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Nader’s Pitch for a Left-Right Convergence

Wednesday, May 28, 2014

Ralph Nader’s new book shows his zeal for finding and promoting left-right solutions.

Ralph Nader turned 80 in February and just last month came out with his twelfth book. It’s titled Unstoppable: The Emerging Left-Right Alliance to Dismantle the Corporate State. The book, as he writes, explores “the topic of convergence, which I take to be voluntary alliance for the common good by positive-spirited persons of the Right and the Left.”

The very premise is exhilarating. I have recently come to agree with the psychologist Jonathan Haidt that, in politics, we play on teams, and the players on one team generally detest the other team to such a degree that they pay no attention to what the other team’s players have to say. As Haidt puts it: 

Morality binds and blinds. It binds us into ideological teams that fight each other as though the fate of the world depended on our side winning each battle. It blinds us to the fact that each team is composed of good people who have something important to say. 

The notion that people on the Left think that people on the Right are in any way “positive-spirited” (and vice versa) sounds almost antique. Yet here is Ralph Nader saying it and believing it.

Some of the convergence is merely the old phenomenon of left-wingers being so far left that they come out on the other side (and, again, vice versa), a sort of ideological Mobius strip. It is no surprise, for instance, that both ultra-liberals and ultra-conservatives can be similarly protectionist and isolationist, though for different reasons.

But much of the book covers the important ground of corporate cronyism, where conservatives have become sick to death of rent-seeking, regulatory capture, and the entire menu of activities in which business colludes with government to the detriment of free minds and free markets. In the book, Nader writes:

During a debate with Ronald Reagan in 1977, sponsored by the American Enterprise Institute, I elicited from him a clear distaste for government propping up business. He noted that he kept telling his corporate friends not to have their hands in Washington’s trough. He cited as an example of unwanted corporate giveaway the Jones Act, which restricted US port-to-port shipping to US-flag ships, thereby keeping shipping rates high.

The Jones Act is still with us, an artifact — today, anyway — more of union than of corporate power, but you get the point. “Corporate friends” can’t resist putting “their hands in Washington’s trough” — even though, in the end (to continue the metaphor), some crocodile jumps out of the trough to bite them on the snout. This is a good warning, for example, to the technology companies that are currently begging the Federal Communications Commission to regulate the Internet as a public utility.

Yesterday, Nader held a standing-room-only 9-to-5 conference at the Carnegie Institute called “A Gathering of Left-Right Convergence.” There were panels on “Wall Street Crime and Misdeeds,” “Corporate Welfare,” defense, trade, the “Commercialization of Childhood” — with lefties and righties represented, and generally agreeing. Judson Phillips of Tea Party Nation, Lori Wallach of Global Trade Watch (one of Nader’s own organizations), Grover Norquist of Americans for Tax Reform, Miriam Pemberton of the Institute of Policy Studies, and on and on.

Nader asked me to moderate the panel on the minimum wage, with Jim Hightower, the former Texas Railroad Commissioner, and, according to his official biography, “a modern-day Johnny Appleseed, spreading the message of progressive populism all across America,” and Ron Unz, founder of a financial services software company, former publisher of the American Conservative, and an often quirky right-winger who has fought to dismantle bilingual education and now has gotten an initiative on the ballot to raise California’s minimum wage to $12 an hour.

Senate Republicans on April 30 blocked an attempt to raise the minimum wage to $10.10, but some in the party are breaking ranks, including former presidential candidates Mitt Romney, Tim Pawlenty, and Rick Santorum.

It’s safe to say that Left and Right start with the notion that Americans should make enough to live decently. Milton Friedman, whom the economist Cornell Robert H. Frank called “a generous and compassionate man” in his 2006 obituary in the New York Times, came up with the idea of a negative income tax as the solution; it would have gone to non-workers as well as workers and substituted for a variety of welfare programs. That concept elided in 1975, under President Ford, into the earned-income tax credit, with strong bipartisan support. The EITC today gives married couples with two children up to $6,143 in refundable tax credits. The EITC phases in at $13,430 for such a family, peaks at an income of $23,260, and phases out at $52,427.

The EITC is far preferable to the minimum wage as a way to top up low incomes, as many have shown, most elegantly Gregory Mankiw earlier this year. Mankiw made two points: first, if a decent wage is a matter of social justice, then all taxpayers should share in paying for it, and, second, if employers are forced to foot the bill for higher wages, they will substitute machines or higher-paid or offshore workers for some of those making minimum wage.

The Congressional Budget drew much the same conclusion in a report in February. “Once fully implemented,” said the CBO study, “the $10.10 [per hour] option would reduce total employment by about 500,000 workers.”

It’s safe to say that Left and Right start with the notion that Americans should make enough to live decently.

But Hightower and Unz would have none of it. Their contention was that businesses are rolling in dough, their CEOs are making a mint, and they have plenty to give to the folks making $7.25. They want to see social justice, yes, but they want the bosses to pay for it. And President Obama wants both a 39 percent minimum wage increase and a wide expansion of the EITC and the Child Care Credit. (The president wants the EITC to be apply to childless adults — a position also supported by Aparna Mathur and Abby McCloskey in a recent AEI paper.)

If we want to find the common ground that Nader so earnestly desires, we have to shed some of our ancient baggage and reach an obvious conclusion: in order to top up wages, the best method is through the tax code, not through compelling businesses to hire people at government-mandated prices.

This argument, unfortunately, made little impression on the audience that Ralph had gathered, but the cause itself — convergence — is admirable as hell, and I salute Nader both for his book and for his zeal in finding and promoting left-right solutions. His first book, Unsafe at Any Speed, a bombshell published 49 years ago, exposed the scandal of the unsafe Corvair and, more important, launched the consumer movement. He’s onto another good thing with his latest.

James K. Glassman is a visiting fellow at the American Enterprise Institute and is the founding executive director of the George W. Bush Institute.

 
FURTHER READING: James K. Glassman also writes "U.S. Leadership Rating Rises. Huh?" and "The Obamacare of Real Estate." Andrew Biggs and Mark J. Perry contribute "A National Minimum Wage Is a Bad Fit for Low-Cost Communities." Arnold Kling explores "The Reality of the ‘Real Wage.’"  

 

Image by Dianna Ingram / Bergman Group

 

 

 

 

 

 

 

 

 

 

 

 

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