Misrepresenting the Economic Views of Liberals

Mark Thoma shared with me in an email some very odd rant from Jan Larson:

The third in a potentially never-ending “liberals are” generalization series focuses on how liberals are economically ignorant … Liberals don’t understand economics, but that doesn’t stop them from following a “liberal economic theory.” This theory is fallacious in its assumptions that the “rich” (who, according to liberals, are evil) only got that way at the expense of the poor, that government can actually pay for things and that businesses are no different than rich people, that is they are evil and must be punished. Liberals abhor the concept of profit, especially “excessive” profit. Just what is excessive profit? Any profit that is more than a liberal thinks it should be. Surprisingly, I’ve never heard of a case where a liberal sold his or her house for less than market value or took less than the maximum profit. Liberals get the vapors just thinking about “tax cuts for the rich.” Liberal economics dictates that you take money from the rich and give it to the poor. Most wealthy people didn’t get rich by accident nor did many poor people get there by accident either. People largely achieve their economic status by the decisions they make. Wealthy people start companies and create jobs. Poor people don’t. Who would you rather work for, a poor person or a rich one? The recent run up in gasoline prices has gotten liberals in a lather about oil company profits. Too much profit! Those fat, greedy, cigar-smoking oil company executives must be laughing it up as they just keep raising prices higher and higher.

Like Mark, I would not have much to say about this rant given that I don’t consider rich people to be evil and I certainly don’t abhor the concept of profits. But Mark bailed us both out with his link to an oped from George McGovern:

I HAVE NEVER wavered in my support for policies that relieve poverty and improve the standard of living of American workers. As a lifelong liberal, I supported Medicare and Medicaid, civil rights, Social Security and workplace safety requirements. Today, I strongly support universal healthcare … The current frenzy over Wal-Mart is instructive. Its size is unprecedented. Yet for all its billions in profit, it still amounts to less than four cents on the dollar. Raise the cost of employing people, and the company will eliminate jobs. Its business model only works on low prices, which require low labor costs. Whether that is fair or not is a debate for another time. It is instructive, however, that consumers continue to enjoy these low prices and that thousands of applicants continue to apply for those jobs.

I’m sure that some of my fellow economist bloggers might find some reasons to be concerned about the economics inherent in how Wal-Mart runs its business. For now, I’ll just point out that perhaps the most liberal Democrat to win our nomination for the Presidency (at least in my lifetime) does not abhor profits. Incidentally, Mr. Larson holds an MBA – not a Ph.D. in economics.