Tuesday, June 17, 2008

A candidate for those who think the government is too small

Senator Obama puts some "substance" behind his campaign for change.
Sen. Obama cited new economic forces to explain what appears like a return to an older-style big-government Democratic platform skeptical of market forces. "Globalization and technology and automation all weaken the position of workers," he said, and a strong government hand is needed to assure that wealth is distributed more equitably.
I think that I liked the "form" better.


  1. And I think his substance is just fine. US income distribution has become steadily more skewed toward the top in recent decades -- see the data and papers cited in my consumer surplus paper (http://www.usdoj.gov/atr/public/eag/225696.htm or http://www.globalcompetitionpolicy.org/index.php?id=587&action=907). A graph in last Sunday's Washington Post Book World (http://www.washingtonpost.com/wp-dyn/content/article/2008/06/12/AR2008061203779.html) suggests, at least, that who's president indeed makes a difference. Given the choice, why not help make the poor rather than the rich richer?

  2. if you think that education is skewing the income distribution, then you subsidize education. If you attack the income distribution directly, then you screw up the incentives to get an education.

  3. Yes, good point. But all subsidies seem to come bundled with incentive problems, so the idea is to find policies with the best tradeoffs of most public benefits vs. least harmful incentives. Food stamps? College tuition loans or grants? Graduated income tax? Lots of interesting research and policy design here.