Robin Hood Democrats?

Most of us are aware of the story of Robin Hood, a person who robbed from the rich to give to the poor.

While most likely fictional, it has resonated over the years as a popular story and has inspired a number of books and movies.

This popular legend resonates because it was pretty clear that the rich of that time exploited the labor of the serfs who worked their lands.

The rich exploiting the poor is something that has happened almost everywhere almost always.

It has led to significant disruptions, think the French Revolution or the Russian Revolution to name two.

However the system has always ultimately reverted back to this model, as some of us manage to excel and surpass the rest of us in acquiring wealth.

I don't think too many of us object to the people who do this, like Bill Gates, or Warren Buffet.  They managed to create their own money and they certainly have the right to enjoy it.

What strikes many as unfair is how profits are distributed among those who generate them.  If you look at the statistics you see a number of trends which basically tell you the rich get richer and the poor are standing still at best.

One example would be CEO pay vs average worker pay.  In 1965 CEO's made about 25 times what the average worker made.  On average they now make closer to 200 times as much.  Have CEO's become that much better?

The problem of wage inequality is further compounded by the wealth inequality.  The average American has seen his wealth increase except of course the average hides a disturbing fact.  All that increase went to those in the upper percentiles while those in the bottom saw wealth stay the same or even decrease.

In the last election we saw the current President tap into the discontent this has sown by promising  to reverse that trend, however he has passed a tax bill that increases is.

The next election may see a whole different populist approach to fixing the problem, call it the Robin Hood one, or if you oppose it you might call it a socialist approach.

We'll see.

Government Role

In many ways the economy is doing well, but in some other ways not so much.

It was always clear from the demographics that we would have a bit of a labor shortage after the baby boomers started to retire and to some extent that is driving the low unemployment.

However, many of them are not prepared for retirement so I guess they are either staying in their current jobs or finding new ones.

We have seen a transition from a manual labor manufacturing model to a more robotic, technical one and that has disrupted a lot of rust belt jobs.  Those jobs aren't coming back even as we add some manufacturing jobs to our lowered base.  Unskilled labor is simply not going to command the wages it once did.  This is in many ways a positive trend for the economy and growth although not for those specific workers.

The issue there is that the profits are being unequally distributed with the displaced workers getting very little transition assistance as we reduce the Government programs that could have helped them.

This uneven distribution of wealth is probably the greatest threat to our country as it attacks the very foundation of our middle class society.

The best way to fix it is via Government programs as in Europe where certain expenses such as health care and pensions are centralized allowing people to have less expenses.

Of course those type of programs are an attack on wealthy people who would be subsidizing the poor.

Should the Government serve as the provider of certain services or not?

We are somewhere in the middle and right now we are saying no, in general.

However, the level of income inequality shows how our current approach is failing, so the times they may be a changing.