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Creating the “Everyman” Fantasy Lulls Voters into a False Sense of Security

May 10, 2011

Lately I found myself thinking again how the GOP had fooled many again as they duped voters to vote for them in 2010 with the idea they would correct much of what they created themselves, unemployment and financial ruin for millions of working Americans.  Their Pledge to America emphasized jobs and deficit reduction.  The jobs situation was a real concern where the deficit problem was more a manufactured one that Republicans have successfully connected to unemployment in the minds of some voters.

Sure, there is a serious deficit issue but there has been for years but this may not be the time to ignore unemployment with the false notion that lowering our debt will make the bogeyman go away anytime soon.

In their Pledge to America, Republicans and Tea Partiers had a whopping four item plan to restore jobs.  They have ticked off two and claim they are still fighting to achieve the other two.

The two items they’ve claimed victory for are keeping tax cuts for the wealthiest 2% and the overbearing, job killing mandate where the IRS would require businesses to report any purchases over $600.   Say what?  Elimination of all that added IRS paperwork is going to create jobs swiftly, how?

They don’t mention that the Democrats were ready to approve extending the Bush tax cuts for 98% of American tax payers and how the GOP refused to allow that many Americans to benefit from this unless they could bring their millionaires and billionaires buddies along too. Who says Republicans are unfeeling?

One of the two “job creating” ideas that they have yet been able to get past the talking stages is what they refer to as “reining in red tape”.  The only other one is allowing small business owners to take a tax deduction equal to 20 percent of their business income.  Killing red tape boils down to Congressional approval of any federal regulation that has an annual cost to our economy of $100 million or more.   It really isn’t all that clear how this is a job creator in the near term but then you expected a rational plan of action from a Party who spent and borrowed us out of a $1 trillion surplus into a $500 billion deficit in four short years?  And as for that small business tax deduction, well … there still working on that one.

In cutting deficits they have achieved the following:

  • With the passage of H.Res. 22, House Republicans saved $35 million annually by cutting their in-house spending by 5%

That’s it.  They do have some “bold pans” to cut billions more but that has run into a voter backlash as they attempt to cut most spending in areas that affect our most vulnerable citizens.  But be patient.  Remember those extended tax cuts for millionaires and billionaires?  The trickle down effect ought to be kicking in any decade now.

Let’s look at what the GOP House has passed on deficits.  One bill eliminates federal grants to states to set up health insurance exchanges  and another would repeal a section in the 2010 health care bill providing funding for the construction of school-based health centers.   Notice these are areas that impact low-income families with children and the elderly on fixed incomes.

If your saying to yourself, where’s the cuts in a bloated defense budget and elimination of federal subsidies to profitable oil companies, don’t hold your breath on such sacrifices coming from the wealthy sector of the American economy.  Besides, Republicans and Tea Partiers are too busy passing redundant legislation that anti-abortionists activists have clamored for.  The bill that has taken up a lot of their time is one that doesn’t allow federal funds to go towards any abortion except in the case of rape, incest or danger to the woman’s life; pretty much what the Hyde amendment has been in force to do since 1976.   Jobs, schmobs.  They’ll get it done at their own pace.

Not only have GOP conservatives and Tea Partiers done nothing to effectively create jobs, they have boondoggled legislation that takes from the weakest and neediest while sustaining those advantages for the wealthiest whose drive for many of them to satisfy their own self-interest made them even richer as people’s health care, wages and homes were taken from them.

Once again I am amazed how so many voters keep voting against their own self-interest.  Part of it lies in an ideal that if it ever existed at all, it did during a brief time when the nation was rapidly expanding its economic base back in the early 19th century.  An article by Chrystia Freeland best describes the mentality of Americans who just can’t let go of the myth that there really is a shot for them at being the next millionaire in this country with just a little “grit and gumption”.

“Aside from faith in American national excellence, the other main reason Americans seem so unperturbed by the widening chasm between the rich and everyone else is what I like to call the lottery effect”, Freeland asserts.  It’s an irrational act but one that many believe will bestow “fabulous rewards on the Everyman”

“[T]he problem with lotteries”, Freeland reminds us  “is that there are only a few winners. That is the story the numbers tell us about American capitalism today — and unless that underlying reality changes, [many will realize too late that] they live in a winner-take-all society, and that most of us aren’t winning.”


The GOP capitalizes on this fantasy and as long as they can we will continue to put them in positions of power that props up the wealthiest with a false narrative that “everyman” has an equal opportunity.

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Posted by in 2012 Presidential Elections, Budget Crisis, Jobs, Society and Politics Tags: , , , , , , , , , ,

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The GOP’s Mubarak Mistake – Ignoring the Need for Jobs

February 20, 2011

Without skipping a beat, as soon as the GOP regained control of at least one house in the U.S. Congress and numerous state governorships and legislatures, private corporate interests have taken precedence over public issues again.

Illinois wants Wisconsin's rejected stimulus funds - Chicago Tribune

THE PEOPLE STRIKE BACK

At the core of any social unrest is the failure of government to meet the needs of most people.  Economic interests lie at the top of any list that can spur protests and even riots from a country’s population.  So when jobs become scarce and the cost of goods and services start getting out of hand, the government that’s seen as ignoring these or just poorly managing the efforts to correct them are likely to experience what is going on in the Mideast now and what we’re beginning to see here, in Madison, Wisconsin.

In Egypt for example, political repression was definitely a factor there and the one we are most likely to think that Egyptians railed against primarily.  But for people who have studied this closer and who are more familiar with the Egyptian culture and economy, that popular uprising was a reaction to the corruption in their government over the last three decades that had focused most of its energy on those well-healed few to the detriment of the majority.  Too many were unemployed and hungry from serious food shortages while the friends of Mubarak lived relatively comfortable lives.

Two to three years ago here in the states, as the economy reached its fever pitch with high unemployment rates while government leaders bailed out large financial institutions, the majority of us were losing our jobs, homes and any future plans we had been saving up for.  The efforts of the Obama administration with the Democrats to deal with the crisis that was left from the previous administration only partially succeeded to ameliorate the job losses with its stimulus package.  Their efforts were viewed by many as going too far while others, like me, felt it did too little.  Again, too many in the lower socio-economic strata were suffering while those in the upper-income sectors were not, and who in fact soon bounced back better than before.

Today’s reality is that the economic gains on Wall Street are not being matched on Main Street.  Corporate profits are at record levels while more people now are unemployed than they have been since the 1980’s under Reagan.  But the factors that allowed the economy to grow quickly before Reagan left office are not in place here to spur on a similar recovery.  And to make matters worse we have a political Party in some positions now that has been pushed further to the right by a Libertarian element.  Yet this reconfigured Republican Party seems as oblivious as it did under Bush/Cheney to the plight of most people as they fix their sites on the deficit by cutting jobs in the public sector.  This is being done with cavalier disregard too as expressed by one of their leaders who flippantly declared, “so be it”.

“Over the last two years since President Obama has taken office, the federal government has added 200,000 new federal jobs,” [House speaker John]Boehner said. “And if some of those jobs are lost in this, so be it. We’re broke.” As usual the Speaker of the House was being deceptive and disingenuous.  According to FactCheck.org, the  “actual number of federal jobs that have been created from January 2009 to January 2011 is nowhere near 200,000.”  And declaring that we’re broke is true enough but how we got there is worth noting since the weight of our debt lies largely on those who have dismissed the needs of the general public over the last 10 years.

SOWING THE SEEDS OF DISCONTENT

While pushing us into two wars and spending billions on tax cuts for the wealthiest 2%, an economy that struggled for eight years under George Bush finally collapsed in his final year from his and the GOP’s failure to restrain greedy financial institutions.  These factors along with a spend-and-borrow funding policy and a housing bubble that burst from lax regulatory standards on lenders wiped out a trillion-dollar surplus in those eight years and left the incoming administration with a huge record deficit at the time; putting a huge hole in our economy that would not be repairable anytime soon.

Angry voters, apparently with very short memories, bought in to the straw man arguments two years later that the GOP and their Tea Party allies put out there, blaming all this on Democrats and making many of them scapegoats in the 2010 elections.  For that achievement of theirs we are now left with the FOX in the henhouse to wreck even further havoc to the general working population.

Their plan is to perpetuate the myth that spending cuts in the public sector will be our main salvation  from economic devastation and that more tax cuts (especially from the top 2%) that rob the treasury of needed revenue to pay down the deficit will miraculously turn our sinking ship around.  It is once again the neo-conservative Grover Norquist’s wet dream of reducing the federal government “down to the size where we can drown it in the bathtub.”

Believing as they do that when the wealthiest of us prosper, we all do, through the naive theory of supply side economics or as it’s better known, “trickle down economics”.  Trickle down economics relies on low marginal tax rates so entrepreneurs can put more of their profits back into their businesses; in so doing this should create more jobs.  Most small businesses do this.  However, what we are seeing instead is reinvestment of profits by many large corporations into high yield financial products, like derivatives and the profits on these are going more back into stock holder dividends and executive bonuses rather than new job creation.

By killing off public sector jobs then you have a means of reducing the taxes that help pay for these jobs; taxes that when eliminated can now lower those marginal rates for businesses.  So now we’ve come full circle where government leaders are more bent on meeting the needs of a well-healed contingent – corporate special interests.

Projected as a means for reducing the deficit, the sum effect here is actually intended to increase the wealth of a few.  If the GOP were seriously focused on reducing the deficit you would see reasonable tax increases, realistic policies to reduce health care costs, federal subsidies to large corporations being axed and bloated Defense Department budgets shrunk.  But that is NOT what we are seeing.

The social unrest occurring with teachers in Wisconsin is just the beginning of a public outcry on what were the results of mismanaged budgeting by conservative governors and legislators.   The next battle ground for similar disruptions could be in Texas where teachers, parents and students plan to rally in front of the state capital March 12th in Austin to decry the legislature’s attempt to correct a budget shortfall of anywhere from $15 to $27 billion.  This shortfall resulted from lowering property taxes back in 2007, hoping newly increased cigarette & gas taxes along with a small business tax would compensate for this take away in revenue.  It failed miserably.

THE VALUE OF PUBLIC EMPLOYEES

Public sector workers are those people who keep our communities safe, orderly, educated and clean like police officers, fire fighters, teachers, sanitation workers, street and utilities maintenance workers, county court and records employees and many others.  These are all important services needed to promote the general welfare of this country and its economy.

Despite the claims made by corporate-friendly wags, a recent study by University of Wisconsin-Milwaukee economist John S. Heywood shows that “U.S. averages were 11 percent less pay for state employees than for their private-sector counterparts and 12 percent less for local government workers”.”  Heywood doubts that lower levels of union membership explain much if any of the public-private sector pay differences here.  “Now is not the time for a large-scale rollback in the compensation of state and local workers”, Heywood noted as “states face huge budget gaps [and] federal stimulus money recedes [while] the economy recovers slowly from a deep slump.” (Texas public sector pay 17% lower than private, report says by Robert T. Garrett, Dallas Morning News, 4/29/10)

The Tea Party-friendly Republican governors in both Wisconsin and Texas have vowed to consider only cutting spending on public sector jobs as a means to reduce their budget shortfalls.  Creating revenue through taxes is out of the question.  Other states who have recently elected politicians sympathetic with Tea Party values like Minnesota, Ohio and Indiana will be watching these two states closely to see if the outcomes are in favor of deep public sector cuts.  If that does indeed turn out to be the result we may well be able to hear the $$$ cha-ching $$$ sounds going off in corporate boardrooms around the country.

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Posted by in Health Care Reform, Jobs, Society and Politics, Texas/Local stories Tags: , , , , , , , , , , ,

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Hard Times Force Some to Take Drastic Measures

February 12, 2011

In a real life incident played out recently in my home town, the effects of the recession are made clear to a store clerk who was confronted by a desperate father.

As I have done in the past, I have reported on real life situations here in my North Texas town of Denton as they are reported in “The Blotter” section of the Denton Record-Chronicle.  The Blotter provides small pieces of information about mostly mundane and normal occurrences that the police department responds to.   On occasion there are some that go beyond this definition.  One in today’s newspaper is both disturbing and reflective of the economic times we are experiencing.

As it was conveyed here, a man apparently tried to rob two local convenience stores with nothing more than “a small knife”.  The first attempt failed after the would-be thief was told there was no money and was told to leave by the clerk.  He did.  “The man ran out of the store”, the report said.  After police were called following this incident they checked around at other convenience stores and found that another attempt had been made on the other side of town that fit the description of the failed thief earlier.

The details of this encounter are minimal but striking, so I will convey them in a manner that will undoubtedly embellish the sequence of events but do so without trying to stretch such an outcome beyond the realm of possibilities.  I know the owner of this second store from doing business with him on occasion.  He is most likely of Indian dissent but could be Mid-eastern.  He is always courteous and pleasant and his store is located in a part of town where he seldom experiences much traffic, even though it is located off of a main artery into Denton from Ft. Worth.

It appears that after the alleged thief entered the store he “demanded cash”  but was told “there was no cash in the register.”  Based on the earlier instance where the man fled in haste I’m sure the hopes of the thief were shattered at this point.  He was told by the clerk to “get a job” and at the point it appeared the man broke down crying and told the store clerk that “his kids were hungry”.

A job would have been nice but because many are out of work due to the recession some have been forced to compete with at least 5 other people for pretty much every job out there that is available.  I’m not saying I know what this particular man’s situation was but it may be safe to assume that he is one of the many unfortunate ones who come out on the losing end of this agonizing effort to “get a job”.  It may also be safe to assume that he has been out of work long enough to be ineligible for any further unemployment benefits from the state.

I don’t condone this man’s attempt to steal in order to provide basic essentials for his family under these tough economic times.  I don’t know if he even tried the area food banks to feed his children.  But even if he had the news is gloomy here too because food banks run out of supplies long before they can accommodate all those who come to them in need.

With such dire prospects some may muster the misdirected courage to take extreme measures and turn to criminal behavior to survive.  It’s clear this situation didn’t go unnoticed to the store clerk.  I’m sure his business struggles to make ends meet and even more so following the bad weather we’ve had of late that perhaps even prevented him from opening his doors for three to four days as streets were treacherously iced over for that long.

Yet the pathetic condition that his assailant became overcome with touched the heart of the store clerk and he pulled out “a few bills from his own pocket” and gave it to the man with the small knife.  The would-be thief left and the police are doing what the law requires and making an attempt to find him.

This small display of both the decency and the frailty of the human condition surely goes on everyday yet we are often led to believe that we are not our brother’s keeper by those who are comfortably well off and view any efforts by a representative government to intervene at some level as “socialism”.  How easy it is to pass judgment from those whose giving falls way too short to meet the needs of the working poor and the vast new numbers on the unemployment rolls.

We should never condone crime of any kind that forces someone to steal but neither should we condone behavior that ignores the causal effect to some who take such drastic measures.  We can only hope that this poor man is both scared and remorseful that he took such drastic actions and that the police efforts are restrained in their attempts to catch him.  We can also hope that some of those hardened hearts who read the Blotter account of this crime will get out of it what I have here and become a bit more flexible in reaching out to those in need, even if it is a part of the social safety net implemented by government sources.

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Congress Shows Concern for Wealthy Oil Companies to the Detriment of U.S. Education and Job Creation.

February 5, 2011

In a recent display of affection for wealthy corporate interest, conservatives have once again come through for those who keep their boats afloat on a rising tide that has swamped the smaller fishing rigs

Once again, the Senate has failed to muster enough votes to end the federal subsidies for the oil industry that forks out roughly $4 billion a year of tax payer money to multi-national corporations that have generated nearly a trillion dollars in profits just amongst the top five producers over the last 10 years.  Those top 5 corporations and their 10 year totals (in parenthesis) consist of BP ($158 billion), Chevron ($147 b), Exxon ($326 b), Conoco ($100 b) and Shell($219 b).  All of them last year alone made no less than $4 billion (BP) and as much as $31 billion (Exxon/Mobil).  So why are we dumping money into these overflowing vaults at a time we are struggling to reduce our deficit and sustain efforts to promote education and job creation?

$4 billion a year isn’t going to make a big dent in the national debt that is hovering just above $14 trillion at this time but it will offset some ugly cuts in the states where education is taking a serious hit to trim budgets there.  It is also money not being invested in 21st century job creation with renewable energy sources and technology.

Let me put this another way.  Oil companies, their CEO and top executives, stock holders and their supportive financial institutions are rolling in excessive dough while teachers are being summarily dismissed from classrooms and forced to join the ranks of the unemployed during the worst financial crisis in this country in the last 80 years.  Likewise in an industry whose limited resources are already being outpaced by growing global demand, this $4 billion a year would go along way to create new jobs for green energy businesses that are destined to grow exponentially in the near future.   Are there some values seriously skewered here?

And correct me if I am wrong but when you’re averaging profits of $95 billion each year after you have cleared your expenses, including salaries and bonuses for everyone, why do you need an extra $4 billion a year from tax payers.  Well, according to big oil state Senator David Vitter of Louisiana, there needed to offset “the highest business tax rate in the world”.  However, whenever a pro-corporate mouth piece like Vitter speaks, you can be assured the devil is in the details.

 

It’s true the U.S. has one of the highest corporate tax rates in the world, up to 35% in some instances.  But this is not only NOT an across the board fixed rate but it is diminished by many loopholes built into the tax code where essentially corporate rates are lower than middle-income wage earners.

According to a piece in the NY Times last July, “the most recent study by the Congressional Budget Office, released in 2005, capital investments like oil field leases and drilling equipment are taxed at an effective rate of 9 percent, significantly lower than the overall rate of 25 percent for businesses in general and lower than virtually any other industry.  And for many small and midsize oil companies, the tax on capital investments is so low that it is more than eliminated by various credits. These companies’ returns on those investments are often higher after taxes than before.”   

So much for the absurd notion that the wealthiest and most profitable industries in the world are unduly taxed.  And though the Senate was seeking to redirect these funds to help alleviate the cost needed to “pay for easing paperwork requirements for small business under President Barack Obama’s health overall law,” they decided instead to allow this oil subsidy to continue while passing “an alternative plan to pay for the $22 billion estimated cost over 10 years ($2.2 billion per year) of the small-business provision”, using unappropriated federal funds.

Instead of redirecting $4 billion a year away from highly profitable corporations to help provide better education and jobs for our children’s future, the Senate has in effect kept $6.2 billion a year of tax payer money away from issues where we are not even in the top 20 globally in student performance on Reading, Science and Math and where job recovery has not kept pace with Wall Street’s recovery.  Corporate earnings are at peak levels by some reports and earlier this week the Dow went over 12,000 for the first time in 3 years.

For those who might suggest that such subsidies are needed to offset price fluctuations with oil due to global unrest in oil-producing states, I would point out that such volatile conditions are always anticipated by the oil industry and crude oil prices are increased automatically when such an impact seems likely.  These price increases are always higher than what production costs are during these periods.

For instance, the recent upheavals in Egypt pushed benchmark crude up $3.70 to $89.34 a barrel on the New York Mercantile Exchange, according to a Wall Street Journal story last Monday.  But according to the Energy Information Administration (EIA) oil production costs “ … can range from as little as $2 per barrel in the Middle East to more than $15 per barrel in some fields in the United States, including capital recovery. … technological advances in finding and producing oil have made it possible to bring once-expensive deepwater Gulf of Mexico oil into production for less than $10 per barrel.”

In light of the recent outrage where GOP Senators refused to extend unemployment benefits to out of work families last December until they got their tax increases for the nation’s wealthiest 2%, I find it amazing that voters are not taking to the streets like many Tea Party types did in 2009 when the government bailed out Wall Street financial institutions and left Main Street to fend for itself.

Those these loans have been paid back in full it is clear where the mind-set is for conservative legislators when it comes to spending tax payer money.  There’s always enough federal largess for those who have enough but only Republican indifference for them that have lost their jobs, their homes, their savings and their futures.

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