Megan McArdle At Bloomberg: ‘Piketty’s Tax Hikes Won’t Help The Middle-Class’

Full piece here.


‘If we look at the middle three quintiles, very few of their worst problems come from the gap between their income and the incomes of some random Facebook squillionaire. Here, in a nutshell, are their biggest problems:

-Finding a job that allows them to work at least 40 hours a week on a  relatively consistent  schedule and will not abruptly terminate them.

-Finding a partner who is also able to work at least 40 hours a week on a relatively consistent schedule and will not be abruptly terminated.

-Maintaining a satisfying relationship with that partner over a period of years.

-Having children who are able to enjoy more stuff and economic security than they have.

-Finding a community of friends, family and activities that will provide enjoyment and support over the decades.

This is where things are breaking down — where things have actually, and fairly indisputably, gotten worse since the 1970s. Crime is better, lifespans are longer, our material conditions have greatly improved — yes, even among the lower middle class. What hasn’t improved is the sense that you can plan for a decent life filled with love and joy and friendship, then send your children on to a life at least as secure and well-provisioned as your own.’

There are serious forces at work in our society right now, from high-rates of technological change and many areas of rapid scientific advancement, to many political, social, and cultural effects as a result. Global market forces continue to apply downward pressure across many industries and sectors of our economy, as they have for many years, altering the kinds of decisions people must make in their daily lives.

Is inequality so bad that we need a ‘global wealth tax’?

I’m someone fairly convinced that American progressive politics and Left-liberalism, in the long-run, generally leads to less opportunity for greater numbers of people, less overall wealth, and more social stratification. It’s a fast-track to many of the problems that many European societies and their governments face:  Sclerotic, slow-growth economies, deep structural debt and lower birth-rates.

In America, such an approach seems a sure way to grow a deeply wasteful, unresponsive, over-promising and under-delivering government which fails to protect and serve the kinds of everyday people that have made our country so remarkable. In practice, I imagine this looks more like De Blasio’s coalitions in New York City:  Labor activists are quite good at moving tax-revenue and labor activists around, while searching for the right cronies and monied interests to help fund their efforts and realize their aims. This can burden our institutions with impossible demands and a narrow coalition of interests working under what is presumed to be a universal idealism, making our politics deeply contentious and bitter as we fight over scarce resources (including political power).

As McArdle points out, challenging and/or rewarding work and career opportunities, more money and perhaps a little time to maintain the love and family lives that are often at the heart of so much of what we do…this is a good place to focus the debate. In my opinion, this requires broad economic growth and a private sector outgrowing the public sector, and many other things besides.

I’m hardly encouraged by our politics right now, either side really, but I think we can do so much better than this.

Any thoughts and comments are welcome.  Let me know what I’ve got wrong.

5 thoughts on “Megan McArdle At Bloomberg: ‘Piketty’s Tax Hikes Won’t Help The Middle-Class’

  1. You got everything right. Now, do you know anyone important (person or organization) who can change situation for the better?

    • JF,

      Thanks for stopping by.

      Well, I know of many organizations doing their own things, like FIRE in Higher Ed pushing back against the discontents of Leftist excess, CATO for libertarian economics. Conservative and libertarian and non-Leftist and collectivist liberals publications, institutions and coalitions are all over the place.

      The rest of it is going on in debates in the public square, our politics and in our culture.

      I wish I could give you more than that, but I’m just a lone blogger at this point.

      • Thank you. I wonder if there was a strong reaction to Rutledge University and Brandeis University decisions from any organization on the right.

      • Hopefully that helps somewhat. Let me know if you find anything too.

        What’s disturbing is that it isn’t a mainstream reaction, but one relegated to a minority, a plurality, or even avowedly political groups.

        I was hoping that reasonable courage instead of such cowardice would be the norm, not the exception.

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