Economic Woes
Class warfare has been declared in America, though the usual suspect is not the one we have come to expect - the Democrats. Democrats have used class conflict effectively to influence the working and middle classes to vote for democratic candidates in the past. That strategy began to backfire during the Reagan eighties as more and more Americans entered the middle class. During the same economic expansion, government programs grew and debt and deficits ballooned.
The government began to run surpluses in the late nineteen-nineties and some economists predicted that the modern economy had vanquished recessions for ever. This myopic notion was used to justify George W. Bush’s refusal to raise revenue to pay for the wars in Iraq and Afghanistan. Disregarding the financial strain from two wars and his tax cuts, Bush increased spending even further with his Medicare prescription drug plan. Just as his term of president ended, Republicans began prophesying the downfall of America if the federal government was not purged of its profligate spending addiction.
For the republicans and their Tea Party allies, the solution to the debt and deficit crisis is to “defund” discretionary spending programs. Of course, their goal is to destroy not only economic programs they hate, but also the social ones that offend their hypocritical sense of morals. These cost too little to have any effect on reducing deficits and debts, but that does not keep Republicans from being obsessed with cutting money for Planned Parenthood and funding for Public Broadcasting.
Of all the Republicans, Rep. Paul Ryan (R-Wis) has been praised most lavishly by conservative pundits (David Brooks, NY Times, April 7,2011) for offering a bold and courageous approach to deficit and debt reduction. It is impossible to believe Ryan’s sincerity when he puts forth a plan that decimates social programs for the poor and middle class while at the same time cuts taxes for the wealthiest Americans. Thus, the political party, who serves at the behest of the wealthy, has interpreted the results of last year’s mid-term elections as the vindication of their political and economic philosophies and have decided they no longer have to hide from middle class Americans the true allegiance to the wealthy and their contempt for the rest of Americans.
If one needs confirmation for the Republicans’ contempt for all but the wealthy, then consult a few important facts. Republican House Budget Committee Chairman Paul Ryan proposed a ten year budget plan that would cut taxes for the wealthiest down to twenty-five percent while cutting from Medicaid hundreds of billions of dollars and by turning Medicare into a voucher system in which Americans can purchase private insurance that in effect will not be enough to cover their medical costs. This plan also cuts money for veterans benefits, education, and transportation, all programs that help the poor and middle class.
The argument that cutting taxes for the wealthiest will stimulate the economy in such a way that prosperity will trickle down to the ninety-nine percent of Americans who occupy the middle and lower classes does not stand up to scrutiny. Over the past decade when taxes were lowered by George W. Bush, the middle class watch its wages and income stagnate. In fact, the top one percent continues to see their wealth and income grow at rates far faster as middle class purchasing power diminishes. A quarter of a century ago, the top one percent of Americans took in about twelve percent of the nation’s income and control about thirty-three of its wealth. Today that one percent captures close to twenty-percent of the country’s income and possesses forty percent of the country’s wealth. According to Joseph Stiglitz, over the past ten years the top one percent of Americans have enjoyed an eighteen percent increase in income while the middle class incomes have declined.
In his essay in Vanity Fair, (May 2011) Stiglitz identifies a few facts that should make Tea Party members reconsider the logic of some of their positions. Almost all U.S. senators and the majority of house members have incomes that are in that top one percent. Moreover, when they leave congress, many of these elected officials will be rewarded with lucrative jobs by corporations whose agendas they have promoted. Congress has steadily become an institution of the wealthy for the wealthy.
A feasible way to pay down the debt and deficit would be to cut spending and increase revenues. Congress has read the report of the Bowles-Simpson Commission, which has devised a formula of spending cuts and tax increases that could reduce deficits by an estimated four trillion by 2020 and “stabilize the debt by 2014.” But rather than implement a sensible combination of cuts and taxes, which would spread more fairly among us all the burden of our economic woes, the Republicans would prefer to shield the wealthiest Americans from even the slightest inconvenience, since by serving them they can, in turn, serve themselves.
Class warfare has been declared in America, though the usual suspect is not the one we have come to expect - the Democrats. Democrats have used class conflict effectively to influence the working and middle classes to vote for democratic candidates in the past. That strategy began to backfire during the Reagan eighties as more and more Americans entered the middle class. During the same economic expansion, government programs grew and debt and deficits ballooned.
The government began to run surpluses in the late nineteen-nineties and some economists predicted that the modern economy had vanquished recessions for ever. This myopic notion was used to justify George W. Bush’s refusal to raise revenue to pay for the wars in Iraq and Afghanistan. Disregarding the financial strain from two wars and his tax cuts, Bush increased spending even further with his Medicare prescription drug plan. Just as his term of president ended, Republicans began prophesying the downfall of America if the federal government was not purged of its profligate spending addiction.
For the republicans and their Tea Party allies, the solution to the debt and deficit crisis is to “defund” discretionary spending programs. Of course, their goal is to destroy not only economic programs they hate, but also the social ones that offend their hypocritical sense of morals. These cost too little to have any effect on reducing deficits and debts, but that does not keep Republicans from being obsessed with cutting money for Planned Parenthood and funding for Public Broadcasting.
Of all the Republicans, Rep. Paul Ryan (R-Wis) has been praised most lavishly by conservative pundits (David Brooks, NY Times, April 7,2011) for offering a bold and courageous approach to deficit and debt reduction. It is impossible to believe Ryan’s sincerity when he puts forth a plan that decimates social programs for the poor and middle class while at the same time cuts taxes for the wealthiest Americans. Thus, the political party, who serves at the behest of the wealthy, has interpreted the results of last year’s mid-term elections as the vindication of their political and economic philosophies and have decided they no longer have to hide from middle class Americans the true allegiance to the wealthy and their contempt for the rest of Americans.
If one needs confirmation for the Republicans’ contempt for all but the wealthy, then consult a few important facts. Republican House Budget Committee Chairman Paul Ryan proposed a ten year budget plan that would cut taxes for the wealthiest down to twenty-five percent while cutting from Medicaid hundreds of billions of dollars and by turning Medicare into a voucher system in which Americans can purchase private insurance that in effect will not be enough to cover their medical costs. This plan also cuts money for veterans benefits, education, and transportation, all programs that help the poor and middle class.
The argument that cutting taxes for the wealthiest will stimulate the economy in such a way that prosperity will trickle down to the ninety-nine percent of Americans who occupy the middle and lower classes does not stand up to scrutiny. Over the past decade when taxes were lowered by George W. Bush, the middle class watch its wages and income stagnate. In fact, the top one percent continues to see their wealth and income grow at rates far faster as middle class purchasing power diminishes. A quarter of a century ago, the top one percent of Americans took in about twelve percent of the nation’s income and control about thirty-three of its wealth. Today that one percent captures close to twenty-percent of the country’s income and possesses forty percent of the country’s wealth. According to Joseph Stiglitz, over the past ten years the top one percent of Americans have enjoyed an eighteen percent increase in income while the middle class incomes have declined.
In his essay in Vanity Fair, (May 2011) Stiglitz identifies a few facts that should make Tea Party members reconsider the logic of some of their positions. Almost all U.S. senators and the majority of house members have incomes that are in that top one percent. Moreover, when they leave congress, many of these elected officials will be rewarded with lucrative jobs by corporations whose agendas they have promoted. Congress has steadily become an institution of the wealthy for the wealthy.
A feasible way to pay down the debt and deficit would be to cut spending and increase revenues. Congress has read the report of the Bowles-Simpson Commission, which has devised a formula of spending cuts and tax increases that could reduce deficits by an estimated four trillion by 2020 and “stabilize the debt by 2014.” But rather than implement a sensible combination of cuts and taxes, which would spread more fairly among us all the burden of our economic woes, the Republicans would prefer to shield the wealthiest Americans from even the slightest inconvenience, since by serving them they can, in turn, serve themselves.
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