Dangerous Rhetoric

The NYT has a piece about the new strategy for Democrats. This new strategy was highlighted by the way (and who delivered) the response to the President's State of the Union. Jim Webb used his platform to cite his favorite populists, Andrew Jackson and Teddy Roosevelt. He also repeats John Edwards ridiculous claim of two Americas with the following:

"When one looks at the health of our economy, it's almost as if we are living in two different countries. Some say that things have never been better. The stock market is at an all-time high, and so are corporate profits. But these benefits are not being fairly shared. When I graduated from college, the average corporate CEO made 20 times what the average worker did; today, it's nearly 400 times."

While I agree that not all CEOs deserve the pay they get. However, who are we to judge other people. The people who lose when CEOs have big pay days are stockholders. Why should we care if stockholders lose? We should not be fooled by populists who think poor people would be paid more if CEOs were paid less. Next, Mr. Webb cites inequality:

"Wages and salaries for our workers are at all-time lows as a percentage of national wealth, even though the productivity of American workers is the highest in the world. Medical costs have skyrocketed. College tuition rates are off the charts. Our manufacturing base is being dismantled and sent overseas. Good American jobs are being sent along with them."

Here, Mr. Webb uses the old labor economist's argument of stagnating wages. But even the NYT cites that real average hourly pay rose by 1.6%, one of the highest increases in the past 30+ years. But, the problem with using stagnating wages as a measure of the American worker's prosperity is that is incomplete. Over the past thirty years, prices of goods have fallen considerably. For example, a worker at an assembly plant can easily afford a flat screen TV and a new bicycle at Wal-mart. This was not the case thirty years ago. Also, the wealth of lower class workers has also increased dramatically due to two recent phenomenon: the appreciation of homes and the record amount of the American public owning their own home (70% in 2004). Next, Mr. Webb shows his ignorance:

"Our white-collar professionals are beginning to understand it, as their jobs start disappearing also. And they expect, rightly, that in this age of globalization, their government has a duty to insist that their concerns be dealt with fairly in the international marketplace."

Jobs are disappearing. That is funny. Actually, employers can't find enough people to work for them. We are almost at full employment. The 4.5% unemployment rate is almost as low as it was in 2000, which was the lowest rate of unemployment since 1969. As for globalization, the only way that the American people would be hurt by it is if the government tries to shield the American people from it. We should all take note. The Democrats want to retreat from globalization while the Republicans (at least most of them) want to embrace it.

The next time you think of voting Democrat just think about what one of their icons says in the NYT:

“In the past, the attitude was, ‘Get government out of the way.’ And now it’s, ‘Gee, I may need it.’ ”

Lord save us if they keep this rhetoric up.