Outside the Beltway

Matt Yglesias presents this Gallup poll as evidence that Barack Obama is on the right side of the redistributionist issue while John McCain and Joe the Plumber are in the minority:

Says Matt, “What you see here is that traditionally a large majority of Americans have favored spreading the wealth around.”

Well, no. What you see here is that traditionally a large majority of Americans have favored having more money. It’s one thing, though, to lament the unfairness of, say, Paris Hilton having millions while you’ve got only thousands and quite another to advocate the government taking away her money and divvying it up.

2008 Election, Economics and Business, Public Opinion Polls, US Politics

Barack Obama, Gallup, Joe Wurzelbacher, John McCain, Matt Yglesias, Redistribution

32 responses to “Equality vs. Redistribution”

Dave Schuler

October 31, 2008 at 1:12 pm

I think there’s a real, genuine major question lurking behind what is an otherwise frivolous discussion: what organic moves would result in a more even distribution of income?

Taking money away from some people at the point of a gun and giving it to others may be an effective way to redistribute but it’s certainly not organic nor IMO moral.

The Clinton Administration’s answer to this question was education and there’s some lip service to that answer today. IMO that solution was dealt a death blow when improved telecommunications and computer technology made it possible for many white collar jobs which had required all those newly-minted BA’s to be performed in Dublin or Bangalore as easily as in Poughkeepsie.

I’d like to see a serious attempt at disaggregating the effects of education from the effects of licensing on job and wage security. Seems to me that if licensing is the key the policy solution is different than if education is.
Steve Verdon

October 31, 2008 at 1:37 pm

Taking money away from some people at the point of a gun and giving it to others may be an effective way to redistribute but it’s certainly not organic nor IMO moral.

Good luck trying to convince Matt of that.

The Clinton Administration’s answer to this question was education and there’s some lip service to that answer today. IMO that solution was dealt a death blow when improved telecommunications and computer technology made it possible for many white collar jobs which had required all those newly-minted BA’s to be performed in Dublin or Bangalore as easily as in Poughkeepsie.

Really? But why is Dublin doing well, I haven’t checked the data, but I’m willing to bet the typical Dubliner is paid more than the typical Bangalorean. Why Dublin? Why Ireland? Could it be the economic reforms they implemented?

I’d like to see a serious attempt at disaggregating the effects of education from the effects of licensing on job and wage security. Seems to me that if licensing is the key the policy solution is different than if education is.

Theoretically licensings impact is going to be ambiguous. Sure it will raise wages for those with licenses, but licensing is often a barrier to entry which means that some of those wanting to enter that market wont be able too, thus increasing inequality.
Wayne

October 31, 2008 at 1:40 pm

The question is bogus especially as it applies to Obama. First it gives only two lame choices. It is about like asking if the Shag O’Neil is paid about right or do they need to pay him more. James was going in the right direction. The needed to ask the question along the line of “On the subject of the governments taking money from people and redistributing it do you think it is about right, too much or not enough?
Steve Verdon

October 31, 2008 at 2:09 pm

You know, in regards to U.S. inequality and even median incomes I wonder how much of an effect immigration, legal and illegal, has on the numbers. I’m wondering if it is creating a false impression of stagnation and or growing inequality, when in reality things might be the opposite.
Tami

October 31, 2008 at 2:41 pm

That has got to be the dumbest Gallup Poll questions ever posed! Seriously, of course most people will say that they think the distribution in unfair!! We all want more $$ and think the current money and wealth is not distributed fairly, because every person thinks they need or wants more. DUMB DUMB DUMB!! Maybe the author could find a better statistic to show how Obama’s plan is good for America.
anjin-san

October 31, 2008 at 2:46 pm

quite another to advocate the government taking away her money and divvying it up.

Well, that is not what Obama is advocating, so why even include it in your comments? He is advocating rolling back Bush tax cuts which were clearly weighted in favor of the rich/super rich, who Bush was in the tank for from day one.

We should also keep in mind that McCain is on the record saying that there is nothing wrong with the rich paying a bit more because they can afford it, here is the video, it is pretty straightforward, as is the fact that he has changed his tune out of his own cynical political needs:
anjin-san

October 31, 2008 at 2:48 pm

I have to add, watching this video, WFT happened to the John McCain who was such an admirable guy in many ways? I have not seen him for a while now.
Jeffrey W. Baker

October 31, 2008 at 2:51 pm

Ireland is the largest recipient of net flows of money from the other EU nations, so it’s quite disingenuous to hold them up as a beacon of the free market and deregulation. They are doing well because money flows from Germany to Ireland and the Irish use the proceeds to subsidize business. See if your redistribution meter can process that one.
anjin-san

October 31, 2008 at 3:01 pm

As far as Ireland goes, they have made some smart moves, especially the ones aimed at attracting tech companies. On the other hand, what is Ireland’s defense budget?
Steve Verdon

October 31, 2008 at 3:02 pm

Ireland is the largest recipient of net flows of money from the other EU nations, so it’s quite disingenuous to hold them up as a beacon of the free market and deregulation.

True, but they also deregulated as well as lowered corporate profits taxes. The latter two make Ireland look more desireable to foreign investors.

They are doing well because money flows from Germany to Ireland and the Irish use the proceeds to subsidize business.

Really?

The EU aid was used to increase investment in the education system and physical infrastructure. The increased productive capacity of the Irish economy is often attributed to these investments, which made Ireland more attractive to high-tech businessmen.[3] The libertarian Cato Institute has suggested that the EU transfer payments were economically inefficient and may have actually slowed growth.[4] The Heritage Foundation also downplayed the role of transfer payments.[3] Ireland’s membership in the European Union since 1973 helped the country gain access to Europe’s large markets. Ireland’s trade had previously been predominantly with the United Kingdom.[5]

Of course money is fungible, so having Aid money for education frees up other domestically raised money for those subsidies. Still Ireland had other things going for such as low wages, low corporate tax rates, and membership in the EU–i.e. access to the entire EU market.
Tami

October 31, 2008 at 3:05 pm

If the tax cuts were for the super rich, why then did my father in law (who didn’t have a job for most of the year) get $$ back. I PAID MORE TAXES than he did in 2007 and he got back $600, while I only received $1200—weighted for the wealthy?? Jeez you only had to make a small amount of $$ to get it!!
Floyd

October 31, 2008 at 3:08 pm

“evidence that Barack Obama is on the right side of the redistributionist issue while John McCain and Joe the Plumber are in the minority:”
“”””””””””””””””””””””””””””””””””””””””””””””””””

You obviously mean that the poll places Obama on the “Politically Correct” side.
Gallup may place McCain in the minority, but he is still on the right side of the argument as well as the correct side of it.
Jeffrey W. Baker

October 31, 2008 at 4:04 pm

Ireland can lower corporate profits tax because the net flow of money from the EU allows them to. If they had to break even on internal revenue, they would obviously revisit their tax rates. That’s why I say the EU subsidy flows to business.

There’s no doubt that access to the market is a good feature and that they have a highly educated workforce.
spencer

October 31, 2008 at 4:44 pm

Both parties take money from the rich and give it to others. The difference is only one of a very, very, very small degree.

As long as we have taxes the government will take money from the rich and give it to others.

For a republican to think they are any different from the democrats on this is really a clear case of the pot calling the kettle black.

It is a stupid political claim.
Zelsdorf Ragshaft III

October 31, 2008 at 4:45 pm

Anjin you genius, if not for the U.S. defense budget, what do you suppose the chances are the world would be dominated by Germanic or Slavic totalitarian influences with the possiblity of domination of Asia by Japanese? I just wonder why it is you do not think Barack Hussein Obama would be good for America? From his early childhood association (education) from Frank Marshall Davis, a known communist, Khalidi, Ayers, Dohrn, Rezko, ACORN, Wright, and a long list of America lovers he has sought out and befriended. One gets the idea, unless afflicted with ideological blindness, Obama could be Marxist in policy. If you trust what he has said on the campaign stump, fool. He has been on both sides of any issue that is important. He has said conflicting things one day apart and lies his ass off. List his accomplishments, Anjin. I dare you.
sam

October 31, 2008 at 4:53 pm

Goddamn socialists:

The necessaries of life occasion the great expense of the poor. . . . The luxuries and vanities of life occasion the principal expense of the rich, and a magnificent house embellishes and sets off to the best advantage all the other luxuries and vanities which they possess. . . . It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
Steve Verdon

October 31, 2008 at 5:16 pm

Ireland can lower corporate profits tax because the net flow of money from the EU allows them to. If they had to break even on internal revenue, they would obviously revisit their tax rates. That’s why I say the EU subsidy flows to business.

There’s no doubt that access to the market is a good feature and that they have a highly educated workforce.

Which is supposedly where the EU grants went. That and improving infrastructure.
anjin-san

October 31, 2008 at 5:30 pm

List his accomplishments, Anjin. I dare you.

Well, he has helped expose you as a ranting lunatic. Not a very high bar to clear, I will stipulate…
DL

October 31, 2008 at 7:33 pm

What is unnerving is watching people who call themselves Christians rushing to support the politics of envy, eager confiscation of other’s property, and justification of infanticide as they wag their tongues and tickle their own ears.
sam

October 31, 2008 at 7:55 pm

BTW, the “goddamned socialist” in my above was Adam Smith, than that which there is none greater in the right-wing economic pantheon.
James Joyner

November 1, 2008 at 7:22 am

It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.

Smith’s advocating a consumption tax that will necessarily fall more heavily on the rich, or at least those who spend more. Specifically, in that passage, he is saying that taxing rents will fall disproportionately on those in opulent housing but that this is fine. And, indeed, that would be precisely the type of taxation scheme I’d prefer.

That’s far different, though, than choosing an arbitrary earnings level and levying a punitive tax rate on it.
sam

November 1, 2008 at 7:31 am

That’s far different, though, than choosing an arbitrary earnings level and levying a punitive tax rate on it.

Aye, James, but it’s the principle underlying the quote that’s the main thing. You and Smith would prefer that it be instantiated one way, I perhaps another–but the principle remains.
Rick DeMent

November 1, 2008 at 9:43 am

Smith’s advocating a consumption tax that will necessarily fall more heavily on the rich, or at least those who spend more.

Actually James, Smith proposed “Ground Rents” which are property tax not consumption tax. And with the top 5% owning something on the order of 90% I would be all for this.

But Sam is right, you say you can go along with the underlying principal of those with more paying a bit more proportionally yet you quibble with a progressive income tax on some kind of moral ground. To be sure income is not an exact proxy for the amount of property one owns, it is often correlated.

The income tax does have arbitrary levels but any tax would other then simply whacking up the bill for government and splitting the check. But then every man woman and child would owe something like
15K each. I find your support of Adam Smith in principal and your denunciation of a progressive income tax as punitive contradictory.

One more thing, the argument over the income tax misses one gigantic point which is why do we have an economy where a few people can get so unimaginatively wealthy, but produces so few jobs offering incomes that can’t even meet the lower levels to pay income tax? Seems to me that there is something structurally wrong with the system. The reward to some activities are over rewarded to the the extrema where some kinds of work are devalued arbitrarily.

No economic activity is worth 3500 times that of the least valued activity with out the system being gamed. period.
James Joyner

November 1, 2008 at 10:05 am

No economic activity is worth 3500 times that of the least valued activity with out the system being gamed. period.

Why not? Certainly, 3500 more people get value out of, say, watching Peyton Manning play than, say, the dude yelling “Bud Lite! Get your Bud Lite! at the stadium.”

I support proportionality in paying taxes, in the sense that I don’t support paying for government through a head tax. Someone making $250,000 a year is going to pay more tax than someone making $25,000 a year regardless of how you slice it.

If you do a flat tax, it’ll be proportionate. If you do a flat tax with a standard deduction, it’ll be slightly less so. If, conversely, you do it through a consumption tax, it could be vastly more so, since the rich may consume disproportionately more than they earn.
Steven Taylor

November 1, 2008 at 12:09 pm

Regardless of anything else, the poll in question represents a fairly ridiculous set of questions.
Bandit

November 1, 2008 at 12:14 pm

Barack Obama is on the right side of the redistributionist issue while John McCain and Joe the Plumber are in the minority

Being in the minority and being on the wrong side of this issue are not the same thing.

No economic activity is worth 3500 times that of the least valued activity with out the system being gamed. period.

Actually any activity is infinitely more valued than nothing

This whole argument is just a lot of words to say that many think the world owes them a living.
Steven Taylor

November 1, 2008 at 12:57 pm

Some more thoughts on the redistribution “debate” here.
Jason

November 1, 2008 at 4:18 pm

Wow, if this is an example of how slanted all polling questions are, then I will never believe another poll again.
sam

November 1, 2008 at 5:49 pm

@Bandit

Being in the minority and being on the wrong side of this issue are not the same thing.

In politics they are.
wilky

November 1, 2008 at 6:12 pm

I’m of the belief that we are all created equal and have equal interest in the well being of this country, therefor we should all pay the same percentage of tax, on income. I’d much prefer the fair tax however.

The dirty little secret that we don’t tell our children is that if you(or are partnered with someone who does) creates, develops or distributes something of value to the public at large you will be payed. If you aren’t so inclined, well you can still take a job, and make a nice living with something to set aside for another day. The choice is ours. My personal view, that I hold only myself to, is that to just take a job is to enslave myself to others.
Dan

November 3, 2008 at 2:23 pm

They are only talking about redistribution of the wealth of working people NOT rich people. Paris Hilton is RICH. No one is talking about taking her wealth only a higher % of her earnings.

We do not tax the rich, only those working Americans with large earnings.

With the repeal of 401K deferment and the cost of energy after the imposition of carbon emissions taxes every American will be hit dramatically by increased taxes.
Saffron Cooker

November 7, 2008 at 12:43 pm

Post election. A few are realizing that a Clintonesque cabinet is being formed. The undoing of Clinton’s welfare reforms will require some wordsmithing, but that seems to be their forte’. How can the federal income tax system be used as a welfare system (tax refunds to non-taxpayers)? I think Rahm is up to the job, but we will find out how many enemies he made on the Hill.

I am surprised at the expectation level for the administration’s first year. IE “A spring 2009 redistribution check WILL show up in my mailbox.”