Thursday Morning Links

This and that for your Thursday reading.

- Neil MacDonald discusses the unfairness in allowing a wealthy class of individuals to set up its own rules, while Jeffrey Sachs notes that the U.S. and U.K. are among the worst offenders in allowing for systematic tax evasion. And Alex Hemingway rightly points out that the recognition that a privileged few are able to flout the law makes it more difficult to establish the trust needed for society to function.

- Meanwhile, Jared Bernstein highlights the costs of trade agreements in transferring wealth and power to those who already have the most, while noting there are other factors which need to be counterbalanced as well:

There are a lot of forces other than global trade suppressing the earnings and opportunities of large swaths of workers, but trade is often the most visible one. Most economists think the lion’s share of wage inequality and stagnation is because of changes in technology that have increasingly tilted against noncollege educated workers, and Froman is saying that there’s nothing much in the way of technology dynamics against which opponents can rally.

In fact, there’s less in the way of solid, ADH-style evidence that technology is a lead culprit here. The decline of unions, eroding minimum wages, the rise of non-productive finance, and especially the persistent absence of full employment labor markets all reduce worker bargaining power, and that is the fundamental force driving wage stagnation amid growth. But Froman’s point that trade bears a disproportionate share of the public’s anger is a good one.

Still, the main message from ADH, Bivens, and the rest of us who’ve been trying to raise this cost side of the equation for decades is that these costs are real. They’re acute for many people and places and diffuse to some degree for others. Economic platitudes about how trade is always worthwhile as long as the winners can compensate the losers are an insult in the age of inequality, where the winners increasingly use their political power to claim ever more winnings.

If we don’t deal with these costs by creating real, substantive, remunerative opportunities for those hurt by trade, some demagogue is sure to come along Trumpeting a case for xenophobia, walls, tariffs and protectionism. If he’s not … um … here already.

- Matthew Yglesias theorizes that work is getting safer and more fulfilling with time - which may explain in part the lack of a concerted effort to further reduce the time spent on the job.

- David Wheeler offers his take on a universal basic income, while Allan Pall writes that social programs are instead headed toward exclusion of youth among other groups.

- Finally, Thomas Walkom reminds us of the importance of putting extreme weather events such as the Fort McMurray wildfire into the context of the environmental factors which cause them. And Martin Lukacs suggests that the cost of cleaning up and rebuilding should be borne by the industry most responsible.