Arnold Kling

America's Class War

Arnold Kling, Great Questions of Economics
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Paul Krugman argues that class warfare is alive and well in America the Polarized.

[Political scientist Dr. Keith Poole] suggests that the most likely source of political polarization is economic polarization: the sharply widening inequality of income and wealth.

Krugman cites familiar data that since the 1970's the gains at the top of the income distribution have been much higher than gains in the middle. Although income comparisons are misleading (lifetime wealth is the preferred indicator), the basic story of widening inequality is correct.

The Krugman-Poole thesis is an excellent explanation for the phenomenon of wealthy communities on the two coasts voting for right-wing Republicans, while middle America votes Democratic. In other words, Krugman's political theory has the famous Red and Blue map exactly backwards.

Another point that I would make is that this is not your father's (or Karl Marx's) version of class warfare. Instead of talking about the division of earnings between labor and capital, Krugman's class warfare is about whether income taxes and government spending should be a slightly higher fraction of GDP.

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