Tuesday, May 08, 2007

Why Does Rove Ignore Income Distribution?

I think I have to agree with Brad DeLong about something, despite a good defense by Mark Thoma. I'm not going to take on the question of whether Stanley Fish is the Most Mendacious Man Alive, but I agree with Brad that Karl Rove does include in his conception of good economic performance some measure of how people other than corporate executives and owners are doing. The fact that Rove systematically neglects to discuss how average Americans have done economically over the past several years is therefore, I think, a lie by omission.

Lots of the statements in the speech by Karl Rove that Mark excerpts indicates that Rove knows that "economic health" includes some measure of how average people are doing. Examples:
  • "[I]n the three months following 9/11, the American economy shed 1 million jobs." The fact that he mentions aggregate job losses at all is an indication that Rove understands that what happens to average workers is an important part of the economic picture. He's not discussing the income losses to corporate executives and owners here - he's discussing a million average workers who lost their jobs, and making the point that that was a bad thing.

  • "The Bush tax cuts have shifted more of the burden onto the wealthy and those lower on the economic ladder have been relieved of a larger share of their tax burden... And the tax burden of the top 5 percent of those in America, those with incomes of lower than $141,000 a year, is up almost 3 percentage points." The fact that Rove includes statements like these seem to indicate that he knows that it matters what happens to the disposable income earned by people who are not among the very richest in the economy.

  • "The American economy has created more jobs than all the countries in the Euro zone and Japan combined... Employment is at near all-time high. Claims for unemployment insurance are at a five-year low. The unemployment rate is 4.7 percent; well below the average for each of the last three decades." Again, these aggregate labor market statistics would only be included in the speech if Rove believed (or believed that his listeners believed, at any rate) that the condition of the labor market for average workers is an important indicator of the health of the economy.

  • "President Bush believes trade is an important source of good jobs for our workers, higher growth for our economy, and bigger earnings for our farmers and our factories. For example, exports accounting for roughly one-quarter of all U.S. economic growth in the '90s, and jobs in exporting plants pay wages that are up to an average of 18 percent higher than jobs in nonexporting plants." Here's another example of Rove citing how economic progress (in this case due to trade, in Rove's argumentation) can be measured by creating jobs and higher wages for average workers.
Yes, I do believe that Rove thinks about how the economy is performing for average Americans. If he doesn't care about it personally (and I'm perfectly open to that possibility), then he certainly is smart enough to know that most people do think that economic progress has to include some measure of the well-being of average people.

The most convincing thought experiment for me is simply this, however: if median income was up a bunch in the last few years, don't you think that Rove would be advertising that fact as loudly as possible?

So why does Rove seem to ignore issues of income distribution? Simply because the results have not been good.

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