Why Growth Is Bad for Elizabeth Warren
We may finally have an economic recovery worthy of the name. Perhaps we'll even see widespread wage growth in the near future. If the good news continues this year and next, we can expect President Barack Obama's approval rating to keep improving. Democrats will have a better chance of keeping the White House in 2016. And Republicans will have to find a new economic message.
But a good economy isn't all good news for Democrats. It's a problem for the party's left -- and especially their efforts to demonize Wall Street.
The left wing of the Democratic Party has been arguing that inequality is the central challenge of our time and that we need a populist politics to combat it. It has found champions such as Senator Elizabeth Warren of Massachusetts and Mayor Bill De Blasio of New York to make that case. Some of these populists even want Warren to run for the Democratic nomination against Hillary Clinton, with the former taking on the plutocrats the latter is cozy with.
If most people start seeing their wages rise, though, public anger will probably dissipate. Even over the past few years, Americans haven't been all that concerned about inequality. In a 2011 Gallup Poll, economic growth and equality of opportunity were bigger priorities than reducing the income gap between rich and poor. In 2014 polls, only 2 percent to 3 percent of Americans identified that gap as the country's most important problem.
A sense that most people are getting ahead will leave economic inequality with even less purchase as an issue. It will be a lot harder to convince voters that the top 1 percent is keeping them down when they seem to be moving up.
Populists of the left tend to see the Gramm-Leach-Bliley Act -- the financial deregulation law enacted in 1999 -- as a disaster that led to the economic meltdown of 2008. It's no accident, though, that the law was enacted at a time when the country felt flush. So while renewed American prosperity would be good for Democrats in general, it would be especially good for Democrats on Wall Street -- and bad for their would-be scourges.
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