering or 'See what a good person I am.' status seeking.

  • ||

    And most people's actual standard of living would rise. Those parasite industries don't produce anything anyone actually needs.

  • Scruffy Nerfherder||

    I, for one, need more buggy whips.

  • UnCivilServant||

    If there's enough of a market, someone would sell them to you.

    Otherwise, you'll have to commission a craftsperson to make them.

  • Scruffy Nerfherder||

    Thank Gore for the interwebs.

    http://www.buggy-whips.com/store/

  • Bill Dalasio||

    And monocles, dammit!!

  • Dr. Frankenstein||

  • LTC(ret) John||

    But those are only available in Drop Bear Land. I suppose ifh could get one....any Murican monocle makers?

  • Dr. Frankenstein||

    There were some cheap ones made for the steampunk set. And a vintage monocles from Maine.

    This one looks good.

    http://www.nearsights.com/

  • grey||

    "And most people's actual standard of living would rise. Those parasite industries don't produce anything anyone actually needs."

    For me this gets to government utility, I get so little for every dollar put into the machine. Some bozos will talk about 'economy of scale' I get from some very specific services (fire/police), but their argument falls to shit when you expand your view to the full spectrum of supposed government services and all the cronyism, which I will not get utility and they cause me additional labor and cost. I give (I use the word 'give' to mean 'take') a dollar in order to have someone tell me to spend more dollars on things I don't need or want. Seems to me this is the opposite of utility.

    I'm paying for the pleasure of additional burdens?

  • some guy||

    And that chaos would be another barrier to deregulation. People would look at all the jobs lost as favored companies lost their status and had to compete and they would recoil, probably before the market could settle things out and reveal that deregulation was the right decision. That's one of the problems with having a 2-year political cycle. It's shorter than the natural business cycle so we always have a major election before the long term consequences of a given policy are realized.

  • Certified Public Asskicker||

    India's building, what, 50 or so?

  • Dennis Webb||

    Not to mention the economist boost from cheaper energy from tracking and the Keystone pipeline, both of which are being held back by Obama's need for support from the environmental left.

  • ||

    What Obama and TEAM BLUE say they want and what they actually do (and the effects of what they do) are two utterly different things. Since TEAM BLUE supporters are mindless sheep who will reliably follow whoever spouts the right words, regardless of results, what their leaders say can be effectively ignored, since they know that they will not be held to account in any way. The only important metric is what the results are. And the results are inevitably: CONTROL and CRONYISM. That's it.

  • Butler T. Reynolds||

    True. Same for TEAM RED. We're doomed.

  • Pro Libertate||

    How can it be fair when the government hasn't taken all of my money yet? Until I'm taking home nothing, there can be no true equity in this country.

  • Aresen||

    If you have a home, it is unfair.

  • Pro Libertate||

    It's amazing the inequity bottled up in just me alone. And I think there are millions more still retaining private property and cash reserves. And income!

  • Aresen||

    When everybody* has nothing, everything will be fair.

    *"Everybody" in this usage does not include TOP MEN.

  • Pro Libertate||

    What we need is for Yellowstone to blow and erase all property.

  • grey||

    The problem is not the idea of redistribution, but only it's application. We've never had the right top people managing the process.

    /libtard

  • Doctor Whom||

    [I]sn't it also reasonable to take stock of how things have gone for the poor under four-plus years of progressive rule?

    It's the fault of (circle all that apply: Bush, obstructionist teathuglicans, not enough stimulus spending).

  • some guy||

    Wall Street, the rich, the 1%...

  • LTC(ret) John||

    ATMs, computers, hoarders, wreckers and kulaks.

  • JWatts||

    Gun owners, Big Oil, racists, stupid people,....

  • SugarFree||

    Woo! I'm gonna get me an Obamaphone and Barry is gonna fill up my gas tank with the blood of nasty old rich people!

    /certain deleted portions of my Facebook feed

  • Scruffy Nerfherder||

    My tank is only filled with blood of the finest old rich people from Palm Springs.

  • Lord Humungus||

    mine tank is filled with the blood of children who are too weak to work my salt mines.

  • Scruffy Nerfherder||

    No, you see the advantage to my choice is that I get to use their finely tanned and stretched skin for the timing belt.

  • UnCivilServant||

    I use petrol, I need my car to actually work.

  • Archduke Pantsfan||

    Did you not get a conversion kit along with your top hat, monocle, and subscription to SugarFree Weekly upon registering?

  • Scruffy Nerfherder||

    I found Epi's preferred monocle

  • UnCivilServant||

    Uhhh... no, I check the "not a libertarian" box. I got the Free Hypocracy upgrade bundle instead.

  • UnCivilServant||

    But not the spellchecker.

  • Archduke Pantsfan||

    BREAKING: Someone just posted this on a facebook thread:
    Theoretically high taxes spent right (on services) should save you money in services you would normally be spending on.

  • Scruffy Nerfherder||

    Theoretically, I can spend that money better than you, so give it to me instead of the government.

    Theoretically, Marx was right.

    Theoretically, the universe is either infinite or not.

    I can do this all day.

  • grey||

    Theoretically, nobody died in the Soviet Union and there is no starvation in North Korea.

  • Loki||

    Wow. That's so breathtakingly stupid that I'm not even sure I would respond to it. Or if there even IS a response.

  • Scruffy Nerfherder||

    The correct response is "Fuck off slaver"

  • LTC(ret) John||

    Always a good one. Or you can break out the "No, fuck you. Cut spending."

  • Bill Dalasio||

    The probability of that being true is non-zero, but infinitely small.

  • LynchPin1477||

    HYPOTHETICALLY (FTFY) a perfect world would be perfect! But for some reason people won't behave exactly the way I tell them they should. It's almost like they have their own free will. How annoying!

  • EugenePatrickDevany@gmail||

    "If Americans believe that government should promote opportunity and mobility and not equality of outcomes ..." it would reduce the tax burden on the poor and stop redistributing 7.5% of GDP to successful investors and corporations through tax expenditures which make the market quite unfair.
    We would have sustainable full employment with no additional government spending if we eliminated both the regressive job killing payroll taxes and the $1.2 trillion in tax expenditures.

  • JWatts||

    Translation: Raise taxes the rich and lower taxes on the poor!

  • Aresen||

    Even in libertopia, there would be "unfair" results. (A better product gets a smaller market share than its rivals, a more qualified candidate for a job gets passed over because the successful candidate is a personal friend of the recruiter, etc.)

    SOME unfairness is inevitable.

    However, punishing people by taxation for being successful is probably the most unfair thing you can possibly do, no matter how "noble" your motives.

  • Bill Dalasio||

    Except only some success gets punished in the game we're moving to. If you are successful because of government connections, perhaps the unfairest way to gain success, you'll not only be pardoned your success, you'll be actively celebrated.

  • Sevo||

    "SOME unfairness is inevitable."

    It's when it's enforced by gov't coercion that it's hard to correct.

  • grey||

    Unfairness seems to imply there is always an external cause and even implies there is a human element. Which neither is true all of the time. I have come to dislike even the words I'm forced into using during political dialogue. Often times the word unfairness actually means only, 'the predictable outcome' or it is just a bullshit word that has nothing to do with cause and effect.

    Perhaps too existential, but I feel like there is an entire vocabulary, that I may not have been exposed, that would explain everything I see around me better.

    Klingon maybe.

  • LynchPin1477||

    Income inequality is not, in and of itself, immoral if it arises from a system free of coercion, deception, and cronyism. It is simply a reflection of differing talents, decision making, and to a certain degree, luck (though I think luck plays a much smaller role than most people want to believe). Some people may think it is "unfair" that luck has anything to do with it, but that's life. And it is actually a good thing that there is income inequality to at least some degree because the ability to succeed and fail gives people an incentive to work hard to improve their situation by whichever measures of success matter to them.

    This doesn't preclude practical economic and political arguments against massive income inequality. Nor does it preclude a moral argument for charity and altruism. Unfortunately, this is a subtlety that seems to get too easily lost in the debate. The fact that I can be OK with one individual having more money than some countries but at the same time work to help people in poverty better themselves is totally baffling to some people.

  • coma44||

    "Fairness" is Progressive Liberal speak for "I'll kiss you and nibble your ear before I fuck you in the dumper"

    When they say fair ask them for the "who" and "
    how" then listen to the lies.

  • entropy_factor||

    agreed, this is my favorite game. Listening to the lies, that is. Fucking in the dumper is probably #7 or so on the list.

  • kupekyrenes||

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  • Anders||

    Backfired?

    Au contraire.

    We are fundamentally transforming America, comrade. Yes, this does involve punishing our enemies, rewarding our cronies, and getting everyone on the government teat.

    I know it seems scary, but trust me comrade. We too can become a modern social democracy like Britain.

    Change!

  • Micu5||

    I have Harry Reid? Kill me now. President Obama isn't interested in "fixing" anything. He just wants to bring more of our lives under government control. Only then can things be truly fixed in the grand progressive plan. The fatal conceit. So it's pointless to talk about whether or not their policies will work, because they don't really care. They want to make irreversible changes to the whole system.

  • jyc3@alhambrapartners.com||

    You almost got there with the line about the rich having the Fed and the poor having Reid. The inequality problem - to the extent it is a problem - is rooted in monetary policy. I wrote about the same study just last week: http://www.alhambrapartners.co.....ipulation/

  • Polo Ralph Lauren outlet||

    Only to ensure the benefit of the people in order to get the people's support.
    Converse UK sale http://www.conversesaleuk.co.uk/
    Borse Burberry http://www.borseburberry.it

  • Tom Beebe||

    Here's a path to a better outcome for our most disadvantaged:
    Fifty years ago, the economist Milton Friedman wrote that the minimum wage would do great damage "To Negroes and Negro youth". No group is in greater trouble today than they are. Now President Obama has proposed increasing the minimum wage to $9.00.
    Why not an amendment to his proposal which would scale back the wage by 10% a year to help bring youth into the workforce?

    $4.50 for age 15
    $5.40 for age 16
    $6.30 for age 17
    $7.20 for age 18
    $8.10 for age 19
    and then $9.00 for age 20 and above.

    It has been said that the minimum wage was created to protect union wages. Isn't it time to "spread their wealth around? As an employer, wouldn't you hire a kid for $4.50 where you would leave the job open if you had to pay an adult $9.00?

  • Troglodyte Rex||

    Someone would claim age discrimination.

  • deacc||

    We, not the gov't, should be responsible for our own destiny.

  • Bookkeeper||

    If you think about it, squeezing the middle class makes sense from a "what's in it for me" perspective. The wealthy provide cash for campaigns, libraries, and junkets (within reason, the DoJ can only avert their eyes so many times). The poor provide voting blocks that can be organized with vans, voting lists, and cash - a far simpler matter than actually trying to persuade someone. The middle class tends to want to be convinced, and won't give you anything that's not already being taken by force. The rational politician's answer? "Screw Them." Historically, that decision has not gone poorly for them, either.

  • Emily698||

    Start working at home with Google! It's by-far the best job Ive had. Last Tuesday I bought a gorgeous Lancia Straton from earning $4331 this - 5 weeks past. I began this 7-months ago and right away started to earn at least $69, per-hr. I use this website,, http://Mojo50.com

  • ||

    A disconnected market, though, has been on a historic boom www.vendreshoxfr.com. So if we need any more proof that life really isn't fair, think about this: The rich have the Federal Reserve, and you have Harry Reid.

  • Dennis Webb||

    "According to a new Pew Research Center analysis of Census Bureau data, thanks to a robust stock and bond market, coupled with a lousy housing market, the recovery has meant that households with a net worth in the upper 7 percent have seen their net worth rise, on average, by nearly 30 percent in the years after the recession and that everyone else's net worth has dropped by an average of 4 percent."

    This particular piece of BS has been repeated ad nauseam. Since the upper 7th precent saw a loss of 30% or more in their investments during the recession, they have now gained back the same 30% since the stock market has rebounded. So has everyone else who had investments in the market and had the good sense to just leave them alone when the recession hit.

  • crystallann||

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  • derfel cadarn||

    If "fairness" means giving people things that have not earned or do not deserve then it would be better for our bleeding nation that the Republicans stay the way they are. Things here will never get better rewarding sloth and avarice over hard work and industriousness..

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  • EstherBartz||

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