Peter Morici Blog | How Democrats Promote Poverty and Inequality | Talkmarkets
Professor Emeritus, Robert H. Smith School of Business, University of Maryland

Professor Peter Morici is a recognized expert on economic policy and international economics. Prior to joining the university, he served as director of the Office of Economics at the U.S. International Trade Commission. He is the author of 18 books and monographs and has published widely in ... more

How Democrats Promote Poverty and Inequality

Date: Thursday, November 3, 2016 12:13 PM EDT

Hillary Clinton has made addressing inequality a central theme of her campaign, but the remedies she proposes are often worse than the disease.

Since Ronald Reagan, successive presidents have built out the social safety net, and made it more susceptible to abuse. For example, about one in five working age adults receive social security disability benefits, more than double the 1990 rate, even though we now live healthier, longer lives

As government transfer payments as a share of household income have increased, growth and jobs creation over successive economic expansions have slowed and the middle class is shrinking

Anemic growth has many sources—declining trade competitiveness vis-à-vis China and chronic shortages of skilled labor, which make implementing the latest technologies difficult for business.However, government policies contribute importantly too.

Poorly crafted and enforced trade agreements that Mrs. Clinton and Donald Trump both rail against have permitted China to snatch important segments of industrial supply chains that benefit little from its cheap labor.The resulting trade deficit depresses demand for American made products, employment and wages.

Greater emphasis on income support and health care programs in federal and state budgets to placate frustrated voters have curtailed public support for basic research at private and university laboratories, and squeezed funding for colleges of engineering and technical training at community colleges and high schools.

Businesses are increasingly establishing their own training programs or subsidizing those at community colleges but public schools place too much emphasis on diversity and social issues in the curriculum. Consequently, about 40 percent of high graduates lack math and other skills needed to succeed in these programs.

Too many high school graduates and college graduates, who often lack the basic problem solving skills for even entry level administrative and managerial positions, often end up in dead-end, low-paying jobs.

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David Reynolds 3 years ago Member's comment

It's a sad truth that #Democrats, including #Obama and #Hillary, claim to champion low income families, but all they do is buy their votes with free handouts like #ObamaPhones, #FoodStamps free #healthcare and other benefits. I agree that this only helps to keep them down. These incentivize people to turn down job offers since they can do better with the handouts than without.

Currency Trader 3 years ago Member's comment

I agree that certain basics, like health care should be available to all. But people should be obligated to try to find work in order to get these benefits. I've known people who don't even try to get a job, since they would lose all these benefits. They'd have to find a job for over $100k to come close to breaking even. So why spend money on a commute and work long hours, if it means you'll have to pay taxes, and pay for your food, healthcare, cell phone and more if it means your take hime is even less.

Dean Gilmore 3 years ago Member's comment

What bothers more more is the abuse. There is so much fraud from people who are working and getting cash under the table yet are still collecting all these benefits.