The Social Contract (Nobel Laureate Paul Krugman says Republicans don't respect it)

This week President Obama said the obvious: that wealthy Americans, many of whom pay remarkably little in taxes, should bear part of the cost of reducing the long-run budget deficit. And Republicans like Representative Paul Ryan responded with shrieks of “class warfare.”

It was, of course, nothing of the sort. On the contrary, it’s people like Mr. Ryan, who want to exempt the very rich from bearing any of the burden of making our finances sustainable, who are waging class war.

As background, it helps to know what has been happening to incomes over the past three decades. Detailed estimates from the Congressional Budget Office — which only go up to 2005, but the basic picture surely hasn’t changed — show that between 1979 and 2005 the inflation-adjusted income of families in the middle of the income distribution rose 21 percent. That’s growth, but it’s slow, especially compared with 100% rise in median income over a generation after World War II.

Meanwhile, over the same period, the income of the very rich, the top 100th of 1% of the income distribution, rose by 480%. No, that isn’t a misprint. In 2005 dollars, the average annual income of that group rose from $4.2 million to $24.3 million.

To be fair, there is argument about the extent to which government policy was responsible for the spectacular disparity in income growth. What we know for sure, however, is that policy has consistently tilted to the advantage of the wealthy as opposed to the middle class.

Some of the most important aspects of that tilt involved such things as the sustained attack on organized labor and financial deregulation, which created huge fortunes even as it paved the way for economic disaster.

So do the wealthy look to you like the victims of class warfare?

Not yet. Marie Antoinette looked fine, too, just before they cut her head off.

The only thing in American politics that might be described as a social contract is the Constitution itself, and it says nothing about redistribution of wealth in pursuit of social justice.

There is real class warfare going on, but it isn't focused on "the wealthy", it's focused on the middle class, because it is the middle class that is the repository of political liberty. Marx hated and despised the petit bourgeoisie as an impediment to revolution, which it is. It is also an impediment to the sort of authoritarian control the Dems are now trying to sell as populism.

"The wealthy" don't really have anything to be worried about short of the return of the Dr. Guillotine. They have resources necessary to protect both their wealth and their persons. It is the middle class that is milked in every scheme ever devised by greedy redistributionists and it is the middle class that will be milked here. That's where the real money is.

But for Krugman to pretend that this public relations campaign centered around the hoary old claim that "the wealthy aren't paying their share" is somehow not class warfare is blatantly and profoundly dishonest. It is the very definition of class warfare. It is the common resort of an oppressive government to distract its citizens from the obvious results of its own corruption and incompetence. The good news, if there is any, is that it is likely to be as corrupt and incompetent at this as it is at everything else.

over the same period, the income of the very rich, the top 100th of 1% of the income distribution, rose by 480%

Great...he has to get to a nano-level to make a point that doesn't matter.
In 2005, (near as I can figure based on the Tax Foundation figures) )there were 135,000 tax returns filed by people in top 0.1% who had an aggregate AGI of $799 billion. they paid an aggregate of $180 billion in income taxes.

http://www.taxfoundation.org/news/show/250.html#Data

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