The Democratic Party has made “income inequality” a signature issue for the 2014 (and, presumably, 2016) election cycle. Democrats, en masse, shout “J’accuse!” at Republicans. There is a very different story to tell.
“Income inequality” is a crude, and twisted, heuristic for stagnant median family income. “Income inequality” does not really resonate with voters, as noted by the Washington Post‘s own Catherine Rampell, with a mountain of evidence showing that Americans don’t begrudge the wealthy their wealth, just are frustrated at the lack of widespread economic opportunity.
So let’s get down to cases. Stagnant median family income is not the GOP’s fault. It’s the Fed who done it.
The Atlantic Media Company’s Quartz recently claimed that the Fed has been intentionally keeping a lid on wages. This has potentially major political implications. Among other things, this view would allow the Republicans to push the discourse back toward the real problem, wage stagnation. It can serve to refocus the Congress on the real solution, restoring real, rule-based, integrity to monetary policy as a way to get America moving again.
A culpable Fed gives irony to the fact that it is the Democrats that protect the Fed as if it were the Holy of Holies of the Temple. What if, as asserted inQuartz, the Fed, by policy, and not the GOP, is the source of wage stagnation? This opens an opportunity for the GOP to parry the political narrative of “income inequality” and feature the real issue on the mind of the voters and forthrightly to address its core cause, poor monetary policy.
This has been slow to happen because Federal Reserve has exalted prestige. The elite media has a propensity to canonize the Chair of the Fed. Media adulation has obscured the prime source of the stagnation besetting American wage earners for the past 43 years.