Thomas Donlan of Barron’s explains in his latest editorial commentary why efforts to help the American middle class should not lead to more dependence on government. Donlan specifically questions President Obama’s emphasis on a hazy concept dubbed “middle-class economics.”
The president summed up his concept this way: “It lets us keep building the world’s most attractive economy for high-wage jobs, with new investments in research, and infrastructure and manufacturing, as well as expanded access to faster Internet, and new markets for goods made in America.”
How nice that sounds to people who want to feel that government cares about them. But everything on the list is the proper business of private, profit-making enterprise.
Middle-class economics could promote progress, if it means that the Democratic Party and president are focusing on people who work and letting them work harder and smarter. It could damage economic progress if it means that the party and the president have a political agenda that puts more people into closer, more dependent relationships with their government.
The Patient Protection and Affordable Care Act, better known as Obamacare, is an example of a regressive form of government concern, because it has added millions of middle-class Americans to the Medicaid program and calls that health insurance reform.
Of course, Obama didn’t invent the idea of federal programs aiding the middle class. From Social Security to federal aid to public education, the federal government has often purchased political support for antipoverty programs by enlarging them to benefit as many non-poor citizens as possible.
Sometimes, as with Medicare, the new program turns out to be a universal entitlement. Other times, as with the invention of food-assistance programs, there’s bipartisan or regional log-rolling behind the scenes. Food aid expanded farmers’ markets.
Middle-class economics should mean a return to the principles that created the middle class and support for the people who created our prosperity.
The most important people in the middle class are not consumers living from paycheck to paycheck on the same lifetime jobs. The most important ones are the savers, investors, inventors, and life-long learners on their way up and out of the middle class.
