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from The Great Debate:
Mr. 1 Percent versus Mr. 1 Percent
Listening to a newly populist President Obama or to Mitt Romney, who touts his CEO past at every turn, it is tempting to imagine a 2012 election that unfolds as textbooks imagine, with Republicans speaking for business and Democrats standing up for the little guy. Don’t be fooled. A more accurate reading of the contest features two elite candidates who represent different wings of the 1 Percent – a group increasingly divided over economics and the role of government.
Look closely at Obama’s rhetoric and you see that he’s not channeling Occupy Wall Street as much as a pragmatic tax-and-invest liberalism. Obama speaks for highly educated, affluent Americans who want government to do more, not less, on a number of fronts – like education, infrastructure, scientific research and clean energy. These folks don’t envy Europe; they envy China, which is deploying a muscular statism to compete economically and dominate the future.
Yes, Obama has made some strong statements lately about inequality and raising taxes on rich people. But most of this goes over just fine in Malibu or Manhattan. Many of the rich are ready to pay higher taxes – with polls showing, for instance, that a majority of millionaires support the Buffett Tax. And many agree that inequality has gone too far, seeing the growing wealth divide as a threat to America’s economic dynamism and social cohesion. The things that liberal rich people don’t like – unions, protectionism, and regulation, etc. – Obama doesn’t like much either.
Romney, meanwhile, speaks for a more familiar kind of 1 Percenter who thinks that business has all the answers and government should claim as little private wealth as possible. These elites embrace what New York Times columnist Ross Douthat last week called the “competitiveness revolution” – a drive for greater efficiencies and higher profits in which private equity firms like Bain Capital are heroes, not villains. Most of these people aren’t concerned about inequality, believing that all boats will rise faster in a laissez-faire economy and the fantastic heights of the yachts will only serve to inspire people. The best thing government can do for the little guy, the logic here goes, is get out of the way of private enterprise.
This clash of elites is hardly new. It has been taking shape for years now as the economy has diversified, with vast new wealth created by highly educated knowledge workers who live and work in blue states and, by and large, believe in government and elite experts. Barack Obama, so obviously smart and logical, with two Ivy League degrees, is a near-perfect fit for this crowd.
Romney is a less ideal candidate for his pro-business constituency, at least according to his mixed record on taxes and government as Massachusetts governor. But he’s close enough, with his CEO credentials and a set of policy positions that blogger Ezra Klein noted recently put him well to the right of George W. Bush.
While the media often imply that Obama has been abandoned by his affluent supporters and is now banking on populist appeals, campaign finance data supports the notion of a divided 1 Percent. Obama has been raking in big bucks from wealthy supporters – nearly as much as all the Republican candidates combined – and Democrats overall have raised more money in the current election cycle than Republicans (not including outside groups) – despite the attention-grabbing GOP primaries under way. As in the previous few elections, Democrats are doing great with lawyers, tech leaders, entertainment professionals and other educated elites.
from Unstructured Finance:
At the intersection of Wall and Main
By Jennifer Ablan and Matthew Goldstein
Whether you agree with it or not, the Occupy Wall Street protests that began two months ago in New York have ignited a debate over income inequality and the political clout of the nation’s banks.
Before the protesters began camping out in Zuccotti Park in lower Manhattan, much of the conversation had focused on the federal government’s debt and not the equally big debt run-up by U.S. consumers in the years before the financial crisis. Now it seems you can’t go a day without reading a story about the vast gulf between rich and poor and the shrinking middle class, or how the housing crisis won’t get fixed until something is done to alleviate the burden for millions of homeowners who are underwater on their mortgages.
Last month a group of graduate journalism students from Columbia University spent some time at the Occupy Wall Street encampment in Zuccotti where they did in-depth interviews with over 200 protesters. (This was before New York City moved to forbid people from sleeping out in the concrete plaza). And the students findings were surprising in that the OWS protesters weren’t just a bunch of unemployed hippies, who all vote Democratic. Rather, they found that the majority of protesters didn’t identify with either political party, 56 percent didn’t have private health insurance and just under 40 percent gave President Obame a grade of C for managing the economy.
We talked to two of the students, Lili Holzer-Glier and Mollie Bloudoff-Indelicato, and this video discusses some of their research.
The findings of the Columbia students are something that many who work on Wall Street might want to pay more attention to. In our story “The Wall Street Disconnect,” we found that many of the 1 percent of the finance world just don’t get why so many people in the U.S. and around the world are upset with their profession.
The disconnect between Wall Street and Main Street is a bit startling, given that three years after the worst of the financial crisis unemployment remains at 9 percent, 15 percent of the country is on food stamps and at least 20 million people live in extreme poverty in this country. And in many states, entire neighborhoods are ravaged by foreclosures.
Romney is far from being assured the GOP nomination. This sort of talk (elitist in itself) is music to the ears of Gingrich.