We do not have budget problems in this state and country because we spend too much on poor people.
We do not have budget problems because we spend too much for teachers.
We do not have budget problems because we spend too much on the middle class.
We do not have budget problems because we pay public employees too much.
Getting It Right
We have budget problems because there is the widespread belief converted into public policies that government exists chiefly as an instrument of capitalism.
We have budget problems because too many politicians think that government should eliminate any obligation for companies to contribute to the public good.
We have budget problems because too many politicians, including those on the U.S. Supreme Court think that putting their thumbs on the scale to tip it in favor of a system flooded with corporate political money.
We have budget problems because the middle class is deluded into believing that tax cuts trickle down to them instead of flowing up to the concentrated wealth of the top 1% of Americans.
The U.S. as Banana Republic
It’s an incredible fact of life in American politics today. So many people, particularly white men, believe that federal tax policies benefit them and that the continuation of the Bush tax cuts is good for them.
A few months ago, the Associated Press penned an article based on the fact that “the income gap between the richest and poorest Americans grew last year to its widest amount on record,” and the news service could not manage in about 1,000 words to consider whether federal tax policies aren’tt a large driver of that disparity.
It’s a sign of the times. At the precise moment that we need journalists to get behind the numbers and dig out the facts, the news media are entranced by celebrity journalism and talking heads. It’s no wonder that 90% of Americans, regardless of their age, race, income, gender, or political persuasion, think the top 20% controlled 60% of American wealth when in fact, the top 20% control 85%.
It’s the kind of disparity that is more customary in banana republics and third world countries. In an analysis of wealth inequality around the world, the U.S. falls between Uruguay and Cote d’Ivoire. The countries with the greatest wealth equality are Sweden, Denmark, and Slovenia. The next 20 countries are all in either Western Europe or former Eastern Europe Communist bloc countries.
The Rich Get Richer
No industrial nation in the world approaches the level of wealth inequality found in American today. As for Tennessee, it’s even slightly higher than the U.S. We’re the Rwanda of U.S. states.
Perhaps, at a time when American is accused of being a colonial power, the truth is that we are a corporate colony. Between 1978 and 2008, almost 35% of America’s total income growth went to the top 1/10th of 1%, and between 2002 and 2007, two-thirds of wealth went to the wealthiest 1%, the highest rate since the years before the Great Depression.
Something clearly is not working. Since 1980, the richest Americans’ incomes have quadrupled while the lowest 90% of Americans saw their incomes fall. The average wage today is lower than it was in the 1970s while productivity has risen 50%.
The Bush tax cuts were extended at a time when the CEOs of the largest American companies earned more than 550 times more than their average workers. In 1980, CEOs earned an average of 42 times the average worker. The median compensation for CEOs in all industries is about $4 million, and for the companies listed on the Dow-Jones Industrial Average, the average salary is $19.8 million. From 2006-8, the top five executives at the 20 banks that accepted federal bailout dollars averaged $32 million each (100 average workers would have to work more than 1,000 years to make as much).
Enough is Enough
The supply siders argue that raising taxes on the wealthiest Americans will slow economic growth, but history proves them wrong. Between 1951 – 1980, America’s top marginal tax rate was 70 to 92% and the average national annual growth was just under 4%. The rate was far lower in 1983 and the years following it, but the economy grew at a rate of 3%, and despite right wing rhetoric to the contrary, the boom in the economy under Ronald Reagan took place after his tax increase. Interestingly, the 1990s boom followed Bill Clinton’s tax increase in 1993. During the Clinton years, the economy created 22 million net new jobs and unemployment dropped to 4%.
Here’s our point: The past few decades have been exceedingly good for a few, and it’s time for the rest of us to take to the streets to reject as loudly as possible any suggestion that our budget problems are caused by public unions, high-paid teachers, and greedy public employees. We live in strange times, and chief among them is the propaganda that it’s the middle class that’s the source of our problems and the places to cut costs are safety net programs.
Somehow, we have to cut through the clutter and get to the clear connection between wealth and power. Somehow, we have to eliminate the notion that the purpose of government is to make the “right” people wealthier. All of us studied the robber barons in American history, but in that era of accumulated family wealth, the richest 1% controlled 18% of the nation’s income. Today, the top 1% controls about 25%.
There has to be a point when we come to grips with the fact that income inequality is a homeland security threat to the democratic principles on which our country was built. The trends of the past 30 years are simply unsustainable as the middle class drowns and the costs of increased income inequality are measured in much more than financial terms. Rather, the costs will be measured in a breakdown of social cohesion, frayed national focus, a collection of special interests, and the kind of frustration already emerging in states like Wisconsin.
Robin Hood was right.
Spot-on, sir, this is awesome.
That right there is the painful truth of things in this country, especially when you have corporate money being used to write U.S. policy while, at the same time, the middle class is continuously being chipped away not just at the federal level, but at the state level as well, all for the sake of corporate greed.
Some of us remember a time, not so long ago, when SCM used to rail against federal deficit spending.
And one can only wonder at what SCM would have said if George Bush had bombed Libya. One will have to wonder, because SCM hasn’t said a peep about it.
My, what a difference two years can make.
Anon-
Please read the following blog and the follow up discussion:
http://www.smartcitymemphis.com/2011/03/cities-should-question-u-s-defense-entitlement-spending/
Anonymous:
We guess you didn’t get the point. If the wealth of the nation wasn’t being concentrated with the wealthiest among us, we could return to the budget surpluses – which as you must know were part of the Clinton’s legacy. In the midst of a global economic collapse, we thought the deficit was secondary to addressing the crisis (a position we took when Bush, not just Obama, was in office). Life and public policies are more nuanced than many ideologues try to make them.
>>>If the wealth of the nation wasn’t being concentrated with the wealthiest among us, we could return to the budget surpluses
Anon 7:16 here. Urbanut, yes I realize that defunding the Defense Department has been the Democrats’ hobby horse since, oh, 1965 or so. SCM, if you taxed the rich back to 1970’s tax levels, you’d hardly make a dent in this deficit. It would only make you feel good. We must correct the growth of Social Security, Medicare, defense, and the health monstrosity to address the deficit.
>>>which as you must know were part of the Clinton’s legacy.
Boy, that’s rich. Newt Gingrich and the Republicans addressed the deficit, and Clinton (having lost the Congress two years into his term — sound familiar?) had no choice but to go along. Clinton wanted to raise taxes the first two years.
Eisenhower’s was right when he said that we should be wary of a military-industrial complex which drives foreign policy and never sees a war it doesn’t like. It is obscene what we are spending for defense because it is not justified by any rational analysis of our national or foreign policy interests.
It’s not about taxing the rich as the only answer to the deficit. But it’s a start. It’s about a more progressive tax structure in which the middle class becomes the beneficiaries, not the superrich.
If you think that Gingrich produced the budget surpluses in the Clinton days, you need to buy another history book. To our point, it was after Reagan increased taxes that we saw the greatest economic growth.
>>>If you think that Gingrich produced the budget surpluses in the Clinton days, you need to buy another history book.
Anon here again. SCM, the problem with spouting BS is that it is so easily rebuffed with facts.
Cato, 1998: http://www.cato.org/pub_display.php?pub_id=5656
Don’t like Cato? How about Yahoo answers: http://answers.yahoo.com/question/index?qid=20071214065623AA5VuIT
Or Factcheck: http://www.factcheck.org/askfactcheck/during_the_clinton_administration_was_the_federal.html
Or, most of all, how about the Contract with America: http://www.freerepublic.com/focus/news/2126569/posts (Note No. 1).
Ideologue, indeed.
Anybody that quotes Cato and the Contract with America is living with his head in the sand, relying on political talking points instead of the facts.
Smart City: I think he’s being funny. No one is that stupid.
Anon 7:16 here. Facts are stubborn things. Balancing the budget was the very foundation of the Contract with America; quote where the Democratic Party sought a balanced budget before 1994.
Don’t like Cato? Here’s a PBS Newshour transcript from June 1999, see esp. Michael Beschloss:
http://www.pbs.org/newshour/bb/budget/jan-june99/budget_3-9.html
“And so what you’ve seen is that the Republican view of the last 60 years finally triumphed in the 1980’s and 1990’s, and you now see both Democrats and Republicans, the Republicans and Bill Clinton all saying, ‘We all agree that a balanced budget should be paramount. We only disagree on how to spend the surplus.'”
Dick Morris’ Clinton-insider version of what drove the balanced budget: http://books.google.com/books?id=72dnrmaLF0gC&pg=PA132&lpg=PA132&dq=dick+morris+on+surplus+under+bill+clinton&source=bl&ots=P4I9q7Svml&sig=kjC7hYywmei44N5MFAb6K5szyzI&hl=en&ei=kUGNTbjkOoLagAeq_bjJCg&sa=X&oi=book_result&ct=result&resnum=1&ved=0CBUQ6AEwAA#v=onepage&q&f=false
The most sophisticated political “nuance” on this blog is: Democrat good, Republican bad.
Facts are stubborn things and you shouldn’t try to cherry pick them. The Contract with America did nothing to reduce federal spending, it did nothing to eliminate a division of government, it was simply politics as usual as practiced by Gingrich.
OMG, you’re even quoted Dick Morris. You need to quit watching Fox.
Strange you haven’t reacted to the posts that we’ve written that did in fact criticize Democrats, but right now, we think that what the far right wing of the Republican Party is doing is anti-American.
While you’re googling for support for your preconceived opinions, would you send us the SCM post that started your entire commentary – the ones in which we railed about the budget deficits under Bush.
I sorta like not being the only anonymous, all of a sudden
Anonymous is wasting our time. He’s also doing what happens with so many of these right wingers. Since he can’t dispute the original post, he’s taken all of us into the weeds. the post wasn’t on deficits. It was on the inequality of income in the US and how tax policies have produced this. No dispute about that.
Jack, I agree.
Does the (D) or an (R) associated with an arsonists name really matter once the house is already in flames? The question now is whether we are complacent enough to allow such issues to continue being ignored in the capital.
A continued retraction of the middle class does not bode well for the nation’s health socially or economically. A key aspect of our system that prevented widespread political and organized rebellion at the beginning of the 20th century was that the opportunity to gain access to the middle class via upward mobility was available to anyone willing to work hard enough. A shrinking middle class dims this hope and the result is a growing lower tier that will be less complacent to simply work hard in an effort to climb a ladder that leads nowhere.
Goodness, my post answering SCM (that’s answering, Jack) seems to have disappeared. And not a dirty word in it.
Enjoy the echo chamber.
Sorry, don’t know what you’re talking about. But perhaps Dick Morris does.
Great points, Urbanut.
>>>Sorry, don’t know what you’re talking about.
Well, you’ll erase this too, but you and I, and anyone who reads this before you get to it, will always know that you’re a liar, too.
Do you consciously go through your day spewing misinformation and negativity or is it just your hobby? If you don’t like anything or anybody on this blog, we’re willing for you to leave. At any time.