Saturday, August 20, 2011

Human Behavior of the Stupidest Kind

Ever hear the saying: "Cutting off your nose to spite your face"? Middle-class/poor Republicans are proof of it, supporting the policies that keep the rich richer and take away benefits from themselves.  This article explains a possible reason behind it.  It's a small but meaningful switch from the "I got mine and I don't care if you get yours" to "I got mine and I don't want you to get yours."   

Are the Poor Standing In the Way of Tax Increases for the Rich?
By Robin M.

As we watched the debt ceiling battle unfold and Republicans fight tooth and nail to ensure that tax cuts for the wealthy were not rescinded, an overwhelming majority of the public felt that politicians were implementing economic policies that were being clamored for by the rich and the special interests.

But what if they had an ally no one suspected?  Could it be that many of those policies were supported by a chunk of the lower-middle class?

The Economist takes a look at how often, despite knowing that it would hurt their own prosperity, those who are on a lower rung of the economic ladder will find themselves supporting fiscal policies that will greatly benefit the rich simply to be sure that those who are struggling even more economically don’t “gain on them.”  It’s a fascinating look at how one swatch of society will vote against their own best interests just to make sure that someone worse off won’t potentially “beat them.”

Instead of opposing redistribution because people expect to make it to the top of the economic ladder, the authors of the new paper argue that people don’t like to be at the bottom. One paradoxical consequence of this “last-place aversion” is that some poor people may be vociferously opposed to the kinds of policies that would actually raise their own income a bit but that might also push those who are poorer than them into comparable or higher positions. The authors ran a series of experiments where students were randomly allotted sums of money, separated by $1, and informed about the “income distribution” that resulted. They were then given another $2, which they could give either to the person directly above or below them in the distribution.

In keeping with the notion of “last-place aversion”, the people who were a spot away from the bottom were the most likely to give the money to the person above them: rewarding the “rich” but ensuring that someone remained poorer than themselves. Those not at risk of becoming the poorest did not seem to mind falling a notch in the distribution of income nearly as much. This idea is backed up by survey data from America collected by Pew, a polling company: those who earned just a bit more than the minimum wage were the most resistant to increasing it.

As the gap between the rich and the poor continues to grow, this theory could shed light on why so many people in a time of need think that the best way to cut debt is to eliminate the social safety net rather than ask the wealthy to forgo their tax breaks.

In addition, the book What's the Matter with Kansas? gives another reason for this bewildering behavior on the part of Republican voters:  From an review:

By focusing attention on culture issues, the Conservatives not only distract their followers from economic concerns, they remove capitalism itself as an issue. For Red Staters, capitalism is a natural force, and free markets are an absolute good. Concerns about environment, globalization, estate taxes, Wal-Martization, health and welfare all disappear, since laissez-faire is an inviolable principle. Capitalism cannot and must not be regulated in this worldview, and any restrictions and regulations designed to "thwart" it are necessarily wrong if not evil. The fact that culture itself -- MTV, Hollywood, Howard Stern, Fear Factor -- is a capitalist product that follows the same profit motivations goes unnoticed. In Kansas, as in most places, there is no connection in people's minds between culture and capitalism.

Anyone who truly wants to understand today's upside-down political world, who wants to understand how middle class people can enthusiastically support tax cuts that give them nothing and the rich more money and power, should read WHAT'S THE MATTER WITH KANSAS? Mr. Frank offers clear and straightforward explanation of this bizarre phenomenon, and his insights and implications should send chills down the spines of those who espouse a free, fair, and open society. To quote Frank's closing line: that the "fever-dream of martyrdom that Kansas follows today...invites us all to join in, to lay down our lives so others might cash out at the top; to renounce forever our middle-American prosperity in pursuit of a crimson fantasy of middle-American righteousness."