Regression Analysis

The contest between Obama and Clinton has made it clear that the Democratic Party has two distinct bases.  Michael Barone calls them the Jacksonians and the academics.  In the past, these bases were simply part of a broad coalition, but the recent primary exposed that they tend to vote as a block and different candidates appeal to--and represent--each base.

On the Obama side, we have the hip, young, savvy metrosexuals plus the Academic elites including professors, lawyers, doctors and members of the media.  On the Hillary side, we have the "traditional" Democrats: working class, union (including government employees and teachers) plus inner city and minority members.  (Obama, obviously skews this a bit since he also draws heavily from black voters.)

The extended Democratic Primary combined with Napolitano's surprise support of Obama have helped to explain what to me has been a deep mystery...why are Governor Napolitano's proposals so regressive?  Why does it always seem like her programs benefit the rich and middle class while the revenue for those proposals are generated from the poor and working class?

The starkest example is her program to spend a billion dollars on the universities, financed by bonding increased lottery revenues.  That's a direct transfer from Clinton Democrats to Obama Democrats, Jacksonians to academics, or if you prefer, those who can't do math to those who can.  Add in her other proposals:  higher court fees, more photo radar tickets and higher cigarette taxes and the targeting of the poor becomes more obvious. 

Much of the incremental revenue from her initiatives funds things that benefit the academic elite--university construction, ASU med school and investments in biotechnology.  Even her programs that don't have a direct cost,  setting aside state trust land for example,  have benefits that accrue almost exclusively to the rich. 

To be sure, not all of Napolitano's programs involve transfers from the poor to the rich.  Some of them involve transfers from the poor to the middle class.  The poor already have access to all day kindergarten and health care.  Napolitano's expansion of those programs simply opens them up to the soccer moms.

The TIME initiative is another example of a regressive policy whose costs are borne disproportionately by the poor and whose benefits inure primarily to the rich and middle class.  Sales taxes have long been understood to be regressive.   Everyone buys food, but the poor spend their incremental money on things that are taxable.  At the margin, the rich and middle class spend their money on things that are not taxable--services, big houses, private school tuition and their 401K. 

Who do you think benefits from those suburban freeways, environmental enhancements, and sexy rail lines?  It's not the poor.  The women who clean the Point at South Mountain need expanded Sunday bus service so they can get back to Guadalupe in time to get their kids ready for Mass.  They don't need a fancy train from Downtown Phoenix to ASU.

In fact, the wealthier people are, the more likely they are to be Napolitano supporters and the more likely they are to have benefited by Napolitano's programs. 

Now it seems that there are no longer any Democrats who understand that selling more lottery tickets to build university buildings isn't the best public policy. 

So now I understand.  Obama wins.  Napolitano wins.  The professors, doctors, lawyers, hip urban professionals and media elite win and the poor pay the price...the new politics of redistribution. 

Now that's change  you can believe in.   

 

Comments

[CQ]

Well done. Very well done.

[ron]

Greg, you wrote, "Everyone buys food, but the poor spend their incremental money on things that are taxable."

Interesting analysis. This isn't the line that the Goldwater Institute and other conservative think tanks would tell us.

[todd]

I would take issue with the idea that a certain class benefits from environmental concerns. I also think the university building and transportation plans are large work programs - i don't think they are actually helping raise salaries of academics and I doubt wealthy people are going to stop driving their SUVs to take light rail.

However, I very much agree that paying for these through sales taxes and expanded lottery is horrible. Could they have been paid for through raising income taxes or business taxes (the latter coming from a group which would also benefits from many of these things as well)? Then again, I don't think you would agree with these as the argument would then be that these taxes are just passed on to ordinary consumers.

[SonoranSam]

"The poor already have access to all day kindergarten and health care....."

Really?

When was the last time you were in a South Phoenix classroom? And if you mean the poor have access to health care because of AHCCCS - or because they can visit an E.R. when they're sicker than a dog - you have a different definition of "access" than I do.

[ron]

About that access to healthcare - that works if you don't make enough to go over the AHCCS limit such as working at Walmart. Of course, if you don't have healthcare at work and have any pre-existing conditions and you make too much for AHCCS, pray real hard you or your family don't get sick.

[ron]

Greg, you wrote, "So now I understand. Obama wins. Napolitano wins. The professors, doctors, lawyers, hip urban professionals and media elite win and the poor pay the price...the new politics of redistribution."

I thought that was called 'trickle down'. :)

[The Klute]

"Everyone buys food, but the poor spend their incremental money on things that are taxable."

Because the second anyone talks about increasing/creating luxury/sin taxes, the right-wing starts screaming about "class warfare" (nevermind the fact, the ACTUAL class warfare, as you've noted, is against the poor, and always has been).

"On the Obama side, we have the hip, young, savvy metrosexuals..."

Yeah, Iowa and Montana are known for being the new Seattle. In fact, John Deere just put out a new line of hair gel last week.

"...setting aside state trust land for example, have benefits that accrue almost exclusively to the rich."

How, exactly?

"The poor already have access to all day kindergarten and health care."

Man, the poor get all the breaks! When does the rich man finally get a break? When?

[Aaron]

It's an interesting perspective, but to be fair, she has a legislature more concerned with social wedge issues than the plight of poor people. Consequently, she has to work around them to effect any changes at all. I do agree that any and all of us can be somewhat elitist and forget what it's like to be poor.

[Steve Rogers]

Politics is the art of possible. When she first came into office, Napolitano had a committee study how to revamp the entire tax system to bring it in line with the modern economy. That would mean raising some taxes and lowering others.

But because Greg's team refuses to consider any tax increase--no matter what--Arizona is stuck with the current tax system, so the only place to go is with the lottery, speeding tickets and sin taxes. Personally, I think it sucks, but you can't blame Janet for working within the system she's got.

[Travis]

S.R.,

It took me a minute to stop laughing over your contention that Janet found it so hard to raise our taxes. Both the governor and the legislature (with a few exceptions) have found great ease in the ballooning of our taxes. Have we had to pay them all yet? No, but just wait...

When the governor spends our surplus, increases the size of government and pays no attention to the decline in revenue, then our taxes just went up. Janet simply found ways to make it so the bill doesn't come due until she's outta here.

[KES]

Funny to see a Republican complain about spending and deficits. The last three Repbulican adminstrations, Reagan Bush and Bush, created larger deficits than ever seen in this country before. They cut taxes to the rich, and fed off the poor.

Now we have the kettle calling the pot black.