First Conservative Blog

Conservative Blog post for October 6

The Liberal Class Warefare Trap

Excellent piece over the weekend by NYT’s Ross Douthat who outlines the essential reasons Democrats will fail again on their pet issue of wealth re-distribution.   Long used as a wedge issue to separate Americans from their shared interests (as well as from significant amounts of their cash), class envy and class warfare have been carefully nurtured as a Democrat talking point to stir up the masses against evil Republicans.   The problem now is that Democrats are the party of wealth and privilege.

According to the Wall Street Journal, of the 25 wealthiest Congressional districts, 14 are now represented by Democrats – some of the hard left variety such as Jared Polis of the Colorado 2nd, a district which includes the People’s Republic of Boulder and several Colorado ski towns where only the very wealthy can afford to live.  Polis is feeling the pressure on the President’s health care takeover bid as some of the ideas being floated include soaking his constituents in Colorado ski country.  This probably won’t be enough pressure to compel Polis to vote against the Chosen One’s takeover plan, but it is pressure. 

 Highlighting the fact that Democrats are as much the party of Wall Street and the wealthy, Douthat’s piece warns the left that promising to fix wage inequality is a guaranteed campaign loser because the very things that cause it are rooted in constituent interests of those that support the party.   In other words, Democrat policies create radical wage inequality.  Particularly by encouraging large numbers of illegal immigrants to settle within the US, Democrats force down wages for the all unskilled workers and make upward income mobility for all much more difficult.   And proposing ever-increasing tax rates on the wealthy endangers their re-election bids.

As we learned during the early stages of the housing crisis, several Connecticut big-wigs in the home lending industry were solicited by lefty crook Senator Chris Dodd during his last election effort.  These well-heeled execs coughed up big chunks of their salaries for Dodd’s campaign at the demand of those running their companies.  Several mortgage executives in that state compelled workers elsewhere in the hierarchy of their companies to contribute the legal limit to the Dodd campaign and to send copies of the checks to the CEO’s office to enforce compliance.  With executive patronage at the top of its game, Dodd easily won that election.  Dodd then dutifully overlooked mortgage mis-management which led to the bursting of the housing bubble, but still allowed senior execs to take huge bonuses.  With these stories now on display under the light of day, 2010 may be quite a different story for ‘ol Senator Chris. 

Among the most interesting points made by Douthat concerns the public education system.  Citing the incredibly arcane and illogical methodologies that must be followed to fire a rotten teacher, Douthat reasons that the education system –without genuinely meaningful reform – will continue to turn out poorly educated students.  Anyone who has tried to hire a high-school graduate for a temporary position has already learned that.  The natural extension of this point is that poorly educated US students will wind up competing with unskilled immigrant labor for service sector jobs.  This will only depress the wage scale further. 

As the Democrat party is ‘owned’ by among others – the teachers unions – any meaningful reform is highly unlikely.  Firing a public school teacher would require implementation of exceptionally expensive re-training program to give the incompetent employee a chance at a career change.  With budgets already stretched, Democrats just want this problem to go away and for now seem content with just letting public education turn out uneducated Democrat voters.  Still, running through the same talking points about how wage inequality is tearing the country’s social fabric it is ironic that the left’s own policies enable the disparity.  

Another favorite Democrat tactic, federal intervention in the form of increasing minimum wage requirements – only fuels inflation, restricts employment and again exacerbates wage disparity.     By raising the minimum wage, employers restrict hiring below a level that they otherwise would if not hindered by minimum wage requirements.  This deprives the unskilled of needed experience required to move up the economic ladder.  Here again, Democrat initiatives to increase minimum wages only restricts employment opportunities and drives up the unemployment rate.  Of course both of these trends contribute to the escalating wage disparity between unskilled and professional workers.

Another observation – and one that seems entombed in US eastern liberal thought – is that the only thing that can bring about wage equality is cycling the entire productive capacity of the country through the government.  Douthat points out that this has succeeded in Western Europe where the size of say, the French state has brought relative wages for workers at all levels into closer proximity to one another.   The major omission is that although some low-level workers may be well paid for what they do, the highly skilled professionals are incented to leave the country to earn a better living.  Many wind up here in the US. Removing the most highly skilled professional workers from the calculation is a major reason for Europe’s relatively low (compared to the US) producing economies on a per capita basis.  And of course by making the executive level relatively ‘poorer,’ the wage gap narrows.    In a sense, though, Europe has succeeded in bringing some level of wage parity to reality – by making all people poorer than they would be in a free economy.

Douthat concludes his piece with an admonition that the price for making wage equality may be too high for Democrats to bear.  One can only hope.  For the complete text, click here .