While President George W. Bush and fellow Republicans may be touting the growing economy as proof their policies are working, the Democrats say those corporate-level profits aren’t exactly trickling down to the average American. But it’s not the government’s job to redistribute wealth as far as the free market purists are concerned. Bill Griffeth hosted a debate on “Power Lunch” for the two sides to make their point.
According to Simon Rosenberg, median income for families has dropped $1,000 over the past six years. He’s the president of NDN, a Democratic think tank and advocacy group. The super wealthy may be doing well, he says, but most middle class Americans are feeling the crunch of lower wages and higher taxes.
“I don’t think that’s acceptable as a policy matter, frankly,” says Rosenberg, “or as a country that prides itself on being a democracy.”
Daniel Mitchell disagrees, saying that Americans are more prosperous than six years ago. Democrats, says the Cato Institute senior fellow, want to emulate the high-tax, high-spending Europeans even though the U.S. economy generates much more opportunity for the middle class.
“Did you realize that the average Swede has only 52% of the per capita disposable income of the average America?” Mitchell asks. “I don’t want to go down that path of class warfare, higher taxes and more spending because we will be as poor and as stagnant as the Europeans,” he says.
The prosperity of Europe is irrelevant to Rosenberg. He just wants someone to acknowledge that over the past 30 years, the only real boom took place during the Clinton administration of the ‘90s. Republican leadership has never generated the same returns.
“Their economic stewardship has left America weaker and the middle class in decline,” Rosenberg says. “We can do better, and I think this is a major part of what the presidential debate is going to be about in 2008.”
Mitchell thinks all this talk of class warfare is leading to higher taxes on the rich, and Bill Griffeth mentioned that when Rep. Charlie Rangel appeared on “Power Lunch” last, he didn’t say he was averse to the idea.
“I think the way to look at this is the way businesses have to look at their balance sheet and their businesses,” says Rosenberg. “What’s the strategy for how we’re going to ensure capital, corporation and people succeed. That’s the debate we need to have. Today, capital and corporations are succeeding. We have to figure out how, together, to have a new strategy to ensure that all three grow together.”