Henningsen: An Unfairness Index

Dec 19, 2017

The so-called tax reform law reminds me of a nightmarish revision of Robin Hood, with the Sheriff of Nottingham skillfully manipulating the good citizens of Sherwood into believing his rapacious policies will actually benefit them.

And while it may seem odd that Congress would pass legislation privileging the wealthy donors and big corporations of the 1%, it’s not hard to understand why.

Tax cuts seem appropriate to many who are disinclined to read the fine print. After all, the economy seems in good shape, unemployment is down, and the immediate future looks like clear sailing. A bit of extra cash feels good – no wonder it’s popular. That the benefits are short-term seems not to matter to those Americans who tend to think only in the short-term.

And as Jacob Weisberg of Slate has observed, this is a win-win for Republicans: they can deliver short-term benefits to lower earners, who’ll vote for them in the midterms, and ignore the long-term budget-busting aspects of their work, leaving it to Democrats to clean up later - which will require unpopular measures like raising taxes - making it easy for the GOP again to campaign as the party of fiscal restraint and responsibility.

And let’s be clear: most Americans are comfortable with income inequality. Capitalism begets winners and losers; that’s the way the free market works. Americans assess economic policy by where they intend to be, not by where they are at any given moment. To them policies that erect obstacles to their intended progress – or threaten to - are by nature bad.

But Americans have little tolerance for economic unfairness – for policies of betrayal, rigging the game or stacking the deck – and Democrats have been missing this point. They might consider using the stock market as an “unfairness index”. When the market is up, the little guy profits a bit while the big operators rake it in; when it’s down, little folks lose big, while fat cats are largely cushioned against major losses. Most small fry haven’t yet recovered from the ’08 crisis, but the “too big to fail” gang is doing better than ever.

Some listeners will regard this theory as oversimplified, inaccurate, and misleading.

But Bernie Sanders ran on it.

And so did Donald Trump.