Monday, June 24, 2013

Hanauer Economics

I don't agree with the right's feigned perspective that enriching "job creators" (i.e. the wealthy) is the route to a healthy economy.

And I don't agree with the right's actual goal of shielding the rich from paying taxes, regardless of societal cost.

And I don't agree with the left's perspective that government's the best vehicle for providing charity for the poor.

I'm with Nick Hanauer, a billionaire who's been pushing the notion that extreme income inequality is bad for everyone, not just the poor. He sees it not as a moral issue, but as an economic one. The middle and lower classes are the engine of any economy, so impoverishing them to massively enrich the upper classes will inevitably lead to catastrophe for the entire economy.

This perspective's neither liberal nor conservative. It's simply rational.

Here's Hanauer's wonderfully stated, highly persuasive TED talk from last year (a very worthwhile 6 minutes):

...and here's his latest, a proposal for a $15/hour minimum wage. Not out of a paternalistic leftie urge to boost working people's standard of living, but out of a wise economic desire to stoke economic fire by ensuring that the bottom of the pyramid has sufficient buying power to keep the economy rolling.
The fundamental law of capitalism is that if workers have no money, businesses have no customers. That’s why the extreme, and widening, wealth gap in our economy presents not just a moral challenge, but an economic one, too. In a capitalist system, rising inequality creates a death spiral of falling demand that ultimately takes everyone down.
Credit to Andrew Tobias for the link - and the excerpting.

Some of the billionaires pushing the policies (e.g. tax cuts for "job creators") leading to extreme income inequality are simply short-sighted, but not all of them. There's been a push by the extreme right over the past half century toward internationalism, where companies draw demand (as well as cheap labor) from the developing world. It's a business-centered view of economics where demand's treated as a resource to be squeezed in an effort to draw all money to the top. This explains some of the blithe disregard for the health of the American economy.

The mindset stems from a predatory, long-term nonviable, and monstrously distorted view of free market capitalism, which is supposed to result in a happy, stable equilibrium; symbiosis between buyers and sellers rather than unbridled parasitism by the latter.

We've reached a level of distorted economic view where even that term, "symbiosis", would offend many conservatives. Up is down, down is up. The Christian Right is intolerant and unloving, and free market economists view consumers as disposable fodder for scorched-earth business domination.

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