Saturday, November 5, 2011

Matthew Continetti tries to take a pass on income inequality

In the newest Weekly Standard, Matthew Continetti makes the case that conservatives don't really have to care about income inequality—whether it's growing or not—because it's not government's job to address such issues. 
Inequalities of condition are a fact of life. Some people will always be poorer than others. So too, human altruism will always seek to alleviate the suffering of the destitute. There is a place for reasonable and prudent actions to improve well-being. But that does not mean the entire structure of our polity should be designed to achieve an egalitarian ideal. Such a goal is fantastic, utopian even, and one would think that the trillions of dollars the United States has spent in vain over the last 50 years to promote “equality as a fact and equality as a result” would give the egalitarians pause.
That sounds principled, and maybe even a little bit appealing if you're of the right temperament. But it fundamentally ignores one simple fact: By virtue of taxing and spending, and even of making laws, the federal and state governments have some bearing on how wealth is distributed in this country—even if they're not in redistributionist mode. 

To get a sense of how this might be the case, here is Derek Thompson's graph showing how various income groups would fare under Rick Perry's flat tax plan:

Perry's plan, in essence, would exacerbate inequality by raising taxes on the poor while giving millionaires a tax cut equal to the median income of 10 American households.

Now, I expect the conservative response to this is: "But that's their money, not the government's." Sure. But nobody except a few libertarians is advocating that we do away with taxes entirely, and that we stop paying for government at all. Until we get to that point, there will be taxes. And how taxes are structured will affect how wealth is distributed—even if affecting that distribution isn't the aim.

The laws and regulations formulated by government have a similar effect. During the pre-Reagan era, for example, the strength of unions was credited for raising income and living standards for the entire middle class—including non-union members, who enjoyed a spillover effect as non-union employers competed for workers. The decline of union strength over the last 30 years is believed to be one reason that middle class wages have stagnated during that time. Right now, though, there are efforts in several states—including my home state of Kansas—to further undermine the ability of private-sector unions to organize and advocate on behalf of their members. That, too, seems likely to affect the income inequality situation in the United States.

Now, I don't think it would be unreasonable to conclude from the above examples that many Republicans (and more than a few Democrats) tend to pursue policies that exacerbate inequality, often at the best of rich supporters. But there are clearly some conservatives—David Frum, Ross Douthat, Reihan Salam, Michael Gerson among them—who see inequality as a problem, and want the broader movement to do something to address it.

Not every conservative believes that rising income inequality exists, or that it's a problem. Continetti's point is different: That conservatives don't have to care about it, policy-wise, because such income inequality isn't the government's business. If conservatives believe that inequality is rising, and that it's a problem, then I imagine there are conservative paths to addressing the issue. It may not be the state's role to address income inequality (in the conservative vision) but that doesn't matter: The state affects the situation nonetheless. Conservatives who simply wash their hands of the situation signal where their real priorities lay.

No comments: