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Politics

Affluence and Influence: Economic Inequality and Political Power in America

With support from the Foundation, Martin Gilens, Professor of Politics at Princeton University, has been studying economic inequality and political power in the United States. His project, entitled “Inequality and Democratic Responsiveness,” relates policy preferences expressed by low, middle, and high income Americans with actual federal policymaking between 1964 and 2006. Gilens’ analyses show enormous inequalities in the responsiveness of policymakers to more and less affluent citizens, but they also show that the degree of representational inequality depends strongly on political conditions like the proximity of elections and the division of partisan control in Congress. Results from this project are forthcoming in Affluence & Influence: Economic Inequality and Political Power in America (2012, Russell Sage and Princeton University Press).

A central tenet of democracy is that government policy should reflect the preferences of the governed. This ideal of political equality is perhaps impossible to fully achieve in the face of economic inequality—in every democracy, citizens with greater resources are better able to shape government policy to their liking. But the degree of political inequality in a society, and the conditions which exacerbate or ameliorate it, tell us much about the quality of its democracy.

To understand the relationship between citizens’ preferences and government policy, I have assembled a dataset of over 2,000 survey questions about specific proposed policy changes. My data include questions asked between 1964 and 2006, and cover all areas of federal government policy from raising the minimum wage, to restricting abortions, to sending U.S. troops to Bosnia. Using these survey measures of public attitudes, I relate policy outcomes to the degree of support for each proposed change among poor, middle-class, and affluent Americans (more specifically, those at the 10th, 50th, and 90th percentiles of household income).

Not surprisingly, I find that policy outcomes are more strongly related to the preferences of the well off than those of the poor or the middle class. But the extent of this “representational inequality” is staggering: when preferences of low or middle income Americans diverge from those of the affluent, there is virtually no relationship between policy outcomes and the desires of these less advantaged groups. In contrast, affluent Americans’ preferences exhibit a substantial relationship with policy outcomes whether their preferences are shared by lower income groups or not.

Representational inequality, I find, is spread widely across different policy domains and appears consistently in my analyses across time periods and differing political conditions as well. But the extent to which affluent Americans’ preferences prevail over those of the middle class and the poor does vary, and under specific circumstances the preferences of the middle class and, to a lesser extent, the poor, do seem to matter. In particular, impending elections—especially presidential elections—and an even partisan division of Congress appear to mitigate representational inequality. These conditions also boost responsiveness to the preferences of the public in general. That is, in presidential election years or when Congress is evenly divided between Democrats and Republicans, policy outcomes are more closely aligned with the preferences of all income groups. But outside of these periods, responsiveness to the less well off declines more dramatically than responsiveness to the affluent.

The importance of political conditions in shaping patterns of responsiveness to public preferences suggests that the institutions of democracy can function to bring policy more in line with the public’s desires. But they also suggest that absent these (fairly infrequent) conditions, party leaders and other policymakers are disinclined to take the preferences of most Americans into account. Indeed, under conditions of extremely strong party control when one party or the other dominates the federal government, even the preferences of the affluent take a back seat to the parties’ core activists and interest group allies.

What Explains Representational Inequality?

Affluent Americans differ from the less well off in a variety of ways that might contribute to their oversize influence on government policy. Those with higher incomes are more likely to vote, more likely to volunteer on political campaigns or participate in party organizations, more likely to contact their elected representatives, and more likely to donate money to candidates, parties, and interest organizations that lobby the government. Of the various kinds of political engagement, however, monetary contributions is only one which matches the patterns of representational inequality I find in my analyses. For other forms of engagement, the most significant differences are between the poor on the one hand, and the middle class and affluent on the other. But when it comes to money, the affluent are the distinctive group. Most of the money donated to political candidates, parties, and interest organizations comes from Americans at the top of the economic ladder. The top-heavy pattern of political donations conforms to the top-heavy nature of representational inequality; under typical circumstances, even citizens at the 70th percentile of household income have little influence over policy outcomes when their preferences diverge from those at higher income levels.

The strong bias toward the preferences of the most affluent Americans raises the specter of a vicious cycle. Over the past decades, economic inequality has grown as income and wealth have become increasingly concentrated among a smaller and smaller fraction of Americans. The disproportionate political influence of the affluent (who tend, naturally enough, to favor policies that enhance their interests) may further reinforce their economic advantages leading to even greater representational inequality.

How Can Representational Inequality be Reduced?

My research suggests four possibilities. First, reduce the role of money in politics. A simple suggestion but a devilishly difficult task. Many observers have likened campaign finance regulation to squeezing a balloon—if you squeeze in one place the balloon simply pops out in another. Money, it is thought, will find its way into politics no matter what obstacles are thrown in its way. One cause for hope is experience of the U.S. states, which have adopted various campaign finance reforms including a range of public financing programs. Scholars have not examined the impact of such reforms on representational equality per se, but they have shown that campaign finance reforms can narrow gubernatorial incumbents’ fund raising advantage and make state legislative elections more competitive.

In addition to campaign finance reform, other reforms that make elections more competitive are likely to enhance responsiveness to public preferences and reduce representational inequality. For example, non-partisan redistricting and get out the vote campaigns have both been shown to increase electoral competitiveness.

A third approach to addressing representational inequality is to focus more attention on policies that benefit the middle class and the disadvantaged, but which have broad public support across the income spectrum. For example, strong majorities of affluent Americans have consistently favored increasing the minimum wage. Similarly, support for educational assistance, job training, child care, and health care for the needy is strong among both low and high income Americans.

Finally, reducing political inequality will be difficult as long as economic inequality continues to increase. Market inequality (that is, pre-tax and pre-transfer inequality) has grown over the past few decades in all advanced countries. But government policies in most countries have adapted to combat this movement, while tax and transfer policies in the U.S. have become less redistributive over time, exacerbating these global trends. Reducing economic inequality is at least as daunting a task as reducing political inequality. But the importance of political conditions in determining the responsiveness of policymakers to different segments of the public suggest that our political destiny is not predetermined. It would be naïve to think that political influence can ever be divorced from economic resources. But my research shows that electoral pressure can bring policy more in line with majority preferences. Whether these electoral forces can be successfully marshaled to reform democratic institutions and reduce representational inequality remains to be seen.

I’d like to dive into some concrete examples. Currently, the major domestic issue in the United States for the public is jobs. Polls show that very clearly. For the very wealthy and the financial institutions, the major issue is the deficit. Well, what about policy? There’s now a sequester in the United States, a sharp cutback in funds. Is that because of jobs or is it because of the deficit? Well, the deficit.

To take another example, the issue of minimum wage. The one view is that the minimum wage ought to be indexed to the cost of living and high enough to prevent falling below the poverty line. Eighty percent of the public support that and forty percent of the wealthy. What’s the minimum wage? Going down, way below these levels. It’s the same with laws that facilitate union activity: strongly supported by the public; opposed by the very wealthy – disappearing.

The same is true on national healthcare. The U.S., as you may know, has a health system which is an international scandal, it has twice the per capita costs of other OECD countries and relatively poor outcomes. The only privatized, pretty much unregulated system. The public doesn’t like it. They’ve been calling for national healthcare, public options, for years, but the financial institutions think it’s fine, so it stays: stasis.

One of the most interesting cases has to do with taxes. For 35 years there have been polls on ‘what do you think taxes ought to be?’ Large majorities have held that the corporations and the wealthy should pay higher taxes. They’ve steadily been going down through this period.

On and on, the policies throughout is almost the opposite of public opinion. The lower 70% on the wealth/income scale have no influence on policy whatsoever. They’re effectively disenfranchised. As you move up the wealth/income ladder, you get a little bit more influence on policy. When you get to the top, which is maybe a tenth of one percent, people essentially get what they want, i.e. they determine the policy. So the proper term for that is not democracy; it’s plutocracy.

Notes:

Gilens, Martin. 2005. “Inequality and Democratic Responsiveness in the United States,” Public Opinion Quarterly 69 (5): 778-796. (PDF)

Inequality and Democratic Responsiveness, Russell Sage Foundation: http://www.russellsage.org/research/inequality-and-democratic-responsiveness

http://www.princeton.edu/~mgilens/Gilens%20homepage%20materials/Gilens%20and%20Page/Gilens%20and%20Page%202014-Testing%20Theories%203-7-14.pdf

Please see similar study: Democracy and the Policy Preferences of Wealthy Americans by Benjamin Page, Larry Bartels and Jason Seawright: http://faculty.wcas.northwestern.edu/~jnd260/cab/CAB2012%20-%20Page1.pdf

About elpidiovaldes

Human, All Too Human.

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