Two points with regards to things I've heard Rep. Paul Ryan say in recent days.
First, he's downplayed the increase in income inequality that's gotten a lot of play out of the new CBO study. His claim is that there's enough mobility in the American economy to offset any increase in inequality.
I examine that claim in some detail here but to summarize, imagine the income scale as a hotel with floors that improve as you go up. The basement is funky; the penthouse, sublime. Rep. Ryan's argument is that sure, the distance between the floors may have grown -- with increased dispersion of incomes, there's a greater economic distance between the top and the bottom -- but the rate at which people move between floors has accelerated.
Except for it hasn't. There is no evidence that the rate of mobility has increased -- there's some evidence that it's slowed (though other evidence shows no change). In fact, according to mobility data covering a few decades, relative to their cohort (families in the same age range), most families end up close to where they started in the income scale, i.e., either in the income fifth in which they started or in the one either above it or below it (see tables 1-2 here).
Second, in a radio interview this AM I heard Rep. Ryan claim that the Republicans on the deficit reduction super-committee were in fact putting revenues on the table. That surprised me since I'd thought they'd pledged to stonewall on that point.
Well, according to this report most of what they're calling revenues are not what the Democrats, including the president, are thinking about -- we're not exactly talking shared sacrifice here:
"...about $440 billion appears to be generated instead by increased government fees, high patient co-pays under Medicare, for example, or increased Part B premiums charged to higher income beneficiaries -- many changes that Democrats also accept but feel do not address the larger tax issue.
On the tax side, changes in the CPI would again yield some revenue, but the greater share of the tax revenue here -- about $200 billion -- is attributed to the impact of future tax reform spurring economic growth."
This kind of spinning is precisely what makes people throw up their hands in disgust re American politics. It's a main reason way Rep. Ryan's institution -- the Congress -- has a 9% approval rating. And remember, if you're all about less government, regressive tax cuts, unleashed corporate power, less regulation, more privatization, YOYO economics (you're on your own), you want people to tune out.
So I say let's piss them off and tune in!
This post originally appeared at Jared Bernstein's On The Economy blog.
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