On Election Day, The Boston Globe reported, Logan International Airport
in Boston was running short of parking spaces. Not for cars — for
private jets. Big donors were flooding into the city to attend Mitt
Romney’s victory party.
Fred R. Conrad/The New York Times
Paul Krugman
They were, it turned out, misinformed about political reality. But the
disappointed plutocrats weren’t wrong about who was on their side. This
was very much an election pitting the interests of the very rich against
those of the middle class and the poor.
And the Obama campaign won largely by disregarding the warnings of
squeamish “centrists” and embracing that reality, stressing the
class-war aspect of the confrontation. This ensured not only that
President Obama won by huge margins among lower-income voters, but that
those voters turned out in large numbers, sealing his victory.
The important thing to understand now is that while the election is
over, the class war isn’t. The same people who bet big on Mr. Romney,
and lost, are now trying to win by stealth — in the name of fiscal
responsibility — the ground they failed to gain in an open election.
Before I get there, a word about the actual vote. Obviously, narrow
economic self-interest doesn’t explain everything about how individuals,
or even broad demographic groups, cast their ballots. Asian-Americans
are a relatively affluent group, yet they went for President Obama by 3
to 1. Whites in Mississippi, on the other hand, aren’t especially well
off, yet Mr. Obama received only 10 percent of their votes.
These anomalies, however, weren’t enough to change the overall pattern.
Meanwhile, Democrats seem to have neutralized the traditional G.O.P.
advantage on social issues, so that the election really was a referendum
on economic policy. And what voters said, clearly, was no to tax cuts
for the rich, no to benefit cuts for the middle class and the poor. So
what’s a top-down class warrior to do?
The answer, as I have already suggested, is to rely on stealth — to
smuggle in plutocrat-friendly policies under the pretense that they’re
just sensible responses to the budget deficit.
Consider, as a prime example, the push to raise the retirement age, the
age of eligibility for Medicare, or both. This is only reasonable, we’re
told — after all, life expectancy has risen, so shouldn’t we all retire
later? In reality, however, it would be a hugely regressive policy
change, imposing severe burdens on lower- and middle-income Americans
while barely affecting the wealthy. Why? First of all, the increase in
life expectancy is concentrated among the affluent; why should janitors
have to retire later because lawyers are living longer? Second, both
Social Security and Medicare are much more important, relative to
income, to less-affluent Americans, so delaying their availability would
be a far more severe hit to ordinary families than to the top 1
percent.
Or take a subtler example, the insistence that any revenue increases
should come from limiting deductions rather than from higher tax rates.
The key thing to realize here is that the math just doesn’t work; there
is, in fact, no way limits on deductions can raise as much revenue from
the wealthy as you can get simply by letting the relevant parts of the
Bush-era tax cuts expire. So any proposal to avoid a rate increase is,
whatever its proponents may say, a proposal that we let the 1 percent
off the hook and shift the burden, one way or another, to the middle
class or the poor.
The point is that the class war is still on, this time with an added
dose of deception. And this, in turn, means that you need to look very
closely at any proposals coming from the usual suspects, even — or
rather especially — if the proposal is being represented as a
bipartisan, common-sense solution. In particular, whenever some
deficit-scold group talks about “shared sacrifice,” you need to ask,
sacrifice relative to what?
As regular readers may know, I’m not a fan of the Bowles-Simpson report
on deficit reduction that laid out a poorly designed plan that for some
reason has achieved near-sacred status among the Beltway elite. Still,
at least you can say this for Bowles-Simpson: When it talked about
shared sacrifice, it started from a “baseline” that already assumed the
end of the high-end Bush tax cuts. At this point, however, just about
all the deficit scolds seem to want us to count the expiration of those
cuts — which were sold on false pretenses, and were never affordable —
as some kind of big giveback by the rich. It isn’t.
So keep your eyes open as the fiscal game of chicken continues. It’s an
uncomfortable but real truth that we are not all in this together;
America’s top-down class warriors lost big in the election, but now
they’re trying to use the pretense of concern about the deficit to
snatch victory from the jaws of defeat. Let’s not let them pull it off.
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