January 19, 2012 4:00 pm ET - by Jamison Foser
The American Enterprise Institute's James Pethokoukis — last seen arguing that although Mitt Romney probably pays a lower tax rate than you do, the quarter-billionaire Republican presidential candidate is overtaxed — now credits investors like Romney for coming "to the rescue" of corporate America, leading to "America's 1980s revival."
According to Pethokoukis, "Romney and Bain [and other similar firms] created value and increased productivity, which is the only true economic security for companies and their workers." The idea that this increased productivity has led to "true economic security" for workers as opposed to corporate executives and investors who kept an ever-increasing share of profits for themselves is highly debatable, to say the least. Over the past three decades, wages for workers have stagnated and firms cut pensions and other benefits, further transferring wealth upward. Pethokoukis seems to think this is a good thing: He favorably quotes an analysis blaming poor 1970s productivity on "workers protected by strong unions [who] were able to extract wage gains." Curtailing wage gains for workers may have done wonders for corporate bottom lines and soaring executive pay, but it's a stretch to say it has led to economic security for workers with stagnant wages.
Arguably, the primary force that set off the 1980s upheaval in U.S. corporate restructuring was the deregulation begun by Jimmy Carter and continued by Ronald Reagan. Airlines, ground transportation, cable and broadcasting, oil and gas, banking and financial services all experienced regulatory rollback.
Again, it's rather debatable that this is actually a good thing. Economist Dean Baker, for one, argues that what is commonly referred to as deregulation is not actually a reduction in regulations but rather a shift towards "regulatory structures that cause income to flow upward," with strongly negative consequences for all but the very wealthiest Americans. (Baker explains at greater length in his 2011 book The End of Loser Liberalism: Making Markets Progressive.)
Just take another look at some of the industries Henninger identifies as beneficiaries of "regulatory rollback": Airlines, cable and broadcasting, oil companies, financial services. Are you happy with the performance of these industries over the past few decades? Probably not — they dominate lists of America's most-hated companies. Deregulation and increased emphasis on efficiency (read: corporate profits) may have been a boon to CEOs, but it's hard to look at the last 30 years and conclude that workers and consumers have similarly benefited.
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