Last Sunday we reported a most encouraging article in the magazine section of the New York Times that speculated that the Democratic nominee for president might very well be prepared to champion the cause of the 99 percent and to right the inequality that currently exists between rich and poor (our cause) and is undermining the economy (and, consequently, our democracy), at least in the view of The Roosevelt Institute. Yipee!
This Sunday we may have to report the pendulum of the New York Times may be swinging in the opposite direction. In an article by Frank Bruni titled “Hillary’s Summer of Love” the author writes:
Dozens of prominent Republicans have come out and said that they’ll vote for her (Hillary) or consider it, including, just last week the Silicon Valley titan Meg Whitman, the Jeb Bush confidante Sally Bradshaw, and Maria Comella, a former spokeswoman for two of Trump’s most pugnacious promoters, Chris Christie and Rudy Giuliani.
You can expect the list to grow. . .
I envision a box of cigars to Collin Powell, long-stemmed roses for Condoleezza Rice, a brand-new smartphone for Senator Lindsay Graham. . .
For many months now, she has been sending signals that a second Clinton administration would differ from President Obama’s in the earnestness and aggressiveness of its bid for bipartisan cooperation. . .
What hasn’t happened, though, is the construction of a substantive, policy-based bridge across the aisle. She moved leftward during the primaries to deal with Bernie Sanders’s challenge, and many of her positions are anathema even to those who prefer her to Trump.
Does she change that over the next months or, if elected, upon taking office? Does she have to? There are some fascinating forks in the road ahead—some big decisions—all created by the singular mess of Trumps candidacy and the possibility, suggested in the latest polls, including one that showed her ahead in Georgia, that he’ll lose the election by a devastating margin.
It was a matter of principle when we first created this blog to deal strictly with economics and not to get involved with current politics which are ephemeral at best and can rarely look beyond the next election, candidate or poll. We apologize therefore for this lapse. It was the great hope raised in us by the Roosevelt Institute and its stalwarts, Felicia Wong, Joseph Stiglitz and Robert Reich that caused us to deviate. Let’s pray that their guess is right.
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Meanwhile we must report more bad news from this Sunday’s Times. In an article entitled “A Low-Growth World” Neil Irwin of the Times staff writes:
One central fact about the global economy lurks just beneath the year’s remarkable headlines: Economic growth in advanced nations has been weaker for longer than it has been in the lifetime of most people on earth. . .
This trend helps to explain why incomes have risen so slowly since the turn of the century, especially for those who are not top earners (the 99 percent).
The first step in reversing the slowdown is to understand why it is happening. One way to do this is to examine the predictions from smart economists. . .
So who does he go to as his authority? Just the man who had been invalidated for the inaccuracy of his economic vision in last Sunday’s Times article.
Larry Summers, the Harvard economist and former top official in the Obama and Clinton administrations. . .
[who, in November 2013,] combined those observations into a much-discussed speech at an I.M.F. conference, arguing that the global economy had, just maybe, settled into a state of “secular stagnation” in which there was insufficient demand, and resulting slow growth, low inflation and low interest rates. . .
Mr. Summers, in an interview, frames it as an inversion of Say’s Law, the notion that supply creates its own demand: Economy-wide, people doing the work to create goods and services results in their having the income to then buy those goods and services.
In this case, rather, as he has often put it, “Lack of demand creates lack of supply.”
In refutation, we quote from that earlier article on Hillary Clinton by Gideon Lewis-Kraus:
. . . there were two distinct factions in the Clinton White House: the free-market, centrist, “neo-liberal” wing with such figures as Larry Summers and Robert Rubin . . . and then people like Stiglitz. . . and Robert Reich. The Summers/Rubin wing largely prevailed.
But later on, referring to the recent rival Democratic presidential candidates, we read:
The fight between Clinton and Sanders often seemed like a choice between a repudiation of the long 1990s entirely (Robert Reich has been an outspoken Sanders supporter) or an avowal that this time the the party will choose the vision of Stiglitz. . . On the left, Stiglitz. . . is viewed, like Sanders, to have landed consistently on the right side of history.
Let us remind Mr. Summers and Neil Irwin, author of “A Low-Growth World,” of what Stiglitz said:
“Inequality isn’t the trade-off for economic growth; rather, it’s both the cause and the symptom of slower growth.”