Friday, October 24, 2008

Rogoff and Redistribution

In response to the flood of Republicans who are now endorsing Obama, Brad Delong asks:

But where are the economists?

Marty Feldstein?
Glenn Hubbard?
Greg Mankiw?
Eddie Lazear?
John Taylor?
Michael Boskin?
Ken Rogoff?

I think the one name on that list of prominent academic economists who support McCain that has always gnawed at me is Harvard economist Ken Rogoff. I've been wanting to link to this interview with Rogoff in Der Spiegel for some time and I think that this silly "spreading the wealth" line of attack by McCain is a good opportunity to use Rogoff's words against his apparent choice for President. Here are a few excerpts.

Rogoff on the inheritance tax:

I tell my children that a man like Bill Gates has a personal fortune of $100 billion. They can't even comprehend that. Then I explain that he has more money than some countries. If we have these extremes, I can't understand why we should get rid of the inheritance tax. It hasn't harmed the economy, and it has evened out the distribution of income across generations.

ummm, that sounds a tad bit like "spreading the wealth"...does that mean that one of the big 90 is really a socialist?

Rogoff on inequality:

There has never been a better time to get rich. It's quite astonishing how much money people make in the hedge fund business and in the private equity field, and how well-off affluent families really are. Given these contradictions, it comes as no surprise that average Americans have a different perception of the economy than (US President) George W. Bush and his friends. They can play around with statistics as much as they want, but it's clear that we have an unfair distribution of wealth.

On labor's share of income:

Rogoff: There has been a noticeable decline in the labor factor in all wealthy countries in the past 20 years. The rich are getting richer, but those at the lower end aren't moving ahead as quickly as the capitalists.

SPIEGEL: So Marx was right after all?

Rogoff: We're still a long way away from that. Workers are not being exploited. But if their share of growth doesn't increase, this could be a potential cause of social tension worldwide. ...

1 comment:

Anonymous said...

If this election in USA was held in Canada, the GOP would be reduced to a place in the phone booth.Canadians in the late 80's put the Conservative Party on the trash heap. It took them a period of time to re-establish the conservative brand and currently have a minority government. Canadians dealt them a blow just as they did to the current Liberal Party recently.Americans must develop the capacity to be independent of mind and use commom sense.