Back from Vegas

. . . .Where I discovered how exactly the big casinos were built. I didn't do too bad, really, but I certainly have yet to go there and come out (financially) ahead.

One of my favorite topics is economic inequality, and while we can probably agree that it's bad, my question is, what do we do about it? Raising taxes on the rich seems like a ham-fisted way of helping the middle class, and one that's likely to do more harm than good. Apparently, I'm not the only person that thinks so.

I'm going to BG this weekend for quiz bowl.

The Cost of Redistribution

This piece by Ezra Klein got me thinking. He argues that the wealthiest among us have "stolen" the productivity gains of the economy is bad and we should do something about it. I have always wondered how proponents of this line of thought propose to get people to pay $7 for a Big Mac because we raised the minimum wage to $11/hour, but that's neither here nor there.

My main question today is, is it not possible that the reason our economy has grown and recessions have gotten gentler over the past thirty years or so is that very inequality? Is it not possible that Paul Krugman's Great Compression is what was holding the economy back? Government redistributions have a cost; $1 in taxes costs the economy more than $1, and I propose that all that money we were spending on bureaucrats instead of people who actually produce something is the difference between the 50's and today. I'd love to see some serious analysis of this idea -- I'm not equipped to do it but it passes the smell test with me.

This blogging thing is hard. . .

I have been writing a lot of questions lately and getting ready for some fake quiz bowl next week, so apologies to the three or so of you who read this blog. You might want to use the RSS feed.

This post from Working Life hits home with me as someone who lost a job a few years ago and was eligible for (but never got; I got a new job first) TAA assistance. I am a little confused by the folks that are so against free trade. I am not sure how they think that their middle-class lifestyles will be maintained if you make the economy less productive than it already is, by closing the door to your customers. The United States is the world's largest consumer market, and every business in the world wants to sell their stuff here, but no government is going to open the doors to U.S. companies if our doors are closed to theirs.

So, I'm not sure how we save middle class jobs if we roll back free trade. If the American market isn't big enough to buy the things you want to sell (at high wages, remember -- prices will have to be raised), then all those great manufacturing jobs that we've created are going to go out of business in a hurry. I don't care how little the CEO makes -- no company that doesn't make money will employ workers at any wage for very long.

In response to the distorting effects of farm subsidies that one commenter brought up, you won't see me defend them. That, and the very interesting post about education that the sociology professor posted, I'll deal with another day.