Product Description
Unequal Democracy debunks many myths about politics in contemporary America, using the widening gap between the rich and the poor to shed disturbing light on the workings of American democracy. Larry Bartels shows that increasing inequality is not simply the result of economic forces, but the product of broad-reaching policy choices in a political system dominated by partisan ideologies and the interests of the wealthy. Bartels demonstrates that elected officials respond to the views of affluent constituents but ignore the views of poor people. He shows that Republican presidents in particular have consistently produced much less income growth for middle-class and working-poor families than for affluent families, greatly increasing inequality. He provides revealing case studies of key policy shifts contributing to inequality, including the massive Bush tax cuts of 2001 and 2003 and the erosion of the minimum wage. Finally, he challenges conventional explanations for why many voters seem to vote against their own economic interests, contending that working-class voters have not been lured into the Republican camp by "values issues" like abortion and gay marriage, as commonly believed, but that Republican presidents have been remarkably successful in timing income growth to cater to short-sighted voters. Unequal Democracy is social science at its very best. It provides a deep and searching analysis of the political causes and consequences of America's growing income gap, and a sobering assessment of the capacity of the American political system to live up to its democratic ideals.
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 Politics Matters ( ralbin )
This very interesting book is an exploration of the nature of American politics and its relationship to inequality in the USA. Bartels summarizes a great deal of his own work and considerable other work on these topics. Bartels begins by demonstrating the marked increase in economic inequality characteristic of the last three decades. He then goes on to present reasonable evidence that a major determinant of rising inequality is who controls the Federal government, particularly the White House. Under Democratic Presidents, overall growth tends to be higher overall and particularly higher for the lower class and middle class; under Republican administrations, upper class, especially very wealthy individuals, tend to be very strongly favored. Bartels explores the basis for these effects, which he finds to be rooted in a combination of tax policy and macroenomic policies favored by the different parties. Given the marked difference in the consequences of electing Democratic and Republican presidents for the considerable majority of Americans, why have Republican Presidential candidates been so successful in the past 3 decades? Bartels effectively attacks the notion that "cultural issues" like abortion access are key to Republican success. He presents data attesting to the salience of class based economic issues. Republican success is particularly surprising in view of data Bartels presents indicating that Americans as a group generally express somewhat egalitarian sentiments.
The answer to this question is that a combination of factors tend to favor Republican candidates. What Bartels refers to as voter myopia is a major factor. While Presidential elections function as referenda on economic management, voters focus on economic performance in the election year, not on the whole prior Presidential term. In the past 30 years, this has tended to favor Republican candidates. This is partly luck, though for the case of the 1972 election, it is believed that Fed Chairman Arthur Burns manipulated interest rates to assist Richard Nixon. The apparently irrational tendency of voters to judge economic performance by the relative success of the upper class also assists Republicans, as does the fact that affluent, more Republican, voters tend to provide more financial resources for campaigns.
These vagaries of voting behavior are examples of how our political system fails to translate public sentiment into actual policy. Bartels provides 3 further examples of such failures. Tax cuts, the estate tax, and failure to keep the minimum wage current with inflation all represent situations in which public policy does not reflect well established public opinion. Bartels has some useful discussions of prior literature addressing these kinds of failures of our political system. Bartels also presents data arguing, at least for the US Senate, that the opinions of lower class voters have little impact on policy formation. The ultimate conclusion is that we have less a democracy than a form of oligarchy, and one slanted heavily towards the affluent.
This is generally a well written and well argued book. It is, however, a bit uncomfortably in between a purely scholarly monograph and a truly popular book. Its excellent that Bartels present so much of his analysis and data, but there is no methodological explanations. Given that he apparently wanted to reach a fairly wide audience, a methodological appendix describing his datasets and methods would have been useful, including limits of methods. Multivariate linear regression seems to have been a major tool and an important limitation is that this is essentially a correlational method. Bartels' analyses seem reasonable and generally convincing but some are arguable. At one point, he argues for the importance of ideology in voter interpretation of economic inequality, suggesting that both well informed liberal and conservative voters are biased by their ideological convictions. Given the data presented on inequality, its equally plausible that well informed liberal voters are actually more objective about the present state of affairs than well informed conservative voters.
A final corollary of Bartels' work is that the behavior of elites matter tremendously. This is perhaps where the combination of self-interest and ideology divorced from reality can have its most destructive effects.
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Facts everyone should know ( jmills@hawaii.edu )
"Unequal Democracy" is a tough read for the average reader. Half-page footnotes and statistics usually put people off. But I wish I could require all our government officials and even all voters to read this book. The research is solid and the conclusions important to the future well-being of our democracy. I was particularly impressed by the cross-testing he did to check his assumptions. I recommend this to all my college students and to all serious readers. (You can skip the footnotes if you like.)
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 On Spreading the Wealth ( ivangaalenatyahoodotcom )
In this study Princeton professor Larry Bartels makes the argument that lower- and middle-income groups consistently do better under Democratic administrations than under Republican. During the last sixty years (1948-present) the average annual growth of real GNP was 1.64 percent per capita under Republican presidents and 2.78 percent under Democratic presidents. He shows further that income inequality has gone sharply upward during Republican administrations and slightly downward during Democratic. Inequality has gone up significantly since 1980, years in which Republicans have won all but two presidential elections. He calls this the "new gilded age" because the top 1 percent now controls 20 percent of the wealth, a percentage not seen since the 1920's. Perhaps another sign that the economy is out of balance and heading for greater turbulence.
Republican economists will argue that this is merely a statistical aberration. They claim that presidents have little influence over the economy, and other forces such as monetary policy, oil prices, and technology are more determinative. Republicans view the market as a force of nature, whereas Democrats see it as a political construct. Bartels, being a Democrat, makes a strong case for government intervention to achieve greater balance and greater income equality.
Bartels shows that Democratic presidents have consistently produced their best results during their second year in office. This is because the spending programs put in place the first year usually produce their benfits the second. Not suprisingly income growth was virtually the same for both parties the first, third, and fourth years. The second year surge seems to have given Democrats the edge.
The question that comes to mind is that if Democrats are producing higher income growth and greater equality why did Republicans win 5 of the last 7 presidential elections? Bartels' answer is that the benefits of the second year are no longer part of the voter's consideration by the time elections roll around. Also by the fourth year Republican presidential candidates are making populist election year promises that make them indistinguishable for Democratic candidates. (Which party now is not in favor of bailouts and stimulus packages?)
Bartles makes an interseting argument. He argues that for those looking out for their economic interests it is not only important for Democrats to vote Democratic but Republicans - other than the top 1 percent - should also be voting Democratic. (Joe the Plumber included.) The upcoming presidential elections will probably prove Bartels theory correct.
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Everyone Makes More Money When a Democrat is President
A couple of things jumped out for me:
"comparing average annual real pre-tax (1) income growth (%) for families at various points in the income distribution" from 1948-2005:
-- First, everyone made more money under Democratic presidents, although the difference was small for the wealthiest (95th percentile).
-- Under Republicans, the wealthy do a lot better (2.12% increase per year for the 95th percentile) than those with less (0.43% increase for the 20th percentile).
-- Under Democrats the middle class, working class, and poor do a little better than the rich (2.38-2.64% increase compared to 2.12% for the 95th percentile).
Because these are percent per year, they compound. Over time Democratic presidents have narrowed the income gap whilst making everyone wealthier. Republican presidents have significantly widened the income gap and even the wealthy make less than under Democrats.
Bartels spends many pages showing that this is not a statistical fluke or the product of other factors. He also explains why each party's tax and fiscal policies lead to what we observe. This is a real effect of the party in power.
[...]
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 Bartel's analysis oversimplifies
It's no coincidence that Larry Bartels is a political scientist -- not an economist. His book purports to show that American economic performance under Democratic administrations has been superior to performance under Republicans, across all income categories.
Apparently, this chart has a lot of liberals very excited. Too bad that it is complete nonsense.
Bartels grossly oversimplifiwa how economic policy actually impacts economic performance. The root of its problem lies in the inane assumption that the effect of policy on economic growth manifests itself with a one year lag. In other words, Bartels gives a political party credit for economic performance starting the year following it takes over the Presidency.
Let's explore this assumption. A president comes into power. By the time his first budget goes into effect, it is already October of that year. Does anyone really think that that initial budget has any signifiant impact on economic performance of the following year? And that only the budget is responsible for that economic performance?
Just to show the arbitrary nature (and impact) of the one year lag assumption, I ran growth numbers for a *two* year lag based on Bureau of Economic Analysis data, from 1945 to 2007. In that time period, average economic growth (for all income categories, to keep it simple) resulting under Democratic adminstrations was 2.02%. From Republican administrations, 2.08%.
The other major assumption that the study ignores is that it is Congress, not the Presidency, that holds the power of the budget. Asking who controlled Congress and what those policies were has just as much (or more) bearing on economic outcomes as who was in the White House. Similarly, the Fed controls monetary policy, which potentially has a greater economic impact that fiscal policy. Who has appointed the Federal Reserve Chairman and its Board of Governors? Are they employing a conservative or liberal ideological approach to monetary policy?
Additionally, Bartels' "analysis" just completely ignores history, again by making foolish assumptions about the data lag. For example, it's pretty widely accepted that the economic downturn and stagflation of the early 1970s was proximately caused by the financial demands of the Great Society and the Vietnam War, coupled with exogenous shocks to oil prices. Both the Great Society and America's deep involvement in Vietnam came courtesy of LBJ. So you can'tgive Nixon credit for bad economic performanceon his watch - the causes of rampant inflation and low growth at the time weren't his fault.
In the final analysis, the success of economic policy of respective Democratic and Republican administrations must be evaluated based on their long term impact. This is very difficult to measure because there are so many dfferent factors at work -- fiscla policy, monetary policy, technological innovation and impact on productivity, population and demographic change, commodities avilability, trade, etc.
Behind this complexity, however, the fact remains that basic economics tells us smaller government, lower taxes, and less wealth redistribution results in a larger pie for everyone. Nothing in the Bartels' "analysis" as should cause a rational observer to doubt that simple fact. If there's any doubt of this, compare the long term growth rates of the US versus Europe. Freer markets, smaller government, and lower taxes inevitably produce higher growth, lower unemployment, and lower inflation in the long run. If there's any doubt, here's a fact from a recent speech from the President of the European Central Bank, Jean-Claude Trichet:
"Since 1996, the annual growth rate for the euro area has averaged 2.1% per year compared to 3.3% in the US."
The speech goes on to propose structural reforms in Europe to increase competition and promote innovation (including tax reform and labor market reform) -- the fundamentals of conservative economic doctrine.
http://americangerontocracy.wordpress.com/2008/04/05/better-economic-growth-under-the-democrats/
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