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'Hated' new book intensifies economic inequality debate

Published: Thursday, July 26 2012 2:54 p.m. MDT

A book some are calling "the most hated book in America" was recently released by Edward Conard and defends the 1 percent of wealthy Americans while presenting a trickle-down view of the economy.

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The controversy over income inequality and effectively aiding the poor continues to ignite debate this summer, and more fuel was added to the fire with the release of a new book some are already calling "the most hated book in America."

"The simmering debate over income inequality got a jolt of energy recently with the publication of Edward Conard's book 'Unintended Consequences: Why Everything You've Been Told About the Economy Is Wrong.' Conard is a former partner of Mitt Romney's at Bain Capital, so his book can be interpreted (rightly or wrongly) as the Bain View of the Universe," according to U.S. News & World Report.

"As its subtitle suggests, Conard’s book is an attack on much of the received wisdom about the crash of 2008," writes Ross Douthat in a New York Times editorial. "He argues that America’s pre-crisis economic gains were real rather than illusory. He defends the growth of the financial sector and the bubble-era behavior of the major banks. And he argues that the crisis itself was less a comprehensive meltdown than a simple panic that tells us very little about the underlying soundness of the economic order."

Some experts say it may be time to look at the problem through a new paradigm and consider that it may be best for the government not to intervene.

"The trick is figuring out what ordinary people can do to make themselves better off," according to the U.S. News & World Report article. "To do that, it helps to understand the real problem, which isn't income inequality in itself. It's a decline in economic mobility, which means it's getting harder for people to boost their earnings, move up the socioeconomic ladder and improve their living standards."

Conard has his own approach and suggests that the increasing gap between the rich and poor represents the need for an incentive to take financial chances.

"Indeed, against the current anti-bailout mood, Conard suggests that we actually need stronger government guarantees for too-big-to-fail institutions, to encourage the kind of risk-taking that reaps long-term rewards," Douthat writes. "In a similar spirit, he defends the extraordinary wealth accrued by America’s richest 1 percent, arguing that such huge rewards are necessary to induce talented people to become entrepreneurs and investors rather than just white-collar time-servers."

The role of the government in fixing the financial crisis is almost as hotly debated as the crisis itself.

"What politicians and policymakers really ought to be telling struggling Americans is this: You're on your own," according to U.S. News & World Report. "The government is running out of money and is borderline dysfunctional besides. Instead of new policies that will make the economy more fair, we need more self-sufficient workers who aren't looking to government for answers."

"The logic of Conard's approach, which he does not elaborate, would be that those responsible, hardworking, investment-rich folks should, in a rational world, be rewarded and incentivized," writes Robert Teitelman in The Deal Economy blog post. "This, indeed, is increasingly the world of Citizens United and a political system heavily tilted to those with money. This too reminds one of the Gilded Age and the dog-eat-dog world of the Social Darwinian jungle. He would do his own cause more good by getting out of the jungle and into the light of day."

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