
You may know about Third Way. It is a supposed centrist party that doesn’t fall into the trap of the supposed extremist Democratic and Republican parties. The problem is that when they talk about policy, it turns out that it is what the Democratic Party establishment already supports. Now this is an indictment of the Democratic Party, because it shows that it is not liberal, at least on economic issues. But the reason that Third Way doesn’t just get behind the Democratic Party is that they aren’t really for centrist policy. Instead, they are professional centrists who get their gravitas by pretending to be the mean between the two extremes. They have never been able to explain how the modern Democratic Party is extreme, except in that the Republicans say it is and that they disagree in some small ways.
Over the weekend, the top two people at Third Way, Jonathan Cowan and Jim Kessler, wrote an OpEd in The New York Times, Capitalize Workers! They argue that low wage workers don’t need no stinkin’ minimum wage increase. What is really behind income inequality is that low wage workers aren’t vested in the stock market. So they propose forcing employers to pay 50¢ per hour into a private investment account for employees. They claim this will result in an annuity worth $790 per month at retirement.
Note first how they frame the debate in a way that appeals to their base: the business interests. Raising the minimum wage would actually move money from corporate profits to worker wages. But forcing employers to add 50¢ to every hour worked would end up getting taken out of the employee wages. So this is a way of just forcing workers to invest some part of their earnings and not requiring anything from employers. Note also: all of the proposals to raise the minimum wage are a lot more than 50¢ so even at its best, this proposal is yet another attempt by economic conservatives to do as little as possible to help low wage workers.
But it’s much worse than this. Dean Baker goes through all the numbers and shows that the annuity would be far less—perhaps only half as much. And it is a huge giveaway to Wall Street. It represents between $25 and $50 billion per year in fees for the investments. And then another $25 to $50 billion for turning the investments into annuities at retirement.
Last December, the same two men were at The Wall Street Journal arguing, Economic Populism Is a Dead End for Democrats. So they are very much aware that Obama and the Democratic establishment push policies that are effectively identical to their own. And they are afraid that populism of the Warren and de Blasio type might break out—because they would be bad for their corporate base. So it is clear where they are coming from.
Sadly, the media generally treat Third Way as though it had something useful to say. But this goes back to a point I’ve argued for a long time. Elite media figures are upper class urbanites. They see their interests represented by third way: economic conservatism and social liberalism. Of course the actual people of the country are the opposite; they are economic liberals and social conservatives. And that’s why the Third Way boys push this investment nonsense: it’s a great way to confuse people into thinking that the government is doing something for the working poor, when it is actually just stealing money from them.
This morning I saw that Jonathan Chait had a new feature in New York Magazine. Normally, that is something to celebrate. He’s an excellent writer with a lot of great insights. But this article was,
It is kind of hard to get to the bottom of the article. It’s something like this. The very basis of the Republican Party is racism. Pretty much everything they do has racist motivations to one extent or another. But talking about this just makes the Republicans claim that all accusations of racism are invalid. So we shouldn’t criticize them for their racism or the criticisms we don’t level against them won’t be effective. Or something. It’s hard to say.
Not surprisingly, the article is being eaten alive by liberals. Ed Kilgore wrote,
The most vicious attack against Chait comes from Joan Walsh, 

I’m still not clear what exactly Ezra Klein’s project is, but he has now published a very interesting article,
For many people in my life, I am the person to come to in order to determine what smart opinion is on a subject. This is cultural identification in its best sense. After all, there is a whole lot of noise out there and they know me and they know that I am honest. Even on issues that I have very strong opinions, I provide the opposing position. Because I am a scientist by nature, I don’t just provide the information that confirms my side. That doesn’t mean that I’m objective—just that I try to provide a full, if ideologically colored, picture.
For roughly the last week,
I caught a bit of 60 Minutes tonight. They did an interesting and even inspiring story,
What was I going to do? Talk about geneticist James Watson? I’m trying to rid myself of people with really vile opinions. And his attitude toward the great geneticist Rosalind Franklin is totally unacceptable. And let’s face it, Watson and Crick were not that great. They were the first of many who were very close to doing the same thing. They also stood on the shoulders of many great scientists who went before them. So James Watson? No no no!

In recent years, Joseph Stiglitz has focused on the issue of income inequality. And last week, he testified before the Senate Budget Committee. The topic was,
Warren Buffett famously noted that his secretary paid a higher income tax rate than he did. It was a good illustration of the reason we have such high income inequality in this country. As one goes very high in earnings, one’s tax rate goes down. This is primarily because we don’t tax capital gains as much as we do earned income. The government is implicitly saying that owning is more valuable than working. Yes Virginia, we have a very screwed up country.
Listen up everyone! It is 