Thursday, September 12, 2013

Tyler Cowen: For Most Americans, Life Is Going to Become a Lower Class Brooklyn Existence

NPR reports:
Economist Tyler Cowen has some advice for what to do about America's income inequality: Get used to it. In his latest book, Average Is Over, Cowen lays out his prediction for where the U.S. economy is heading, like it or not:

"I think we'll see a thinning out of the middle class," he tells NPR's Steve Inskeep. "We'll see a lot of individuals rising up to much greater wealth. And we'll also see more individuals clustering in a kind of lower-middle class existence."

It's a radical change from the America of 40 or 50 years ago. Cowen believes the wealthy will become more numerous, and even more powerful. The elderly will hold on to their benefits ... the young, not so much. Millions of people who might have expected a middle class existence may have to aspire to something else.

"Imagine a very large bohemian class of the sort that say, lives in parts of Brooklyn," Cowen explains. "... It will be culturally upper or upper-middle class, but there will be the income of lower-middle class. They may have lives that are quite happy and rewarding, but they may not have a lot of savings. There will be a certain fragility to this existence."
I haven't read the book yet, but, judging by the NPR interview, Cowen oddly doesn't seem to make the connection between the decline of the middle class and government regulations stifling the economy.

I'll have a full review in  a week or so.


  1. Cowen is talking about the latest report on national income which shows that 1% earn 20% of national income and have seen 95% of income gains since 2009. It's the lack of regulations which leads to income inequality. That's why wealthy people lobby for deregulation/lax enforcement. Regulations which punish management for ripping off shareholders and consumers do not lead to income inequality. They reduce income inequality.

    1. No, the wealthy lobby for "deregulation" because "deregulation" is code talk for "let's give these lucrative government monopolies to my wealthy buddies."

    2. yea regulations like the COMMUNITY REINVESTMENT ACT sure helped the inequality didnt it? NOT!

  2. If "1% earn 20% of national income", then maybe commerce should be unrigged such that the "1%" cannot benefit from aggressive redistribution arranged by government under the color of law.

    For some reason the banking cartel and military capitalism come to mind now. But perhaps there's a good argument for abolishing the lawyers' cartels and the doctors' cartels first. Sure enough, these cartels, too, are arranged by government under the color of law and, at least in part, on the pretext of protecting the consumer.

    At any rate, unrig, unrig, unrig...even if it contradicts Keynesian orthodoxy and angers bleeding hearts.

  3. Lack of regulations, lol.

    I'm sure more regulations will fix the problem of the corrupt Congress which saw fit to bail out the banksters (instead of letting them crash and burn).

    I'm sure more regulations will prevent the Fed from giving free money to Wall St. so they can continue to rape, pillage and bribe.

    Take away the printing press, let the market determine what is money/set interest rates, and leave the regulation to the states and local communities.

    More regulations. Fuck you, you rancid statist commie cunt. Suck a bag of scabby dicks.

  4. " It's the lack of regulations which leads to income inequality. That's why wealthy people lobby for deregulation/lax enforcement.

    Sounds reasonable, except that's not the way the world works. The wealthy and powerful capture the coercive apparatus of the state and use the regulatory machinery to benefit themselves, eliminate competitors, and wring every last dime from the weak and poor. Probably the biggest misconception out there is this idea that wealthy, successful businessmen/women are some kind of rabid advocates for laissez faire capitalism and free markets. Do some reading.

  5. Part of the problem in this debate is different views on what regulation means to those on the right and left. If we define "regulation" as any rule imposed by force of government on the operation of free markets -- i.e., on voluntary exchanges between individuals and their freedom to use their own rightful property, so long as doing so doesn't infringe on the equal rights of others to enjoy the same liberties -- it's hard to conceive of circumstances in which regulation can generally be more effective than voluntary exchange in evenly and efficiently distributing wealth among members of a society. Because regulation operates by coercion, its general tendency is to destroy wealth or discourage creation of wealth, while concentrating what remains in the hands of a few.

    If regulation is defined that broadly, de-regulation means far more than letting corporate entities do as they please. Jay Broni is correct, historically most regulation is promoted by one special interest or another; often these are corporate interests at work.

    Well, I'm out of time. Keep it civil, folks.

  6. Anyone foolish enough to claim there is a lack of regulation should have to read the Code of Federal Regulations to prove it.