Hillary's short history of inequality is too short

A few weeks ago, I contrasted Elizabeth Warren's critique of income inequality in America with Obama's. The critiques are substantively similar, laying primary responsibility for the widening wealth and income gaps on Republican tax, labor and regulatory policy and citing similar stats showing that virtually all productivity and output gains over the last several decades have gone to the wealthiest. But Warren is more laser-focused on Republican and Wall Street malfeasance: Obama acknowledges contributing causes as diverse as global competition and domestic racism. And interestingly, where Obama cites four stats to illustrate the growing gap, Warren concentrates her fire with one pair:

Since 1980, how much did the 90% get of income growth in this economy -- from 1980 to 2012, the 90% got zero. None. Nothing.

Zero. None. Nothing. You could hang a campaign on that, no?

Now what about Hillary Clinton, who officially kicked her campaign off with a speech on Roosevelt Island yesterday?

Molly Ball points out quite rightly that Clinton is being credited with a more full-throated populism than she voiced:

The conversation shifts toward wages

If I may indulge myself in a quick note at a busy time: today's lead NYT editorial marks a kind of watershed to me.  Aptly titled Picking Up the Tab for Low Wages, it begins by noting the divergence between productivity gains and wage gains since the 1970s and then alleges a primary cause:

These dynamics are not inevitable. Low-wage employers, in particular, pay low wages because they can and the main reason they can is that Congress has failed, over decades, to adequately update the minimum wage and other labor standards, including rules for overtime pay, employee benefits and union organizing.

Reagan Revolution rollback

Here's how Matt O'Brien, the Washington Post/Wonkblog economics reporter, characterizes Obama's new tax proposals:

The state of the union is pretty good, actually, but President Obama has an idea to make it better: taxing Wall Street and the super-rich to make middle-class work even more worthwhile. It's Piketty with an American accent.

Okay, that's a little bit of an exaggeration, but not a huge one. Obama's State of the Union, you see, will call for $320 billion of new taxes on rentiers, their heirs, and the big banks to pay for $175 billion of tax credits that will reward work. In other words, it's fighting a two-front war against a Piketty-style oligarchy where today's hedge funders become tomorrow's trust funders. First, it's trying to slow the seemingly endless accumulation of wealth among the top 1, and really the top 0.1, no actually the top 0.001, percent by raising capital gains taxes on them while they're living and raising them on their heirs when they're dead. And second, it's trying to help the middle help itself by subsidizing work, child care, and education.

Stepping back, it's amazing the extent to which Thomas Piketty's tome Capital in the 21st Century, published in the U.S. in January 2014, has focused the U.S. policy debate on income inequality. Some economists have been talking about rising inequality since the 1980s, but Piketty and his colleague Emmanuel Saez have more recently put the spotlight on the very top -- the top 1%, .1% and .01% (they first published major findings pointing that way in 2003, but post-crisis updates have been making news in recent years). The book put the trends on the front pages. Now Democrats, after a rather disastrous pause to protect red-state senators in the 2014 election, are putting inequality front and center in their policy proposals.

It's the wages, stupid

"I'm no economist," to paraphrase Republican presidential hopefuls. But even a casual reader knows that for 35-odd years the lion's share of economic growth has gone to the wealthiest, and that the trend has accelerated in the last decade.

We're told, e.g. by David Leonhardt, that arresting the trend and creating wage growth is a gigantic mystery, and that Democrats, ostensibly the party of the less-than-wealthy, can only nibble around the edges, as with middle class tax cuts. That is, get GDP growth out of near-neutral and wage pressure will rise.

Now cometh billionaire Nick Hanauer, this generation's class traitor extraordinaire, to call bullshit and place the spotlight squarely on labor law and deliberate policy choices that have eroded workers' leverage vs. owners.  His focus is on wages -- specifically, in the piece below, on overtime pay. You can extrapolate and imagine a party that focuses relentlessly on the rules governing pay and workplace rules. I'm quoting an extended chunk here because I want to add my drops to the ocean, i.e. get a few more people to read this: