Authors Meet Critics: Bias towards the Wealthy – Wage and Fiscal Policy in Comparative Perspective

Session Submission Type: Author meet critics

Session Description

This panel puts in dialogue three recent books working on the issues of political inequality and social and political inclusion from different perspectives and in different regions (US, Europe, and Latin America). The three books engage with questions of distributive conflict and how it is processed in the political system. By analyzing legislative decisions and exploring the influence of different actors and dominant ideas in the policymaking process, the three books demonstrate how these processes tend to be biased towards the wealthy. The books also explore the political consequences of these decisions as well as their causes, focusing on long- and short-term factors and processes shaping policymaking. The panel proposes a cross-regional perspective, engaging in comparing policymaking in the United States, Europe and Latin America.

"Hijacking the Agenda" (Christopher Witko, Jana Morgan, Nathan J. Kelly, Peter K. Enns; Russell Sage Foundation) analyzes over 20 years of floor speeches by thousands of members of Congress to examine how campaign contributions and independent expenditures on behalf of candidates help set the national economic agenda. Legislators receiving more support from business and other wealthy interests were more likely to discuss the deficit and other upper-class priorities, while those receiving more assistance from unions were more likely to discuss issues important to the lower and middle class, such as economic inequality and wages. The book develops these ideas further using case studies analyzing financial regulation and the minimum wage to demonstrate how the economic power of the wealthy enables them to advance their agenda. It documents how and why economic policy is skewed in favor of the rich. While unions use their resources to push back against wealthy interests, spending by the wealthy dwarfs that of unions, often giving the upper class the upper hand. The argument suggests that this attention imbalance matters because when members of Congress talk about certain issues, their speech is often followed by legislative action.

Austerity became the predominant fiscal policy response to the Great Recession in Europe. After a brief period of 'emergency Keynesianism' from 2008 to 2010, even the centre-left abandoned plans for deficit spending and accepted austerity as the dogma of the day. In "Austerity from the Left" (Oxford University Press), Björn Bremer explains how this came about and explores its political consequences, combining qualitative and quantitative methods and drawing on a wide range of empirical evidence to study both the demand- and supply-side of politics. The book argues that a complex interaction of electoral and ideational pressures pushed social democratic parties towards orthodox fiscal policies. As government debt became taboo following the Greek sovereign debt crisis, social democratic parties endorsed austerity to increase their perceived economic competence and fiscal credibility. This decision was legitimized by economic ideas inspired by supply-side economics, which had become popular among social democrats at the end of the twentieth century. Powerful feedback effects of the Third Way thus trapped and divided the centre-left during the crisis. This undermined the ability of social democratic parties to oppose austerity and eventually contributed to their electoral crisis in the shadow of the Great Recession.

"Empowering Labor" (Juan A. Bogliaccini, Cambridge University Press) uses a comparative study of Chile, Portugal, and Uruguay to analyze the underlying political dynamics that shape the use of wage policy as a pre-distributive instrument of leftist parties in power in unequal democracies. The book theorizes that the unity of the Left and labor's political legitimacy are two main drivers for shaping wage policy as a pre-distributive instrument for promoting political inclusion. These factors are influenced by long-term elite strategies towards labor. Such strategies, when dominant for long-enough periods, create path dependency, shaping differential opportunities for further options down the road. The book integrates large-scale historical processes with frequently analyzed short-term and agency-based factors to elucidate variation in the crafting of wage policies and reshapes the debate on the politics of pre-distribution in unequal democracies by situating the cases in a longer historical arc.

Together the books provide a comprehensive analysis of elite influence in policy processes. By placing them in direct conversation, this panel will draw together these insights and open up new lines of cross-national comparison.

Sub Unit

• Division 11: Comparative Politics

Chairs

• Juan Ariel Bogliaccini Universidad Católica del Uruguay

• Jana Morgan University of Tennessee, Knoxville

• Björn Kristen Bremer Central European University

Presenters

• Candelaria Garay Cornell University

• Kenneth M. Roberts Cornell University

• Bryan D. Jones University of Texas at Austin