A new state-level study suggests that economic inequality and political polarization create a vicious cycle … greater inequality creates more polarization, which creates greater inequality. (More)

Inequality and Polarization, Part I: A Vicious Cycle

This week Morning Feature considers the relationship between economic inequality and political polarization. Today we look at a new state-level study that shows a strong and causal correlation between these two rising trends. Tomorrow we’ll explore reasons for the correlation, including the role of conservative religion. Saturday we’ll search for solutions to escape the current vicious cycle.

“Democrats from President Obama on down”

The results of a new study about political polarization delighted conservatives:

At least since the 2010 midterms, it’s been a liberal talking point that Republican extremism is to blame for political polarization and gridlock. In the old days, the argument goes, Republicans were a moderate party, but over the past generation the GOP has been gradually taken over by its far-right wing. Before the last GOP debate, for example, the Center for American Progress launched a “Right of Reagan” campaign to supposedly show “how the extremism of today’s Republican presidential candidates sets them apart from their conservative idol.”
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Now, a paper on polarization and inequality released in August by political scientists from Princeton, Georgetown, and the University of Oregon (and highlighted this week in a Washington Post article) provides some empirical evidence that Democratic Party’s leftward drift is more pronounced than the GOP’s rightward drift, at least at the state level.[…]

So while Democrats from President Obama on down often give the impression that their party is moderate and in line with public opinion while Republicans have undergone a sudden jolt to the right, it may not be that simple. Our discussions about polarization need to reflect the fact that it is a bipartisan affair.

It’s pretty clear that American Interest writer read only the Washington Post article, and not the original research, because the research never mentions President Obama and says very little about Democrats in Congress. But other right-wing bloggers gleefully cited the American Interest article as their original source.

“They’re really deep structural problems”

So let’s see what Washington Post Wonkbook’s Ana Swanson actually wrote:

But new research by Nolan McCarty, a professor at Princeton University, and other political scientists suggests this disgust – and America’s political dysfunction – won’t be that easy to fix. Working with political scientist Boris Shor and economist John Voorheis, McCarty has released a new study that shows that the growing ideological gap between the Republican and Democratic parties – a common obstacle to getting anything done in Washington – is not just due to politicians’ incompetence or their unwillingness to work together. It’s due, at least in part, to a deeper, structural problem: the widening gap between the rich and poor.

McCarty says he shares some of the disgust that Americans feel about polarized politics and gridlock in Washington. “But I think it’s important for readers and voters to understand … that these problems are not just simply because career politicians are acting in bad faith or, as Donald Trump would say, they’re stupid losers. They’re really deep structural problems,” he says.

Swanson continues:

Interestingly, however, the study shows that inequality is affecting the two parties in different ways.

First, the researchers find that Democrats as a whole have shifted farther to the left than the Republicans have to the right, with very liberal Democrats becoming even more liberal. But at the level of the state legislature, they find that ideology as a whole has shifted slightly to the right. The reason is that there has been a change in the partisan balance, with Republicans winning more seats from moderate Democrats over time.

“As the Democrat party has shrunk nationally over the course of the last 15 years, the disproportionate effect has been the replacement of moderate Democrats with Republicans, and that has tended to happen most often in states with high levels of inequality, or where inequality is growing the fastest,” McCarty said.

That almost seems to justify the right-wing bloggers’ glee. Except that’s not quite what the study found.

“Income inequality affecting polarization by ‘flipping’ moderate districts from Democratic to Republican control”

First, the bulk of the study did not attempt to track changes in individual state legislators’ ideologies. Indeed the bulk of the study assumes that individuals’ own ideologies are constant over time. Rather, the study tracked changes in the median of each party’s state caucus:

Although we cannot always formally reject symmetry in the effect of inequality on party medians, our results suggest of a larger effect of inequality on Democratic party medians. When allowing for systematically different effects in on-years [when elections are held] and off-years, we find that any effect of inequality on Republican party medians seems to occur in off-years, working through retirements or defections. However, we find that income inequality moves the median of the entire legislature to the right, and increases the proportion of seats held by Republicans. These results are consistent with income inequality affecting polarization by “flipping” moderate districts from Democratic to Republican control, and which are roughly the same districts highlighted by Rodden et al. (2015) as being important for explaining polarization.

So increasing inequality does not correlate to “very liberal Democrats becoming even more liberal.” Instead, it correlates to centrist Democrats in swing districts being replaced by Republicans. Those centrist Democrats are still centrist, but they’re no longer in office and no longer factor counted in the median ideology of their state’s Democratic legislative caucus.

Similarly, the study found that these swing districts elected Republicans who were as conservative as Republicans from conservative districts in their states … so adding them to the state’s GOP caucus didn’t move the GOP median much at all. But they did move the overall legislature to the right.

“This diminishes both the appetite and ability of state legislatures to engage in redistribution, which in turn further increases income inequality”

Only at the end did the authors try to assess changes in individual legislators’ ideologies. This required a different tool for measuring ideology, and they were less confident about that tool. But insofar as that tool gives meaningful data, they found:

We also examine the effect of income inequality on individual legislator ideology, allowing us to explore further the inequality-polarization relationship. Income inequality between districts and inequality within districts differentially affect legislators of the two parties. Within-district inequality shifts Republican positions but not those of Democrats, and the opposite is true for between-district inequality, which moves Democrats but not Republicans. This suggests different mechanisms for the two components of inequality: between-district inequality may affect ideology through demands for redistribution, while within-district inequality may affect ideology through shifting the ideology of large campaign contributors to the right, as theorized by Feddersen and Gul (2014).

In other words, the greater the inequality between rich and poor districts, the more that Democrats statewide will respond to demands for policies to address inequality. Conversely, the greater the inequality within a district, the more that big-money donors in that district will pull that Republican legislator to the right.

So rising inequality creates wider polarization … and wider polarization fosters yet more inequality:

Together, these results deepen our understanding of the relationship between income inequality and political polarization. Our findings are consistent with a political reinforcement mechanism for the propagation of inequality: increases in income inequality move the entire legislature to the right, while at the same time increasing political polarization. This diminishes both the appetite and ability of state legislatures to engage in redistribution, which in turn further increases income inequality.

Specifically, the authors find that income inequality will increase unless government takes action to redress it … and government is less likely to take that action when conservative Republicans control the legislature and only liberal Democrats remain in office. So inequality continues to increase …

… and more swing districts flip from centrist Democrats to conservative Republicans. We’ll explore why that happens tomorrow.

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Photo Credit: Getty Images/iStockphoto

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Happy Thursday!