The Democrats love to talk about income inequality, but they appear to have little interest in figuring out what to do about it. Let's face it: the Democrats regard "income inequality" as a rallying cry–a vote getter in much the way that the phony "war on women" was in 2012.
Michael Barone observes how effective the issue of income inequality was for the heretofore mute Lincoln Chaffee, who said that his party had not come up with a solution for income inequality, during the Democratic debate on CNN:
But every once in a while a pig sniffs out a truffle and Chafee, after standing silently for tens of minutes, found one. For the policies proffered by the others on the stage would do little or nothing to reduce income inequality — just like the increase in high earner rates Obama got in 2013 (which no one mentioned).
Just because they don't have a solution doesn'e mean that Democrats won't be talking about income ineqquality in 2016.
The ususal "solution" is higher taxes. Bernie Sanders favors a 90 percent tax on the highest earners, for example. However, the Democrats didn't talk as much as might have been expected about tax hikes during the debates, perhaps because they know that, when they do this, middle class people always assume that they'll be the ones hardest hit. Also, the East and West Coast Democrats, places rich in votes for Democrats, know they would be hit.
Michael Barone proposes another reason they might have avoided talking about tax hikes:
Another good reason, though not one appealing to the candidates, is that history shows that no matter how high rates go, top earners' effective tax rates aren't much higher than currently. And current rates are the most progressive in the advanced OECD countries. The Scandinavian countries praised by Sanders have value-added (= sales) taxes around 25 percent.
A recent study by Brookings economists William Gale, Melissa Kearney and former Obama budget director Peter Orszag concluded that raising the high rate to 50 percent and distributing all proceeds to the lowest-income 20 percent would have an "exceedingly modest" effect in reducing income inequality. In response to critics, they wrote that "no single policy within the realm of the politically feasible could in fact substantially offset the long-term, powerful trends in income inequality."
Democrats' other proposals would not make much difference either, like Hillary Clinton's call for more spending on "early childhood education," despite repeated studies showing that it has no lasting effect, and "schools that meet needs," whatever that means.
Clinton, Sanders and Martin O'Malley called for "tuition-free college," echoing Barack Obama's free-junior-college proposal. But junior college is already free for most low-income students, and increases in government aid have produced administrative bloat. Which Clinton at least recognized, by calling for getting college costs down, without specifying how.
It's also worth asking what is progressive about a policy that forces taxpayers, many of whom lack the skills or inclination for college, to pay for the college costs of people who on average start off higher on the income ladder and may climb higher still.
As Barone points out, though, Democrats seem uninterested in something that could affect income inequality by helping people at the lower end earn more: a growth rate above the 2 percent we've seen under President Obama.
When it comes to income inequality, the Democrats prefer not to mention something else pertinent to the debate:
The Democrats' dirty little secret is that the inequality they complain of is most common in places where they have put policies like minimum wage increases and paid leave into place. California has the highest poverty rate (compared to living costs) in America, New York City the most economic inequality.
The GOP should call their bluff on the issue of income inequality. But will it?