Take the following hypothetical situation. I am a member of the bottom 80% or even of the bottom half of the economic pyramid. I can choose between two major parties. The first major party we'll call the Tweedledum Party. Economically it wants to help the corporations and the top 1%, while socially it pays lip service to the nativist and know-nothing wings. The second, Tweedledee Party wants to help the people in the 90th to the 99th percentile, and also give a few crumbs to folks at the bottom who are being squeezed. The Tweedledee Party also favors handouts to the corporations because corporations provide the bulk of funding in our political system. This party is cosmopolitan in outlook and is more sympathetic to non-native groups, such as immigrants and is even open to the views of some foreigners like the British and our traditional allies.

Clearly, the Tweedledee Party aims to benefit a larger cross section of the American public than the Tweedledum Party; however, that is not my question. My question is, which party's policies would help me more and hurt me less vis-a-vis the other economic classes if I am:

1. Between the median (50th percentile) and 80th percentile

2. At the 25th percentile. (Below the 25th percentile it is unlikely that I would even be posting here).

First off, I am interested in relative advantage because I assume that the economy is mostly a zero-sum game; that benefits to one groups are either dilutive or saddle other groups with added debts. True, Bill Clinton showed that a virtuous circle could benefit all groups, but this is not normally how it works. When Reagan benefited the top 1% litle trickled down to the bottom half, and in any event tricklism is a demeaning notion. Someone once likened it to feeding the birds by feeding the horses. I think it is immoral that government would aim to help the more fortunate at the expense of the less. Yet, that is the environment we've had for the past 28 years...somewhat mitigated by the Clinton era. Now the Obama administration and Democrats in Congress are doing the bidding of both the corporations (at least troubled big financial and auto) and the rich (at least the affluent). They do this because they believe not helping the too big to fail banks would throw the economy into a depression and because they believe helping the affluent would trickle down to the majority below the 90th percentile, and dilution isn't a problem in deflationary times like the present.

But from my POV I see both Tweedledum and Tweedledee parties abusing the Keynsian notion of deficit spending during recessions and tightening (running surpluses) during prosperous times. Neither party follows through with the latter. We get the junkie's and alcoholic's rationalization every time: just give me something to tide me over for today and tomorrow I'll shape up. Well, tomorrow never comes and the fiscal situation never gets balanced. They kick the can down the road and the debt grows with each administration--a big 'Fuck You' to our children and our foreign creditors. Both parties are simply doling out spoils to their patrons, and I don't count myself among either constituency. I wish them both ill.

While I always assumed that the Democrats (Tweedledee Party) were the lesser evil because at least they cared about real people, today I am wondering if supporting the 90th to 99th percentile might not be a bigger drain on the nation's finances than continuing to support the 99th+ percentile? The affluent may make up for in numbers what the wealthy made up for in dollar amounts per individual. And a top heavy, top 1% party is inherently unstable and might eventually be overthrown, while a party which benefits 9% of the people might last longer and ultimately do more damage. The reason I'm willing to entertain these questions is that since the Tweedledee Party regained control of congress in 2007, and particularly since Obama came to power this year very little substantive change has occurred--certainly much less than I and others were anticipating. I am no longer willing to give the Democrats a pass simply because they are not George W Bush, when in many cases they continue the same policies of same Bush.

So...which party is better for somebody at the 50-80% level? The 25% level? Why?

The party which is pro wealth is worse for everyone, because it threatens the system more.

At this point things like extending unemployment benefits, or supporting head start, or something of that nature which one might expect from a party which supports the lower end of the economic ladder, really just amounts to either window dressing or maintaining the status quo as opposed to some sort of radical new initiative. Things that might represent a radical change really can't get off the ground given the influence of lobbyists. The things you would get from this party would be less Earth changing than what one would get from a pro-wealth party which would want to slash tax rates.

And Earth changing is what I would be interested in on either end of the spectrum. The reason for that is this, right now the global economy is all about confidence and anything that shakes the confidence in the markets and the dollar will threaten the whole system. If you have a cash basis system confidence is not such an issue, but todays system is heavily debt and leverage dependent even after the crisis. There are even many good things which could be done that would threaten confidence at this point. To find a soft landing out of the need for the status quo that this confidence requires may be impossible, but it would be nice to aim for.

I worry about the coming elections, especially 2012, I think that is the next presidential, isn't it, there seems to be a lot of unrest building at the moment, and as I mention earlier I believe that given the state of the global economy now the cure will be worse than the disease. For decades the wealthy have enjoyed the benefits of a major coup, they sold people on the idea that what is good for them is good for everyone. That is wearing rapidly thin.

I am not so sure that it is really a zero sum game either. It is if you want to take the view that high end income streams aren't taxed sufficiently which passes along a debt burden to the lower classes. But we have created a system where vast sums can be funneled into investments without ever moving into consumption, aside from consumption of investment instruments, and since the supply of those seems to be open ended you dont have such a severe supply demand dynamic. So in any rate the accumulation of paper wealth in portfolios doesn't equal a drain of wealth from lower classes.

I was really with you this time...until your final paragraph, that is. Certainly the apologists for the rich have maintained that the accumulation of paper wealth in portfolios doesn't equal a drain of wealth from lower classes.That's been their shtick all along, but I think this inherently leads us away from democracy and towards oligarchy. Money is free speech, according to the Supreme Court in 1976 (Buckley vs. Valero), and we as a society have never been so unequal except perhaps in 1928 and during part of the Gilded Age. We live in a materialistic, consumption and debt-driven age with myriad poseurs, impostors, hucksters, and victims. It is not so much that we have become pro-wealth as we have sought a killing: getting filthy rich quickly by hook or by crook. This is an atavistic throwback to the wild west days of the 19th century, is barbaric, and augurs ill for the vast majority of commoners who will be left behind.

True, the Democrats still support some programs like food stamps, unemployment insurance, foreclosure moratoriums and mortgage re-writes which help ordinary working people, but these are a small proportion of total spending, and the corporate bailouts are vastly larger. What the Federal Reserve--an unelected and mostly unaccountable body-- has done is vastly larger.

Your third and fourth paragraphs seem to me right on.

Questions in above posts are a bit muddled. GOP makes itself clear. I'm generally opposed to them and favor Dem positions. But Dems have a spectrum. Kucinich is at the left. Various Southerners are at the right.

Amurrikan voters are regional more than issue-oriented. At election-time, they often vote for "the man" no matter the issues. In 2012, I expect Petraeus to be nominated and win -- vitiating every issue. The "people" could even turn leftist while a rightist becomes Prez. Many dictatorships are that way.

Rational expectations are passe. Power-blocs and their goals are "in." We know what the GOP wants. Maybe they'll be held back in Congress.

A badder recession portends even worse inconsistencies, where almost nothing will make sense except the irrelevancy of about 60% of the people.

The following (truncated) statement by genedio caught my eye:

"True, the Democrats still support some programs like food stamps, unemployment insurance, foreclosure moratoriums and mortgage re-writes which help ordinary working people... "

These measures are conceived to hold people in position, not to set the conditions for their betterment. They do not go a bit beyond preventing their condition from becoming worse. The Tweedle Twins both support them to some extent because they can't seem to move on to a position of improving the status of these people because it can only reasonably be achieved by taking something away from the top end. I think this is similar to the reality that US wages would be made worse by the mechanisms that make Chinese wages better. That particular tradeoff was accepted by both parties (posturing by the out-of-power party aside) since it didn't take away from the top echelon, but rather improved its lot.

I think that presenting me with the Tweedle Twins as little different and asking me to choose between them is somewhat unfair. I'm not terribly impressed with either one. I suspect that Obama is more liberal than the median Democratic pol, but he is too politically aware to press them to support his positions against their own impulse.

In any case, one has to conclude that the poor are satisfied with their lot: if they weren't, wouldn't they be buying full page ads in the New York Times and Wall Street Journal and commercial minutes at the Super Bowl to present their viewpoint? There! That should be definitive!

I do not know the man well enough to know if he has the ambition to want to be President, but assume for the sake of argument that he is, and even that he is secretly planning a major run for the Presidency in 2012.

I still don't buy that he would be a 'shoo-in', as you seem to believe. By 2012, I believe, the American public is going to be incredibly weary of war, of all the guns-vs-butter trade-offs that war requires, and they will be much more attuned to arguments that the expensive wars we have been fighting during this decade are one of the major causes of our economic misery. Even more so than they already are today. Because it is becoming more clear almost every day that we will still be in Afghanistan in 2012, and we will still even be in Iraq in 2012. I suspect that the prevailing mood of America in 2012 will be one of isolationism. And Petraeus will strike many if not most people as being a 'pro-war' candidate. And they will say: PHOOOEY!

They will be far more likely to turn to a candidate, perhaps a demagogic one, who will promise to get us out of Iraq and Afghanistan RIGHT AWAY, and turn our attention to domestic concerns. Kind of a Pat Buchanan candidate, although certainly not Pat Buchanan himself.

And Obama might find himself in a life-or-death fight against such a candidate.

I was very struck by the following passage from your post:

Genedio: We live in a materialistic, consumption and debt-driven age with myriad poseurs, impostors, hucksters, and victims. It is not so much that we have become pro-wealth as we have sought a killing: getting filthy rich quickly by hook or by crook. This is an atavistic throwback to the wild west days of the 19th century, is barbaric, and augurs ill for the vast majority of commoners who will be left behind.

LeRoy: Thumbs up to that. I agree, wholeheartedly. And I think Ronald Reagan did more to bring this 'age' about than anyone else. That's why he loved and adopted the cowboy image. He was the biggest huckster of them all.

You said it right.

BUT

You can Google Petraeus 2012.

He is very very smart and has many conservative backers. Ike got us out of Korea.

The GOP will do anything to get back in -- except healthcaresurance reform.

I often sense that the voting populace loves wars. But on Afgh it would be easy to cut and run -- or escalate under a rubric that Obama did it wrong. NYT today has an article from Russian archives. where their generals said exactly what our generals say now. I don't see how USA could do anything successful in Afgh; they are a screwed country. USA has to get other countries in there big-time -- or just run out.

The big Petraeus unknown is that he is rumored to be Jewish, perhaps just by paternity. Nowadays, that COULD work for a general; but there will be a lot of heat. He could run with a Jack-Armstrong-type to offset.

If Petraeus is determined to be "Jewish by paternity", I doubt that the international Jewish community (no; I have no idea how to define that - it just sounds meaningful) could come together on whether that makes him Jewish in just 3 years, or even 7.

I may have just returned us to the subject "game theory".

Somewhat to my surprise, you, Phil, addressed the "game" more than did the others, even Leroy. I think you nailed it in the following:

The Tweedle Twins both support them to some extent because they can't seem to move on to a position of improving the status of these people because it can only reasonably be achieved by taking something away from the top end. I think this is similar to the reality that US wages would be made worse by the mechanisms that make Chinese wages better. That particular tradeoff was accepted by both parties (posturing by the out-of-power party aside) since it didn't take away from the top echelon, but rather improved its lot.

OKay. So far so good. Now I'm asking you to imagine that you're not trying to help the top 1% by playing American workers off against their foreign counterparts, but that you're right at the 50th percentile, median wage of $32,000 for an individual and $48,000 for a couple. Do you support the Dums (who support the top 1%) or do you support the Dees (who support the 90th to 99th percentile plus the bottom 20)?

Very interesting question. May I offer two answers, one socially based and one financially based? I'll take your silence as a yes.

On a social basis, I think that any financial support that goes to the bottom 99% is better than increased support going to the top 1%. As a for-instance, I think that any additional wealth placed in the hands of the bottom 20% might lead to a decrease in petty crime and an increase in the propensity to stay in school. These are socially positive changes. Of course, one must ponder what the effect of support for both the first and fourth pentile means, and that probably depends largely on the relative magnitude of support delivered into each of these two groups. The effect on the top 1% is probably socially insignificant while there would be some net inflow to that top ownership group as money is spent with their businesses.

On a financial basis, I feel that I compete with members of the bottom 80% for a common set of products much more than I compete with the top 1% for either these products or the luxury products which are basically only sold to that top 1%. Under those circumstances, I would expect that support for groups in the bottom 80% not including my own will raise the prices of those products which I compete for. On that basis, I might be better off with the Dums.

My ultimate choice would lie in the balance of influence between my selfless side and my selfish side. Thinking back to the few games theory books I have read, I found that in each case, a body of thought that was initially presented as being sharp edged and analytical turned out to be much mushier and soft edged than I had been assured would be the case.

In the aftermath of the events of 9/11/2001, undoubtedly true. Americans of almost all political stripes wanted to go stomp on someone, enemies real or imagined. Heck, some Americans would have been ready to go stomp on France, a country that has been an ally for almost two-and-a-half centuries, simply because the French didn't seem to be quite gung-ho enough to suit the red-meat contingent in American politics.

But today? Not so much. In fact, recent polls show that a clear majority of Americans want us to withdraw from both Iraq and Afghanistan. As I said, this country is war-weary. We have been fighting wars now for more than eight years, twice as long as we fought in World War II, and we seem to have achieved very little. [Other than the death of Saddam, and I have no issue with calling that an achievement.]

This is a case where I think we ought to go by the principle 'majority rules'. This is a case where I think President Obama ought to listen to the clearly expressed wishes of the American public, and over-rule the recommendations of his still eager-for-war generals.

Phil: On a social basis, I think that any financial support that goes to the bottom 99% is better than increased support going to the top 1%.

I agree, but my original scenario failed to mention that financial support continues to pour in to the top 1% as before; that in fact the amount of money going to W$ has never been greater. We are getting a government which BOTH supports the top 1% AND now aids the 90-99%, plus throws an occasional bone to the bottom 20%. So relatively, all the 20-80th percentiles are getting is a somewhat socially beneficial support to their neighbors in the bottom 20 and 90-99 greatly mitigated by the fact of the continuing recession, or at least job-loss recovery. I'm cynical enough to believe the financial concerns outweigh the social, and meanwhile in a world with rapidly dwindling natural resources, the former is becoming mostly a zero-sum game. Your win is my loss. So being a member of the 20-80 gang, I'm greatly concerned about the added debt, the chance my money will be worth less in the future, and even the social unfairness of it all.