Thursday, February 28, 2013

Robert Reich is Right, the GOP is Wrong

Not only were the Republicans directly responsible for crashing the economy that ruined millions of American's lives, but for the past four years they have actively attempted to make things much worse --- but not just to make Obama and the Democrats look bad in an attempt to regain political power (although that's one reason), but also to fulfill their ultimate 30-year plan of "Starving the Beast". We are the "beasts" they want to "starve" --- and since the days of Ronald Reagan, they've been succeeding.

In his latest opinion piece for the Huffington Post, Why Obama Must Meet the Republican Lies Directly, Robert Reich conveys what most people already believe, that the Republicans' talking points (regarding their austerity and trickle-down economic plans) are both dangerous and bald-faced lies.

That's why the majority of Americans, instead of voting for Mitt Romney last November, voted for Obama. But the majority has been held hostage to the will of the "minority of the minority" -- a handful of fanatical anti-government ideological anarchists --- those in the Tea Party, who couldn't win an election fairly on the issues, so instead, now hold gerrymandered seats in the House of Representatives.

Despite a majority of the people's will, 49 individuals have stubbornly refused to cede power to those who had legally and fairly won the 2012 elections...President Obama and the democratically elected Democrats.

And then the Tea Party anarchists had the gall to accuse President Obama of being a dictator and a Socialist. Who's been dictating to who?

Robert Reich: "The first big lie is austerity economics -- the claim that the budget deficit is the nation's biggest economic problem and is responsible for the anemic recovery.
  • Wrong. The problem is too few jobs, lousy wages, and slow growth. Cutting the budget deficit anytime soon makes the problem worse because it reduces overall demand. As a result, the economy will slow or fall into recession -- which enlarges the deficit in proportion. You want proof? Look at what austerity economics has done to Europe.

The second big lie is trickle-down economics -- the claim that we get more jobs and growth if corporations and the rich have more money because they're the job creators, and job growth would be hurt if their taxes were hiked.

  • Wrong. The real job creators are the broad middle class and everyone who aspires to join it. Their purchases keep economy going."

These two lies -- austerity economics and trickle-down economics -- are being told over and over by Republicans and their mouthpieces on Fox News, yell radio, and the editorial pages of the Wall Street Journal. They are wrong and there are dangerous.

Just as Robert Reich had explained, it's people's purchases that keeps the economy going (the basis for any capitalist economy, as in "supply-and-demand"). Just as the multi-millionaire and investor Nick Hanauer once explained in a speech he gave at TED University:

"Somebody like me makes hundreds or thousands as times much as the median American, but I don't buy hundreds or thousands of times as much stuff. My family owns three cars, not 3,000. I buy a few pairs of pants and shirts a year like most American men. Occasionally we go out to eat with friends."

Wealth disparity is higher now than it's been since the first Gilded Age, and as inequality continues to widen, and income and wealth become ever more concentrated at the top, the rest of us don't have the purchasing power we need to boost the economy. That's why American multi-national corporations are forever seeking "emerging markets" in which to sell their goods and services. And that's the main reason why (since the beginning of the financial collapse and the Great Recession began) the U.S. economic recovery continues to be so anemic for working, under-employed and unemployed Americans.

Just as Mitt Romney had said last year about the current economy, "The rich are doing just fine". Yes they are, it's just everybody else who isn't and has had to make all the "shared sacrifices" --- as in lost jobs, home foreclosures, evictions, reduced home values, poor credit scores, lost savings, lost retirement accounts, etc. (The top 1% has actually profited from our decline.)

Older Americans (such as The Boomers) were especially hard hit. According to a report that was cited by the New York Times, an unemployed worker between the ages of 50 and 61, who had been laid off and remained unemployed for 17 months or longer, only has about a 9 percent chance of ever finding a new job again. That is a very grim statistic.

Many of the older unemployed workers, if they were 62, were forced into taking a reduced early Social Security retirement because they couldn't find jobs, while millions of others were forced to take two and three low-paying jobs just to make ends meet. Many are unaccounted for, or they committed suicide, just to end up as a another government statistic.

And then there are those who can only survive with the help of unemployment benefits, food stamps and Medicaid. These beat-down Americans have been living in fear for the past four years under the constant threats of budget cuts by the Republicans.

But the Tea Party continually insists on blaming the aftermath of our wrecked economy on Obama, who is only trying to pick up the pieces of the failed economic policies from a prior Republican administration.

We know the GOP lies --- we know the truth

  • Eight years of tax breaks for the ultra-rich and two un-funded wars under George W. Bush is what first created the deficit that Obama inherited. We know why since it's jobs!!!
  • The 56,000 factories that closed and the outsourced jobs during the Bush years escalated the middle-class decline.
  • The stock market crash in 2008 and the housing bubble burst made things that much worse. All these things happened BEFORE Obama was elected. But whenever jobs are created, the GOP always claims that it's in spite of Obama's policies, although the Republicans have never presented any viable jobs bills themselves. Just the opposite, they cut thousands of government jobs.
  • An unfair tax code with low tax rates on capital gains and the $113,700 income cap on Social Security taxes also helps drive, and further widens, the income inequality between rich and poor.
  • Off shore tax havens, unfair tax loopholes and ridiculous tax deductions for the ultra-rich, all contribute to the under-funding of the necessary tax revenues we need to run our government.
  • Yes, we do have "bigger government", but because our population has grown from 200 million people 40 years ago to over 300 million today, it only stands to reason that our government would also be bigger.
  • Massive income tax evasion, because of the GOP's budget cuts to the IRS, also resulted in less tax collections and tax audits (and less prosecutions for tax cheaters). The GOP claims that "if we tax them less, they will cheat less." (???)
  • Over $2 trillion in unrepatriated corporate earnings is stashed abroad as untaxed profits --- this idle cash that's being hoarded overseas needs to be circulated throughout the economy to stimulate growth.
  • The huge CEO salaries instead of fairer wages to their employees ("people who purchase things") also contributes to wealth disparity.
  • Taxpayer bailouts to banks that are still making record profits and executive bonuses -- and the GOP's repeated efforts against reforming the financial industry --- that too is unsustainable and will result in another financial bubble (JPMorgan's CEO Jamie Dimon recently admitted as much.)
  • Tax subsidies to very large and profitable corporations (like those in the oil, tobacco, dairy, and natural gas industries) is about as insane as any other Republican economic policy.
  • Congressional pork, such as defense contracts for programs that the generals didn't ask for and says they don't need, is a HUGE part of defense spending, not just soldiers in the field. "Bridges to Nowhere" are another example of waste, fraud, and abuse in government spending.
  • We do not have enough government resources to investigate healthcare, insurance, and Medicare fraud, which drives up the costs for everyone (members of Congress and their families don't face this concern).
  • H-B1 VISAS and the outsourcing of domestic jobs for cheaper labor overseas, putting millions of Americans out of work or, for those who once had good-paying jobs, were forced to work in much lower-paying jobs at places like Walmart, Staples, Dominos, and McDonalds.
  • Busting labor unions to drive down wages and benefits for American workers, and big businesses spending millions to lobby against worker's rights and their protections (e.g. "Right to Work" laws, etc.) has decimated the middle-class for the past 40 years. Public sector union employees aren't earning "too much", they're earning what everyone else is supposed to be earning in the private sector (the GOP uses them to divide the workers).
  • And stop telling us the "medium income" is $50,000 a year when we all know that $50,000 is the "median household income", because it now takes two wage earners in one household to pay the rent. (We're poor, we ain't stupid!)
  • Campaign finance and elections laws, rigging our democracy against the majority of the people --- (and ideologues in the Supreme Court) is the main reason why we cannot rectify all of the aforementioned above.

The Tea Party --- and the "once-moderate" Republicans who have been co-opted by the anti-government anarchists, and who are mostly concerned about their own jobs (e.g. John Boehner and Mitch McConnell, etc.) --- keep repeating the same old lies --- over and over and over and over again --- thinking we'll eventually believe them.

"If you tell a lie big enough, and keep repeating it, people will eventually come to believe it." ~ Joseph Goebbels

But whenever the Democrats had a chance to rectify many of these wrongs, they also dropped the ball. And many Democrats, being millionaires themselves, also benefited from the current tax code --- the tax code that they helped write --- but then, they have the nerve to go on TV to complain about their own tax loopholes! Un-believable! And that's why the Buffett Rule will never pass.

And now the Democrats are also talking about chained CPI as a "good" way to save money in the government budget. Yeah, right, by screwing the elderly in their monthly Social Security checks. That would only be something that I'd once expect from the Republicans, now we can't trust either political party.

Robert Reich is right, the GOP is wrong --- but the "mainstream" Democrats haven't been much better either. We need many more "Progressive" Democrats in Congress, otherwise, nothing will ever change.

"Meet the new boss, same as the old boss...we don't get fooled again." ~ The Who

Wealth, Wages and Taxes Compared

The combined net worth of the 400 richest Americans last year was $1.7 trillion, up from $1.5 trillion the year before. The average net worth of a Forbes 400 member was a staggering $4.2 billion (the highest ever) in 2012. The Walton family alone is worth over $100 billion. 30 years ago there were only 13 American billionaires. Now we have 424. Like reverse osmosis, the money is being sucked to the top, so there is much less economic activity in the bottom 99%. (Remember, it's people's purchases that drives the economy.)

During the Great Recession in 2009, when the unemployment rate had peaked at 10.2% (when over 15 million Americans were unemployed), only 140.5 million tax returns were filed for that year --- down from 142.5 million the year before in 2008. I personally did not have to file a tax return for 2011, the first time in 35 years. This year, the same thing. I had ZERO income last year too (and most probably ZERO income for this year as well.)

According to the IRS, for that same year in 2009, the top 1 percent of taxpayers had an average Adjusted Gross Income of $960,000 with an average federal income tax rate of 24%. The billionaires on the Forbes Fortune 400 List earn most of their income with "investment income" (capital gains) and paid no Social Security or Medicare taxes on this income.

Individuals with regular incomes over $372,950 (earned as "wages") were subjected to the highest marginal tax rate of 35%, but they also had their Social Security taxes capped on their first $112,000 of earnings. These individuals would usually be CEOs with base salaries AND stock options worth millions of dollars (by contrast, a neurosurgeon, the most educated and highest skilled person in the health care industry, might have an adjusted gross income of $225,390 a year.)

Meanwhile, during that same year, the bottom 50 percent of taxpayers (or Romney's 47%) had an average Adjusted Gross Income of only $15,000 --- and an average federal income tax rate of only 1.9% --- but they also paid Social Security and Medicare taxes on 100% of their earnings. According to the Social Security Administration, 50% of all workers in the U.S. workforce netted $26,966 or less that year and that would account for why 47.6 million Americans now need food stamps for their survival (I am one).

And with the exception of the unemployed, will someone please explain to the Republicans that food stamps are not "entitlements" but are really" wage subsidies", and companies like Walmart benefit the most.

In 1973, as a high school drop-out, I belonged to the Carpenters and Joiners of America and was earning $7.50 an hour as an unskilled welder's helper in a shop making metal doors. Today that would be $36.50 an hour. But according to the Bureau of Labor Statistics, almost 40 years later, as of 2010 skilled welders are only getting a median pay of $17.04 per hour. In 2008 my last wage as a casino bartender in Las Vegas was $16 a hour --- and every dollar I made in tips was taxed (a tip isn't a "gift", it's a "wage"), but people like Kim Kardashian and Paris Hilton can inherit $10 million tax free. WTF!!!!

Meanwhile, paper investments by the top 1% in the stock market have seen their notional values skyrocket since 1973. Just since March 2009, the value of stocks on the Dow Jones has doubled. Most of the earnings have went to the top, while wages remained stagnant as prices (the cost of living) have gone up for most working Americans.

Job Numbers by Presidential Administrations

Since Obama was first elected in 2008 the Republicans' #1 priority was making sure that Obama was a one term president. They failed miserably.

Since 2010 the Tea Party has focused primarily on two things: Repealing ObamaCare® and writing anti-abortion bills. They also failed...many times over. And the only jobs they ever created were their own.

Now it seems that the Republicans' #1 priority is to make sure the already-down-and-out (poor and unemployed) is even more miserable --- and letting the most wealthy among us have whatever it is they want...less regulation, less taxes, less liability...

And just in case you didn't know, Bill Clinton had the best jobs record, George W. Bush had the worst, and his dad didn't do much better. And so far, more jobs were created under Obama (with no thanks to the GOP) than under either Bush --- and in half the time. >>> Source: Wall Street Journal

So Robert Reich was right, and has always been right --- while the GOP is wrong, and has been very wrong for a very long time.

President    Jobs created    Jobs at end of term    Jobs at start of term    Payroll expansion    Jobs created per year in office    Population growth    Percent change in population   
George W. Bush 3.0 million 135.5 million 132.5 million 2.3% (Worst) 375,000 22.0 million 7.7%
Bill Clinton 23.1 million 132.5 million 109.4 million 21.1% (Best) 2,900,000 25.2 million 8.9%
George H.W. Bush 2.5 million 109.4 million 106.9 million 2.3% 625,000 12.5 million 4.8%
Ronald Reagan 16.0 million 106.9 million 90.9 million 17.6% 2,000,000 17.3 million 7%
Jimmy Carter 10.5 million 90.9 million 80.4 million 13.1% 2,600,000 9.8 million 4.3%
Gerald Ford 1.8 million 80.4 million 78.6 million 2.3% 745,000 5.1 million 2.3%
Richard Nixon 9.4 million 78.6 million 69.2 million 13.6% 1,700,000 12.3 million 5.7%
Lyndon Johnson 11.9 million 69.2 million 57.3 million 20.8% 2,300,000 11.3 million 5.6%
John F. Kennedy 3.6 million 57.3 million 53.7 million 6.7% 1,200,000 8.2 million 4.3%
Dwight Eisenhower 3.5 million 53.7 million 50.2 million 7% 438,000 23.3 million 12.8%
Harry Truman 8.4 million 50.2 million 41.8 million 20.1% 1,100,000 N/A N/A

* Also posted at the Daily Kos

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