American Elephants

The upward path of income mobility is not always smooth, and not always easy, but for anyone who is determined, it has changed little in the last 50 years. You may get lots of help or have to do it all on your own, but the path is there and open. Freedom is the key.

This year Lyndon Baines Johnson’s “War on Poverty” is fifty years old, and a failure. Unlike today’s Democrats, Johnson was quite explicit on what he intended. The purpose of the “war on poverty” was to make “taxpayers out of taxeaters,” and the slogan was “Give a hand up, not a handout.” He declared “The days of the dole in our country are numbered.” 50 years and trillions of dollars later, there is more dependency than ever. Ironically, dependence on government had been declining since 1960 and was only half of what it had been in 1950. It started up again with the War on Poverty.

In the State of the Union address on Tuesday, President Obama is expected to make income inequality— as measured by the Census Bureau— the centerpiece of his speech. He is unlikely to mention that income inequality has increased more on his watch than it did under any of the three previous presidents. The policies that he is pushing have provided few benefits to those they are supposed to help. Redistribution, raising taxes on the rich would seem like it would help, but Clinton raised taxes and inequality went up. Bush cut taxes and inequality was unchanged during his term in office.

Raising the minimum wage is popular with those who believe that the minimum wage is just not enough to support a family — but that’s not what the minimum wage is supposed to do. It is supposed to be a beginner wage where inexperienced people can learn how to work. It is often called an Unemployment Act for young people — who are usually the ones who get minimum wage jobs. It does not reduce inequality. The minimum wage climbed 21% under Clinton, and inequality also climbed. The unemployment rate among black youth is a disgraceful  60%.

  Obama has proposed setting up “Promise Zones” in economically distressed areas that will get federal help and some tax breaks. This is not new, but a variation on the enterprise zone program which had no effect on job or business creation. Obama’s favorite is college aid, but federal aid has exploded in recent years, and encourages increases in tuition. Business wants more immigration, but increased numbers are not good for those struggling at the bottom. The CBO found that the Senate immigration bill would depress the overall average wage for the first ten years.

If there is one thing that most defines the Obama administration, it is the push for control. New regulations are pictured by the large stacks of paper that represent new pages in the Federal Register. The most obvious difference between Democrats and Republicans is the degree of control imposed on ordinary Americans. Republicans believe firmly in free people and free markets. They assume that ordinary people are mostly perfectly capable of managing their own affairs.

Democrats believe that people need to be managed. It’s more that they believe that the wise people who work in government are much more capable of doing the right thing, and telling others what to do.  Ordinary people cling to their bibles and guns (yes he actually said that), and need regulating. It can be called the totalitarian impulse. It begins with banning Big Gulp drinks, banning trans-fats, banning incandescent lightbulbs, and extends to managing your health care, your communication, and soon to extend to managing the energy you use. Progressives believe that the world can be improved if they just control every aspect of  your life. It’s not meant to be really noticeable. A ban on plastic bags here, a fee to visit a park, you cannot see your usual doctor — he’s not on the list, The little annoyances mount up until one day you wake up and realize just how intrusive the government has become.

Upward mobility is still there. The one thing you need to remember when presented with scary statistics about unemployment, inequality or economic mobility is that these are not the same people over time.

“Income inequality” sounds bad, but how do you make people equal? And is that a good thing? I don’t think so. The control freaks in government decided that we should not have electricity produced by coal-fired power plants. That has added thousands of people to the unemployment rolls. The government has invested millions in favored businesses like solar panels and wind farms, and the few that have not faced bankruptcy have only raised the cost of our energy. Government efforts to pick winners and losers result in failure.  The American people are perfectly capable of managing their own affairs without government help. If the government would just stop “helping”, things might turn around.