Traditionally, the Republican and Democratic parties have disagreed on how to deal with the American economy. I know, who would have guessed the two would ever disagree? Republicans have traditionally favored the “trickle down” approach whereas Democrats traditionally prefer a system known as “pump priming.” However, in recent years (I couldn’t tell you precisely when), it has not been this easy to distinguish between the two.
To briefly explain the two, I will generalize each and give examples of where our nation’s finest (+sarcasm) have critiqued each other’s views on the economy. “Trickle down” is a policy in which funds, usually in the form of tax breaks, are given to large corporations with the thought that large industries with extra cash will hire more people within their organization in order to make more of their product. With more of their product, they can make more sales, make more money, and employ more people. In essence, funds given to large businesses eventually make their way from the top (large business) to the bottom (working class).
Obama criticized Romney saying that this nation cannot afford a president that will “double down on trickle down,” because in his opinion, “that’s what got us into trouble in the first place.”
“Pump priming,” is almost the exact opposite of the last policy. Instead of starting at the top, Democrats have traditionally funded programs that put money into the pockets of the working class. This policy assumes that working class individuals with extra cash will go into the market and make purchases. Through these purchases, money is circulated from the working class up to big business through the products they are selling. Romney has criticized this policy by making several comments about “government handouts,” like the now infamous comment about 47% of Americans that don’t pay income taxes.
Something interesting, however, is that President Obama (at least through his speeches) does not fully conform to one of these policies, and no, I am not just referring to the large sums of money he spends. At the DNC, he made a comment completely different to the previously mentioned policies. Instead of “trickling down” or “pump priming,” he said that the economy needed to grow from “the middle, out.”
Now, whether or not he believes this, or will make any actions towards this type of policy, is beside the point. The fact that it was said is important. When it comes down to it, the middle class is very important to America, and is at the same time on the decline. You see, the middle class is the class that gets educated, innovates, and starts reform. They do not get large sums of money left to them and thus have to get an education if they wish to do well financially. With their educations, they invent and improve upon modern technologies. While they are not rich, they do well enough financially to have free time from working in which they can spend on charity and social reform (not to mention the time to study politics and their government).
Protecting the middle class is very important to American well being. Unfortunately, I do not see a lot of Republicans grabbing on to this idea. Why? Well, because Obama said it, and frankly, the two parties never agree. I do not believe that economic growth from “the middle, out” is a Democrat or Republican centered policy. It is simply the most logical solution to the enormous problem of middle class decline.