Monday Morning Links

Miscellaneous material to start your week.

- James Galbraith reminds us of the danger extreme inequality poses to any social bonds - and the need for political action to counteract the current momentum toward further concentration of wealth:

Controlling inequality—like controlling blood pressure—is good for your economic health. Economies with less inequality generally have lower unemployment and stronger productivity growth, and some researchers also claim better human health and social cohesion. In terms of the rest of the world, the peculiar organization of the United States into a boom/bust economy based on finance and high technology is the exception rather than the rule: We combine record-breaking inequality with low unemployment. But this is a formula that generates massive instability, as well as the resentments that gave us President Trump. Countries with stronger stabilizing institutions built on the principle of countervailing power may be less rich over the short term, but they are better-governed and built to last.
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The US government, in short, needs to break away from the grip of concentrated financial power and from the illusions of dominance that come with feeling exceptional, invincible, and rich. Financial power has an interest in instability at home and abroad. It has an interest in seeking to dominate what can no longer be dominated. It is therefore a vector for depredation and for conflict, neither of which we can afford—especially in an era of existential risks to the environment, through climate change, and to the future of life on the planet, through nuclear war.

Ultimately, therefore, this is a political struggle. “Wealth, as Mr. Hobbes says, is power,” notes Adam Smith in The Wealth of Nations. And Thomas Hobbes was right; anyone who observes the US political scene knows this, as does anyone who participates in American politics. In the end, inequality—both in the United States and around the world—is a problem that can only have a political solution.

- Robert Kuttner argues that the Trump Republicans' giveaway to their obscenely wealthy donors should be the central issue of the U.S.' midterm elections. And Peter Whoriskey discusses how the monetization of poverty by a predatory financial sector is only making inequality all the worse.

- Martin Sandbu explores the idea of a jobs guarantee, but argues that it's a less desirable alternative to a basic income which would ensure that personal financial security isn't tied to work alone. And Bernadette Meaden discusses the UK Cons' shameful determination to take any source of support away from some of the people who need it most.

- Finally, Roger Noll and Robert Litan respond to Donald Trump's attack on supply management by pointing out the false claims behind it.