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Thursday, October 22, 2015

Angus Deaton's Letter from America

Why "Trump’s rhetoric (and Bernie Saunders’ on the left) resonates with so many":

Letter from America: Horse, a hippo and middle-aged angst The election season is already upon us in the United States, about as welcome as what used to be called a ‘social disease,’ in this case with no possibility of cure for the next fifteen months. It is an unusually interesting election, at least if you are indifferent to the worst possible outcomes. For those of us who worry about the undermining of democracy by organized wealth, there is an ironic pleasure in watching the discomfort that The Donald has inflicted on the Republican moneyed establishment, especially its tax- and benefit-reducing orthodoxy. (A nice simile for Trump comes from a colleague who works in South Africa: Trump is like the hippopotamus, which rapidly twirls its tail to create a fan through which it defecates, throwing a noxious cloud on all around.) The irony is that only an independent multi-billionaire could mount such a challenge, and indeed, many would like to see an electable non-Clinton multi-billionaire on the Democratic side. While there is always an anti-Washington sentiment in US general elections, it is palpable now.
The new disaffected... The official unemployment rate is back to its level before the Great Recession, and the economy is ticking upwards. The fraction with health insurance has increased. Yet long-term unemployment remains stubbornly high and labor force participation is unusually low. Disability rates are sharply up. Real median wages show no sign of shaking off their long-term stagnation... Middle-aged Americans today are among the first to find, in their 40s and 50s, that they will be no better off than their parents. Many of them, who used to look forward to defined-benefit pensions, are now dependent on a stock market that looks like an increasingly unreliable guarantor of a happy retirement, and a world of zero interest rates is not a good world for those saving for retirement. These people have legitimate reasons to be unhappy. In the long familiar way, they have found convenient scapegoats. It was the blacks, or the women, or the immigrants who held down wages, or took the good jobs. It was the bankers who got rich from tanking the stock market, sinking pension prospects, and now paying no interest on lifetime savings. No wonder Trump’s rhetoric (and Bernie Saunders’ on the left) resonates with so many. ...
...and a new market for drugs ...

    Posted by on Thursday, October 22, 2015 at 02:13 AM Permalink  Comments (34)


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