Washington Post Crashed-and-Burned Watch (Robert Samuelson Edition)
He makes his play for the Stupidest Man AliveTM crown:
Robert Samuelson: As The Rich Get Poorer Making the rich poorer doesn't make everyone else richer: For years, we've debated rising economic inequality. On one side, liberals denounce it as unjust. Redistribute wealth to the poor and middle class, they say. On the other, conservatives minimize its importance...
Not true: for years conservatives have denied its existence.
What matters most [conservatives say] is overall economic growth, they retort. Well, the conjunction of the presidential campaign and the financial crisis is giving the debate a curious twist. Liberals have triumphed politically; soaking the rich has become more acceptable. But conservatives may have won the intellectual argument; making the rich poorer doesn't make everyone else richer...
Making the rich poorer by deregulating financial markets so that a bunch of overleveraged Wall Street firms fail at risk management and cause a financial crisis doesn't make anybody richer. Making the rich poorer by taxing them more and devoting the money to debt reduction, infrastructure, and education does make everybody else richer--as we learned in the 1990s.
Robert Samuelson goes on:
Thousands of well-paid investment bankers, traders, portfolio managers and securities analysts are losing their jobs... executive compensation may be similarly squeezed. Profits are down; the political climate is hostile.... Judged only by economic inequality, the financial crisis is a godsend. It will probably narrow the gap—though still vast—between the rich and everybody else. But what good will that do? Economic inequality also declined in the Great Depression. The country wasn't better off. By and large, the poor aren't poor because the rich are rich. They're usually poor for their own reasons: family breakdown, low skills, destructive personal habits and plain bad luck.
The presumption implicit in the criticism of growing economic inequality is that society's income is a given and, if the rich have less, others will have more.... The larger truth is that much of the income of the rich and well-to-do comes from what they do. If they stop doing it, then the income and wealth vanish. No one gets it. It can't be redistributed because it doesn't exist. Everyone's poorer...
The income and wealth of Wall Street has vanished not because the "rich" of Wall Street have stopped doing what they do, but because the too many of the "rich" of Wall Street did do what they do: it is their failures of risk management that have made everybody poorer.
Every column of Robert Samuelson that Newsweek and the Washington Post publish hastens their demise--and harms the reputation of all their reporters.
