I noted last week that Democrats are not benefiting very much from the significant improvements in the economy.

One reason for this is that the best news has come too late. Unemployment fell under 6 percent in September, but by the time that was announced Oct. 2 most people had already decided how they were going to vote – or whether they plan to vote at all.

A second reason there has been virtually no Democratic bump from very good economic news is that it comes at a time when voters are very angry with government, and strongly inclined to blame whoever is in power. As the party more associated with the view that government has a positive role to play in our society, Democrats suffer more from this general anger.

But there is a third reason. America’s economic growth is the envy of every other advanced nation, but it has done little for the average American. While it is better to have lower unemployment, a higher stock market and low inflation than not, little of this has accrued to the benefit of most people. Median income – the point at which half of the earners are above and half are below – has barely budged.

People whose income has not moved during the recession and the recovery are unsurprisingly unenthused to know that the nation as a whole has gotten richer.

This is a problem for Democrats in two ways. It explains why there has not been a greater advantage to Democrats from an economic performance better than most of the rest of the world. More important, it presents a frustrating vicious cycle that we confront.

Some of the reasons increased national wealth has been shared so unequally are inherent in the nature of the global economy. But there is a great deal that can be done by public policy to diminish this. I stress that the task is to diminish inequality not abolish it. A well-run market economy requires a certain amount of inequality to maximize production and increase efficiency. Our problem is not that we have an unequal distribution of wealth, but that inequality is more pronounced than is either economically necessary or socially desirable.

Sadly for Democrats, this has become self-reinforcing. Republican strength has prevented Democrats from enacting public policies that would increase the extent to which middle- and working-class Americans share in the increased prosperity. The minimum-wage increase is one example.

For another example, when Bill Clinton worked with a Democratic House and Senate in 1993, we adopted changes that for the first time in recent history made the tax code one where the amount paid by the wealthy, compared to everybody else, increased. That was reversed by President George W. Bush and the Republican Congress in 2003 and 2004, and only partially restored by Democrats in the next Congress.

One obvious place to begin if we are serious as a society in extending opportunity for a wide range of Americans is in the financing of higher education. When I raised the question with two Republican-appointed chairs of the Federal Reserve, Alan Greenspan and Ben Bernanke, both agreed that inequality had become excessive and suggested that making community college education widely available to lower income people was one excellent way to deal with this.

Democrats tried to do this when we amended the law to stop the practice of banks making a profit by extending student loans that were fully guaranteed by the federal government, and therefore carried no risk to them. We were able to do part of this, but the piece of the bill that would have made billions more available to community colleges, allowing a lowering of cost to students, was blocked by the need to deal with a potential Republican Senate filibuster.

WORKERS LESS REPRESENTED

One area in particular has contributed to the increasing unfairness in the distribution of income. Republicans have been successful beginning with Ronald Reagan’s election to the presidency in eroding the position of unions in our economy.

The lack of worker representation in many of our largest enterprises has allowed companies to become ever increasingly profitable while paying little in wages to their workers. Wal-Mart, Amazon, McDonald’s – these are examples of vast enterprises that have been able to take advantage of the lack of any collective bargaining to keep worker compensation at levels that are not only low, but in the cases of some of these entities, less than what is needed to sustain a family.

Much of the Republican attack has been aimed at public employee unions, but their determination to diminish worker representation in the economy goes across the board.

One of the most egregious examples of brutal anti-union pressure was led recently by a man considered to be an anti-extremist Republican – Sen. Robert Corker of Tennessee. When the United Auto Workers succeeded in getting the right to conduct an election to represent workers at the Volkswagen plant in that state, with the company agreeing that this would be a good idea, Corker and other Republican officials threatened that if workers voted for a union, aid that had been promised by the state to support expansion of the plant would be withdrawn.

Even in the face of this shakedown, over 40 percent of the workers voted for the union, and there is little doubt that absent the threat by Corker and other Republicans to damage Volkswagen’s operations, the UAW would have prevailed.

What is especially interesting is the argument presented for this intervention against the right of workers to bargain collectively – a right acknowledged as legitimate by every Republican president from Eisenhower through Ford that ended only when Reagan, a former union leader, turned the National Labor Relations Board into an anti-union center of activity.

The anti-union extortionists threatened to withhold public money if the union won because they believed that Tennessee’s economic development has benefited by its low level of wages compared to much of the rest of the country. If the union were to come to a major manufacturing plant in Tennessee, they said, it might begin a process of increasing wages that would jeopardize the state’s ability to lure industry away from places where people were paid more decently.

LOW WAGE ADVANTAGE

The argument was not that it was important to block higher wages because jobs would leave America. The Tennessee anti-union brigade was explicit that the problem was the potential lack of a low-wage advantage over other states.

There are of course limits to what public policy can do to diminish inequality.

But politics has made the problem worse, so in a great example of a vicious cycle, Republican success in blocking measures supported by Democrats to reduce inequality has the added benefit of reducing Democratic voter appeal, which enhances the Republicans ability to prevent us from dealing with inequality and so on.

Breaking this pattern is the key challenge for those of us who believe that reducing excessive inequality is our most important domestic task.

Barney Frank is a retired congressman and the author of landmark legislation. He divides his time between Maine and Massachusetts. Follow him on Twitter:

@BarneyFrank

— Special to the Telegram

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