“Punting the Pundits” is an Open Thread. It is a selection of editorials and opinions from around the news medium and the internet blogs. The intent is to provide a forum for your reactions and opinions, not just to the opinions presented, but to what ever you find important.
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Steven Rattner: nequality, Unbelievably, Gets Worse
THE Democrats’ drubbing in the midterm elections was unfortunate on many levels, but particularly because the prospect of addressing income inequality grows dimmer, even as the problem worsens.
To only modest notice, during the campaign the Federal Reserve put forth more sobering news about income inequality: Inflation-adjusted earnings of the bottom 90 percent of Americans fell between 2010 and 2013, with those near the bottom dropping the most. Meanwhile, incomes in the top decile rose. [..]
Perhaps income disparity resonated so little with politicians because we are inured to a new Gilded Age.
But we shouldn’t be. Nor should we be inattentive to the often ignored role that government plays in determining income distribution in each country.
Here’s what’s rarely reported:
Before the impact of tax and spending policies is taken into account, income inequality in the United States is no worse than in most developed countries and is even a bit below levels in Britain and, by some measures, Germany.
However, once the effect of government programs is included in the calculations, the United States emerges on top of the inequality heap.
Trevor Timm: First Snowden. Then tracking you on wheels. Now spies on a plane. Yes, surveillance is everywhere
The US government’s secret airborne dragnet is just the latest tool to snoop on your phone. Why aren’t we stopping this?
US government-owned airplanes that can cover most of the continental United States are covertly flying around the country, spying on tens of thousands of innocent people’s cellphones. It sounds like a movie plot, but in a remarkable report published on Thursday, the Wall Street Journal exposed that these spy planes are part of an actual mass surveillance program overseen by the Justice Department (DOJ). And it’s been kept secret from the public for years.
The Journal explained that the US Marshals Service, a sub-agency under DOJ’s control, has a small fleet of Cessna airplanes that are currently armed with high-tech surveillance gear called “dirtboxes” – essentially fake cell towers tricking your phone into connecting to them – that can vacuum the identifying information and location of ten of thousands of phones in a single flight. [..]
You might ask: Why are the US Marshals – the fugitive-chasing agents of Tommy Lee Jones lore – get the authority to launch this type of mass surveillance operation at all? That’s unclear, but thanks to some digging by the surveillance crowd on Twitter shortly after the Journal published its story, we know the marshals are far from the only US agency using dirtboxes.
The nonpartisan Congressional Budget Office has just released its latest appraisal of America’s income breakdown. Whatever yardstick you use, the CBO shows, the rich are winning. Big.
How much income do America’s households take in? How much do they have left after taxes? Do federal taxes leave the nation less or more unequal?
Questions don’t get much more basic than these. Or more complicated either.
How, for instance, do we define income? Everyone agrees, of course, that anything anyone collects from a paycheck should count as income. As should any interest collected from a bank account or any profits from the sale of an asset.
But what about the money an employer shells out to cover an employee’s health insurance premiums? Or contributes into an employee’s 401(k)? Should these dollars be counted as income for the employee?
Calculating how much taxes people pay can pose similar puzzlers. How do we treat the taxes corporations pay on their income? Who in the end bears that burden? Shareholders? Consumers?
Paul Krugman: When Government Succeeds
The great American Ebola freakout of 2014 seems to be over. The disease is still ravaging Africa, and as with any epidemic, there’s always a risk of a renewed outbreak. But there haven’t been any new U.S. cases for a while, and popular anxiety is fading fast.
Before we move on, however, let’s try to learn something from the panic.
When the freakout was at its peak, Ebola wasn’t just a disease – it was a political metaphor. It was, specifically, held up by America’s right wing as a symbol of government failure. The usual suspects claimed that the Obama administration was falling down on the job, but more than that, they insisted that conventional policy was incapable of dealing with the situation. Leading Republicans suggested ignoring everything we know about disease control and resorting to extreme measures like travel bans, while mocking claims that health officials knew what they were doing.
Guess what: Those officials actually did know what they were doing. The real lesson of the Ebola story is that sometimes public policy is succeeding even while partisans are screaming about failure. And it’s not the only recent story along those lines.
Will Hutton: Banking is changing, slowly, but its culture is still corrupt
The latest financial scandal indicates how hard it is to stamp out double-dealing when bankers are allowed to live by their own rules
Another week, another financial scandal. Six global banks, including RBS and HSBC, were fined £2.6bn last week for rigging the foreign exchange markets. Since 2008, total fines levied in Europe and the US for banking crimes and misdemeanours now top £100bn, with banks making provision for a further £60bn. British banks alone have set aside an estimated £30bn for fines, provisions and litigation costs.
What has gone wrong with western finance?
The systemic ripping off of customers continued after the financial crisis to constitute what is now the biggest-ever global corporate scandal. Banks worldwide duped clients into buying products that were either not needed or provided no purpose. Worse, they organised financial markets whose purpose was to serve their own interests rather than those they purported to serve. It has proved a hard habit to break.
Robert Kuttner: Notes for Next Time: From Turnoff to Turnout
The voting turnout in this year’s congressional and gubernatorial elections was the lowest since 1942. Much of the story was in young people, poor people, black and Hispanic citizens who tend to support Democrats voting in far lower numbers than in 2008 or 2012. The Democrats just weren’t offering them very much.
But the other part of the Election Day story was older voters and the white working class, especially men, deserting the Democrats in droves — again, because Democrats didn’t seem to be offering much. Republicans, at least, were promising lower taxes.
Turnout on average dropped from 2012 by a staggering 42 percent. But as Sam Wang reported in a post-election piece for the American Prospect, the drop-off was evidently worse for Democrats.
The two parts of this story seem to create an impossible conundrum for Democrats: Do more for minorities and the poor, and you presumably risk driving social conservatives even further into the arms of Republicans. But ignore the needs of those who need more government activism — and the Democratic base fails to turn out.
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