Monday, October 5, 2009

A Suggestion for Controlling the "Gordon Gekko-ization" of the American Economy

Having just finished reading Ross Douthat's op-ed in the Times, I was struck by something. Where is the accountability in the creation of the widest income gap since the end of the Gilded Age, since it was the policies (primarily, though not entirely) of the political party he seems to support that really accelerated that income gap? Where was this concern during throughout the last eight years? What were the sound economic principles from conservatives on the issue of income inequality?

Now, I am no economic historian, but if I recall correctly, from the administrations beginning with Reagan and ending with the second Bush, our political leaders dismantled the protections that had been put in place following the Great Depression (which managed to help move the country into unbridled prosperity for decades). I have wondered why there has not been a push from Congress to retrofit those measures for 21st century realities and put them back into place. The only answer I could find is that it would reduce the overall profits of the top 1% of income earners, which of course is out of the question.

Until we can control the "Gordon Gekko-ization" of American capitalism, which has brought this nation to its current economic state, we will continue to suffer this type of income inequality. In that sense, the Democratic party needs to have a "come to Jesus" moment about what its policies should reflect. Why not update what the FDR administration put in place and make that the law of the land? Why not think more "Main Street," than Wall Street (removing the burden of small businesses having to pay the health insurance of their employees might free up some capital)? With these ideas, as well as developing a green manufacturing based economy, I think that the Democratic party will have a much better time tackling income inequality. Otherwise, the party may as well act like Republicans and continue to drive the majority of Americans into an economic abyss (like their conservative policies almost did).


Christopher S. Ledbetter said...

But... you forget... greed is good, greed works, greed cuts through and captures the essence of the evolutionary spirit. Greed, in all of its forms, for life, for love, for money, has marked the upward surge of mankind. LOL!
Seriously, though, (thinking conservatively here) if you remove the incentive for wealth creation (ie tax the hell out of the rich) then what else would they have to work so hard for... certainly not the betterment of mankind. That's no fun!

hscfree said...

Chris, I don't think that people would argue that incentives for wealth creation was removed when these regulations were imposed during the Great Depression. It's more than "taxing the rich." That's always seemed like a short term solution, to the larger problem. But, we have also seen what happens when you drive tax rates down, even in the midst of two wars, along with the elimination of safeguarding regulations on the financial sector: our current situation.