Joe Biden's economic team beats Trump's goon squad – but it faces a steep challenge

“It’s time we address the structural inequalities in our economy that the pandemic has laid bare,” President-elect Joe Biden said this week, as he introduced his economic team.

It’s a good team. They’re competent and they care, in sharp contrast to Trump’s goon squad. Many of them were in the trenches with Biden and Barack Obama in 2009, when the economy last needed rescuing.

But reversing “structural inequalities” is a fundamentally different challenge from reversing economic downturns. They may overlap – last week the Dow Jones Industrial Average hit a record high at the same time Americans experienced the highest rate of hunger in 22 years. Yet the problem of widening inequality is distinct from the problem of recession.


https://education.howard.edu/sites/education.howard.edu/files/webform/cbs-new-york-jets-vs-las-vegas-raiders-live_.pdf

https://education.howard.edu/sites/education.howard.edu/files/webform/colts-vs-texans-webcast.pdf

https://education.howard.edu/sites/education.howard.edu/files/webform/dolphins-bengals-kick-off.pdf

https://education.howard.edu/sites/education.howard.edu/files/webform/minnesota-vs-jacksonville-tv.pdf

https://education.howard.edu/sites/education.howard.edu/files/webform/nflcast.pdf

https://education.howard.edu/sites/education.howard.edu/files/webform/nfl-cbs-week-13.pdf

https://education.howard.edu/sites/education.howard.edu/files/webform/nfl-colts-vs-texans-week-13.pdf

https://education.howard.edu/sites/education.howard.edu/files/webform/nfl-w-e-e-k-1-3-vivo.pdf

https://education.howard.edu/sites/education.howard.edu/files/webform/sb-nations-nfl-live.pdf

Recessions are caused by sudden drops in demand for goods and services, as occurred in February and March when the pandemic began. Pulling out of a recession usually requires low interest rates and enough government spending to jump-start private spending. This one will also necessitate the successful inoculation of millions against Covid-19.

By contrast, structural inequalities are caused by a lopsided allocation of power. Wealth and power are inseparable – wealth flows from power and power from wealth. That means reversing structural inequalities requires altering the distribution of power.

Franklin D Roosevelt did this in the 1930s, when he enacted legislation requiring employers to bargain with unionized employees. Lyndon Johnson did it in the 1960s with the Civil Rights and Voting Rights Acts, which increased the political power of Black people.

Since then, though, not even Democratic presidents have tried to alter the distribution of power in America. They and their economic teams have focused instead on jobs and growth. In consequence, inequality has continued to widen – during both recessions and expansions.

For the last 40 years, hourly wages have stagnated and almost all economic gains have gone to the top. The stock market’s meteoric rise has benefited the wealthy at the expense of wage earners. The richest 1% of US households now own 50% of the value of stocks held by Americans. The richest 10%, 92%.

Why have recent Democratic presidents been reluctant to take on structural inequality?

First, because they have taken office during deep recessions, which posed a more immediate challenge. The initial task facing Biden will be to restore jobs, requiring that his administration contain Covid-19 and get a major stimulus bill through Congress. Biden has said any stimulus bill passed in the lame-duck session will be “just the start”.

Second, it’s because politicians’ time horizons rarely extend beyond the next election. Reallocating power can take years. Union membership didn’t expand significantly until more than a decade after FDR’s Wagner Act. Black voters didn’t emerge as a major force in American politics until a half-century after LBJ’s landmark legislation.

Third, reallocating power is hugely difficult. Economic expansions can be a positive-sum game because growth enables those at the bottom to do somewhat better even if those at the top do far better. But power is a zero-sum game. The more of it held by those at the top, the less held by others. And those at the top won’t relinquish it without a fight. Both FDR and LBJ won at significant political cost.

Today’s corporate leaders are happy to support stimulus bills, not because they give a fig about unemployment but because more jobs mean higher profits.

“Is it $2.2tn, $1.5tn?” JP Morgan chief executive Jamie Dimon said recently in support of congressional action. “Just split the baby and move on.”

But Dimon and his ilk will doubtless continue to fight any encroachments on their power and wealth. They will battle antitrust enforcement against their giant corporations, including Dimon’s “too big to fail” bank. They’re dead set against stronger unions and will resist attempts to put workers on their boards.

Comments

Post a Comment

Popular posts from this blog

Mothering as a Brief Timeline of Overarching Disappointment

  B eing a mother was something I always wanted, despite (or because of?) my own childhood. Let’s just say my own mother was less than nurturing and had a violent, nasty streak that meant my psyche was hammered out on an anvil of fear, forged in survival. I knew I could do better, and I did. I wasn’t perfect, mind you, but damn near good enough. My daughter is striking. Olive skin, blue eyes, tall. Taller than I. Her lineage is indigenous Australian, but it’s a heritage that’s hard to pinpoint just by looking at her. She could be Greek, Italian, Spanish. While I celebrated her bloodline, she is ashamed and does not want to know her history. Australia is racist country and Aboriginal people are, unfortunately, not highly regarded. When she met her boyfriend, now fiancée, she gave me strict instructions to “not tell him what I am”. I often wonder whether that feeling of deep shame, an internalised reflection of how Australian society views her Aboriginality and hence her, has somehow...
Read more

Japan suspends entry of non-resident foreigners

  The Japanese government has suspended entry of non-resident foreign nationals to Japan to prevent the transmission of coronavirus variants. The measure is taking effect on Monday and will continue through January 31. A similar restriction is already in effect for travelers from the United Kingdom and South Africa. The government also suspended a conditional exemption of a 14-day self-quarantine that had been applied to Japanese and foreign residents when they reentered Japan after a short overseas business trip. All travelers returnin g  to or entering Japan from parts of the world where coronavirus variants have been confirmed need to submit a negative test certificate. Such travelers need to take a test within 72 hours before departure and another upon arriving in Japan. https://eventplanning.odos.virginia.edu/sites/eventplanning.odos.virginia.edu/files/webform/patriots-vs-bills-live-stream-HQ_0.pdf https://cawp.rutgers.edu/sites/default/files/webform/patriots-vs-bills-liv...
Read more

How Canadian citizenship processes may change in the future

  IRCC released details of its report on the citizenship program between 2013 and 2018. A recent immigration department self-evaluation highlights areas where Canadian citizenship processes could be improved. The report, released in November, revealed Immigration, Refugees and Citizenship Canada’s (IRCC) findings and recommendations on how to address issues in the  citizenship program . As it is now, permanent residents can apply for citizenship if they have lived in Canada for at least three years, among  other eligibility requirements . Generally, citizenship applicants must pass a citizenship test, or interview, and prove their language skills in English or French. IRCC’s self-evaluation covered the period from 2013 to 2018, with previous years taken into consideration. It was done as part of an accountability measure with the Treasury Board, which oversees the funding of federal departments, including IRCC. They found that out of the more than 2.8 million permanent re...
Read more