Democracy’s redistributions function as asset insurance for the rich.

Evidence

If you reside in the middle or the bottom half of the income and wealth distribution, you rely on government services, both indirect (tax breaks and subsidies) and direct (transfers, public transport, public education, health care). These are the transfers across the income distribution that make the notion of a middle class possible. They don’t just happen by accident. Politics makes them happen. Americans did not wake up one morning to find that God had given them a mortgage-interest tax deduction. Those further up the income distribution who have private alternatives (and more deductions) are obviously less reliant upon such services, but even they will eventually feel the consequence of cutting state spending as the impact of austerity ripples back up the income distribution in the form of lower growth, higher unemployment, withered infrastructure, and an even more skewed distribution of resources and life chances. In essence, democracy, and the redistributions it makes possible, is a form of asset insurance for the rich, and yet, through austerity, we find that those with the most assets are skipping on the insurance payments. — Mark Blyth, Austerity, 60

Categorization

• ADDENDUM: The ‘asset insurance for the rich, skipping on payments’ framing reworks the sacrifice/morality theme central to the reader’s sacrifice piece, casting austerity as the rich defaulting on their obligations.
• XREF: The claim that the middle class is an artifact of political transfers connects to Mattei’s account of state-led economic governance being dismantled by austerity. — connects to: The rich are as trapped by economic rationality as the poor — Theodor W. Adorno, Minima Moralia: Reflections from…, 193; Direct democracy in practice is captured by moneyed interests despite its populist intent. — Lawrence M. Friedman and Grant M. Hayden, American Law: An Introduction, 447; Democracy’s classic perversion is the poor governing against the rich — Charles Tilly, Regimes and Repertoires, 76

Broader Connections

• The rich are as trapped by economic rationality as the poor #corroborates (0.72) — Theodor W. Adorno, Minima Moralia, 193