The New Economic Populism

How States Respond to Economic Inequality

William Franko and Christopher Witko

Examines the ways states are better positioned to address income inequality
Utilizes public opinion polls and national survey data to assess perceptions about income disparities
Argues that what drives economic policy is the public perception of inequality

The New Economic Populism

How States Respond to Economic Inequality

William Franko and Christopher Witko

Description

Donald Trump's 2016 victory shocked the world, but his appeals to the economic discontent of the white working class should not be so surprising, as stagnant wages for the many have been matched with skyrocketing incomes for the few. Though Trump received high levels of support from the white working class, once in office, the newly elected billionaire president appointed a cabinet with a net worth greater than one-third of American households combined. Furthermore, he pursued traditionally conservative tax, welfare state and regulatory policies, which are likely to make economic disparities worse. Nevertheless, income inequality has grown over the last few decades almost regardless of who is elected to the presidency and congress.

There is a growing consensus among scholars that one of the biggest drivers of income inequality in the United States is government activity (or inactivity). Just as the New Deal and Great Society programs played a key role in leveling income distribution from the 1930s through the 1970s, federal policy since then has contributed to expanding inequality. Growing inequality bolsters the resources of the wealthy leading to greater influence over policy, and it contributes to partisan polarization. Both prevent the passage of policy to address inequality, creating a continuous feedback loop of growing inequality.

The authors of this book argue that it is therefore misguided to look to the federal government, as citizens have tended to do since the New Deal, to lead on economic policy to "fix" inequality. In fact, they argue that throughout American history, during periods of rapid economic change the federal government has been stymied by the federal institutional design created by the Constitution. The winners of economic change have taken advantage of veto points to prevent change that would address the problems experienced by the losers of major economic change. Even the New Deal, in many ways the model of federal policy activism, was largely borrowed from policies created in the state "laboratories of democracy" in the preceding years and decades.

The authors argue that in the current crisis of growing inequality we are seeing a similar dynamic and demonstrate that many states are actively addressing economic inequality. William Franko and Christopher Witko argue that the states that will address inequality are not necessarily those with the greatest objective inequality, but those where citizens are aware of growing inequality, where left-leaning politicians hold power, where unions are strong, and where the presence of direct democracy allow for more majoritarian public policy outcomes. In the empirical chapters Franko and Witko examine how these factors have shaped policies that boosted incomes at the bottom (the minimum wage and the Earned Income Tax Credit) and reduce incomes at the top (with top marginal tax rates) between 1987 and 2010. The authors argue that, if history is a guide, increasingly egalitarian policies at the state level will spread to other states and, eventually, to the federal level, setting the stage for a more equitable future.

The New Economic Populism

How States Respond to Economic Inequality

William Franko and Christopher Witko

List of Tables and Figures
Chapter 1 - Introduction
Chapter 2 - Economic Inequality, Federalism and the New Economic Populism
Chapter 3 - Growing Inequality and Public Awareness of Inequality in the States
Chapter 4 - Awareness of Inequality and Government Liberalism
Chapter 5 - Taxing the Rich: The Initiative, Attitudes toward Inequality, and Washington's Proposition 1098
Chapter 6 - State Responses to Federal Inaction and Growing Inequality: The Case of the Minimum Wage
Chapter 7 - Building on Success: The Case of the Earned Income Tax Credit
Chapter 8 - The New Economic Populism and the Future of Inequality in the U.S.
Appendix A - Measurement and Methodology
Appendix B - Data and Results
Notes
References
Index

The New Economic Populism

How States Respond to Economic Inequality

William Franko and Christopher Witko

Author Information

William Franko is Assistant Professor of Political Science at West Virginia University.

Christopher Witko is Associate Professor of Political Science at University of South Carolina.

The New Economic Populism

How States Respond to Economic Inequality

William Franko and Christopher Witko

Reviews and Awards

2018 Virginia Gray Best Book Award, American Political Science Association State Politics and Policy Section

"William W. Franko and Christopher Witko have written an important book that documents the interconnections among income inequality, mass opinion, and politics and policy in the American states. They bring a wealth of data and methodological sophistication to bear in building our understanding of the interplay among these concepts. This is a must-read for scholars and political observers interested in understanding the political economy of who gets what, when, and how in the face of income inequality in the American states." --James C. Garand, Emogene Pliner Distinguished Professor, Louisiana State University

"Franko and Witko offer a deft overview of the depth of economic inequality in the United States, the implications and political causes, and the lack of response from the federal government. They also show how and why the states have taken the lead in responding to rising inequality. As the U.S. faces inequities not seen since the Gilded Age, The New Economic Populism provides critical insight into both the history and future of government response to inequality." --Peter K. Enns, Associate Professor of Government, Cornell University

"Franko and Witko bring together much of the literature on the politics of inequality in a data-rich and rigorous analysis that capitalizes on variation across states to map the ways in which inequality serves as both a cause and consequence of much of American politics. Further, they extend this work by theorizing directly about state governments and states' particular role in the political processes shaping economic inequality-particularly in the face of well-documented federal inaction and gridlock." --Elizabeth Rigby, Associate Professor of Public Policy and Political Science, The George Washington University