When a Republican congressman slumped into his committee chair last month after a sojourn home, a colleague asked him what it was like back in the precincts.
Terrible, came the weary reply. “I feel like a free-market economist in Cuba.”
Working people are restless, in other words, and although his eastern-seaboard district is upscale it is not a “safe” Republican district, not this year anyway.
Iraq and terrorism may be what grab voters’ attention this election year simply because the news makes them inescapable, but there is a meaner distemper at work in the electorate. Most people are worse off than they were six years ago, and despite the boasts about tax cuts and economic growth they know it. The median wage for American workers adjusted for inflation has fallen and the inequalities in wealth have widened dramatically.
Lots of money has been sloshing around in the economy but a smaller and smaller share of it is going to working families. As the New York Times reported Monday, wages and salaries make up the smallest share of gross domestic product since the government began compiling the data in 1947 — their part has dropped 5 percent since George W. Bush became president — and corporate profits have risen to their highest share since the 1960s.
Bush’s new Fed chairman, Ben S. Bernanke, warned last week that the country had to do something about the growing inequality and that the government should take steps to see that more of the wealth shook down to workers who created it. But his words fall on deaf ears in this administration and this Congress.
The president’s new treasury secretary, Henry M. Paulson Jr., said the other day that people are in a funk all right and wealth disparities are growing but it is not the Bush administration’s fault, or any administration’s fault for that matter, or any political party.
Even more comforting were the words of Frank Luntz, the Republican consultant who came up with the name “death tax” 15 years ago to help the rich and the GOP kill the estate tax. Luntz said people were obviously unhappy because they did not see the nation’s prosperity reflected in their weekly paychecks, but he said Republicans need not worry because voters blamed American corporations, not the Republican-controlled government.
After all, this is the government that has slashed taxes over and over.
But people are finally getting it about those tax cuts. They are getting it in Arkansas, where the president’s approval rating, once so high, has settled at 35 percent or so, and they are getting it in Pennsylvania and Ohio, where things are not quite as bad.
While the tax cuts were indeed large — costing the government $2.4 trillion between 2001 and 2010 by the newest calculations of Citizens for Tax Justice — they’re not much help for individuals in meeting higher fuel, energy and health costs unless you’re in the top 5 percent of income.
Arkansas provides one of the bleakest examples in the country.
For the poorest 20 percent of Arkansas income-tax filers (not including the very poor who do not file), their tax cuts over 10 years will average a grand total of $280. In other words, about $28 a year.
But the top 1 percent of Arkansas earners, whose average income is $764,900 a year, does better. Bush and the Republican Congress handed them an average of $319,658 in tax cuts cumulatively over the 10 years.
For the next top 4 percent of Arkansans, those averaging $173,300 in annual incomes, the 10-year tax cut is a respectable $30,700. They can abide three-dollar gasoline.
For the other 95 percent, it is a wash or worse.
The lopsided tax cuts are not the cause of the growing income inequality, not the major one anyway, but they are the clearest emblem of the whole range of fiscal, monetary, trade and social policies that consider the interests of only the upper crust.
Foreign policy, the most reckless in all of U. S. history, follows the same line. The middle class and poor carry the horrible burdens of war — blood and debt — while the vast spoils go to narrow interests, the major oil companies and the growing class of unscrupulous contractors and consultants.
The Bush administration seems to be developing a strategy to help troubled Republican candidates this fall: Remind people that they are in some ways better off than they were three years ago. The stock indexes are up (only a few hundred points below where they were when Bush took office in the case of the Dow), a few jobs have been created recently and total wealth is rising. How can you beat that?