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The Moochers of Middle America

Summary:
Last week’s debates clearly weakened Joe Biden and increased the odds that a more definitively progressive candidate — probably Kamala Harris or Elizabeth Warren — will win the nomination. And you can hear the wailing from much of the Beltway, the claims that Democrats are moving too far left.So it’s worth parsing those claims. In what sense are the Dems moving too far left? What I’m seeing are three fairly distinct claims. First, that the party is endangering its electoral prospects. Second, that the party is being fiscally or economically irresponsible. Third, that Democrats are unfairly proposing to redistribute income from those who create wealth to those who don’t.So you should know that the first claim is probably wrong, the second is definitely wrong, and the third ignores the

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Last week’s debates clearly weakened Joe Biden and increased the odds that a more definitively progressive candidate — probably Kamala Harris or Elizabeth Warren — will win the nomination. And you can hear the wailing from much of the Beltway, the claims that Democrats are moving too far left.

So it’s worth parsing those claims. In what sense are the Dems moving too far left? What I’m seeing are three fairly distinct claims. First, that the party is endangering its electoral prospects. Second, that the party is being fiscally or economically irresponsible. Third, that Democrats are unfairly proposing to redistribute income from those who create wealth to those who don’t.

So you should know that the first claim is probably wrong, the second is definitely wrong, and the third ignores the extent to which we already do a lot of redistribution in this country — with Republican voters some of the biggest beneficiaries.

On the politics: Politicians and pundits alike tend to have a lot more contact with the wealthy than with ordinary voters, and often seem to imagine that the priorities of the 1 percent — keeping top tax rates low, cutting “entitlements” — actually resonate with the general public. But polling overwhelmingly shows the opposite: Voters want to raise taxes on the rich and expand government social programs.

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In moving to the left on taxes and spending, then, Democrats are actually moving toward voters’ preferences, not away from them. Yes, Republicans will try to demonize their proposals, but they would do that in any case. Remember, they called Barack Obama, with his incrementalist policies and willingness to consider Medicare cuts, a socialist, too.

In fact, the best argument against “Medicare for All” skeptics like me, who worry how voters will react to proposals to eliminate private insurance, is that Republicans will scream about a government takeover of health care — and Fox News viewers will believe them — whatever you do.

On fiscal and economic responsibility: Nobody who endorsed the 2017 tax cut has any right to criticize Democratic proposals to spend more on things like child care. That tax cut, after all, appears likely to add around $2 trillion to federal debt — with around a third of that going to foreigners. Meanwhile, the promised surge in business investment is nowhere to be seen.

At the same time, there’s a very good case for arguing that Democratic proposals would have economic as well as humanitarian benefits.

Support for child care, for example, would free more women to enter the paid work force — where they would pay taxes that would offset some of the cost. And the children benefiting from that support would eventually become healthier, more productive adults.

In other words, while progressive Democrats are mainly arguing for greater social justice, they can also make a much better case than conservatives ever could that their proposals would help the economy and at least partly pay for themselves.

Last but not least, if your view is that the progressive agenda is morally wrong, that people shouldn’t receive more in government benefits than they pay in taxes, you should be aware how many Americans are already “takers,” “moochers,” whatever. In fact, we’re talking about a vast swath of the heartland that includes just about every state that voted for Donald Trump.

I’ve been reading a recent Rockefeller Institute report on states’ federal “balance of payments” — the difference for each state between what the federal government spends in that state and what it gets back in revenue.

The pattern is familiar: Richer states subsidize poorer states. And the reasons are clear: Rich states pay much more per person in federal taxes, while actually getting a bit less in federal spending, because Medicaid and other “means-tested” programs go disproportionately to those with low incomes. But the magnitudes are startling.

Take the case of Kentucky. In 2017, the state received $40 billion more from the federal government than it paid in taxes. That’s about one-fifth of the state’s G.D.P.; if Kentucky were a country, we’d say that it was receiving foreign aid on an almost inconceivable scale.

This aid, in turn, supports a lot of jobs. It’s fair to say that far more Kentuckians work in hospitals kept afloat by Medicare and Medicaid, in retail establishments kept going by Social Security and food stamps, than in all traditional occupations like mining and even agriculture combined.

So if you really believe that Americans with higher incomes shouldn’t pay for benefits provided to those with lower incomes, you should be calling on “donor” states like New Jersey and New York to cut off places like Kentucky and let their economies collapse. And if that’s what you mean, you should let Mitch McConnell’s constituents know about it.

The point is that while you can criticize particular Democratic proposals, you can only portray progressives as radical or irresponsible, especially as compared with the modern G.O.P., by ignoring or suppressing a lot of facts. I guess facts really do have a liberal bias.

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Paul Krugman
Paul Robin Krugman (born February 28, 1953) is an American economist, Distinguished Professor of Economics at the Graduate Center of the City University of New York, and an op-ed columnist for The New York Times. In 2008, Krugman won the Nobel Memorial Prize in Economic Sciences for his contributions to New Trade Theory and New Economic Geography.

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