Trickle Downers

The Prospect's ongoing exposé of the folly, dysfunctions, and sheer idiocy of feed-the-rich economic policies.

Tax Cuts for the rich. Deregulation for the powerful. Wage suppression for everyone else. These are the tenets of trickle-down economics, the conservatives’ age-old strategy for advantaging the interests of the rich and powerful over those of the middle class and poor. The articles in Trickle-Downers are devoted, first, to exposing and refuting these lies, but equally, to reminding Americans that these claims aren’t made because they are true. Rather, they are made because they are the most effective way elites have found to bully, confuse and intimidate middle- and working-class voters. Trickle-down claims are not real economics. They are negotiating strategies. Here at the Prospect, we hope to help you win that negotiation.

Trickle Downers

Rising Inequality Is Far From Inevitable

AP Photo/Teresa Crawford
AP Photo/Teresa Crawford Solo Littlejohn, a fast food worker from Cicero, Illinois, joins protesters calling for a union and pay of $15 an hour outside a McDonald's restaurant in Chicago on Thursday, April 14, 2016. An earlier version of this story appeared in The Boston Globe. T he latest study of deepening inequality by three of the most careful scholars of the subject, Thomas Piketty, Emmanuel Saens, and Gabriel Zucman, has prompted another round of shrugs from economists that inequality is just in the nature of the advanced economy. Supposedly, these inexorable trends reflect technology, globalization, and increasing rewards to more advanced skills. The poor are paid in correct proportion to their contribution to the national product, which alas, isn’t much. A close look at political history suggests that this widespread inference is convenient nonsense—convenient to economic elites. In fact, the distribution of income and wealth has bounced around a lot in the past century and a...

Is Minnesota the Next Target for GOP Wage Suppression Laws?

A conservative ALEC legislator threatens to block local minimum-wage hikes.

AP Photo/Jim Mone
AP Photo/Jim Mone Representative Pat Garofalo speaking on the floor of the Minnesota House of Representatives. T he state of Minnesota—long a liberal bastion of the upper Midwest—could be the next target for the right’s nationwide effort to block any minimum wage increases by cities like Minneapolis that are higher than the state’s minimum of $9.50 an hour. In the months before the November election, progressive advocacy groups and a majority of the Minneapolis city council were pushing for a $15 minimum wage. Minneapolis Mayor Betsy Hodges opposed it, however, saying she would prefer it if Democratic state legislators passed a bill mandating a higher regional minimum wage for the Twin Cities metro area instead. However, Election Day changed that political calculation when the Minnesota GOP expanded its majority in the state House ( with help from the Koch brothers ) and, in a huge upset, wrested control of the senate from the Democratic Farmer-Labor Party (the state Democratic party...

An Alternative to Puzder

Fast-food CEO Andy Puzder, Donald Trump’s pick for labor secretary, is a big fan of robots—and not so much of humans. In an interview with Business Insider last March, Puzder had this to say about our robotic little friends: “They’re always polite, they always upsell, they never take a vacation, they never show up late, there’s never a slip-and-fall, or an age, sex, or race discrimination case.”

Correspondingly, Puzder’s record makes clear that the wants and needs of human workers repel and disgust him. He’s opposed increases to the minimum wage, and the extension of overtime eligibility to workers making more than $23,000 a year. His fast-food outlets have been penalized for violating minimum-wage laws. And as his Business Insider disquisition makes clear, things like employee vacations and slipping on the job—things that come out of Puzer’s profits, that is—drive him batty.

When the Senate convenes in January to consider Trump’s cabinet nominations, it might be prudent for the solons to apply Puzder’s tests for human frailty to the nominees—at minimum, to Puzder himself. Is he always polite? Has he been known to take vacations? Or slip? Or fall? If so, wouldn’t a robot do a better job? Any robot programmed to become labor secretary, after all, would likely understand better than Puzder that its mission is to advance rather than retard the interests of American workers.

The senators should heed Puzder’s advice: Reject his nomination and petition Trump to send them a robot, which, by any criterion, including that of human empathy, would be more qualified than the current nominee. 

What Economists Learned in 2016 -- Long After Everyone Else

Alex Milan Tracy/Sipa via AP Images
Alex Milan Tracy/Sipa via AP Images Protesters gathered outside a World Affairs Council meeting on the Trans Pacific Partenership with the U.S. Ambassador to Brunei in Portland, Orgon. T his week, Bloomberg’s Noah Smith published a list of “ten excellent economics books and papers” that he read in 2016. Number three on his list was the now celebrated paper, “The China Shock: Learning from Labor-Market Adjustment to Large Changes in Trade,” by economists David Autor, David Dorn and Gordon Hanson. Here’s Smith’s summary of the work and its consequences: This is the paper that shook the world of economics. Looking at local data, Autor et al. found that import competition from China was devastating for American manufacturing workers. People who lost their jobs to the China Shock didn’t find new good jobs—instead, they took big permanent pay cuts or went on welfare. The authors also claim that the China Shock was so big that it reduced overall U.S. employment. This paper has thrown a huge...

Larry Kudlow: Trickle Downer of the Week

Trump may tap cable news’ most diehard devotee of supply-side policy as his top economic adviser, cementing his administration’s adherence to a malicious scheme. 

(Photo: AP/Seth Wenig) Kudlow speaks at the New York State Republican Convention in 2014 I f we needed a clearer signal that Donald Trump’s administration will go all in for amped-up trickle-down economics—that is, tax cuts for the rich, deregulation for the corporations, and wage suppression for everyone else—consider that the president-elect is likely to tap Larry Kudlow to chair his White House Council of Economic Advisers. For those who aren’t familiar with him, Kudlow is a prolific cable news commentator who has a stellar reputation for being wrong—a lot. Like, a lot a lot . Given that he has no formal education in economics, Kudlow also neatly fits Trump’s preference for putting “unconventional” people (i.e., he sees them frequently on cable news) to top White House posts. As David Dayen aptly puts it in The Nation , “Kudlow isn’t an economist, but he plays one on TV.” To put a sharper point on it, he plays a trickle-down economist on TV. As a ubiquitous talking head, Kudlow is...

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