Wednesday, January 22, 2014
Trickle-Down Economics & Austerity Economics: Crimes Against Humanity
(President Franklin Roosevelt said, "I see millions of families trying to live on incomes so meager that the pall of family disaster hangs over them day by day...I see one-third of a nation ill-housed, ill-clad, ill-nourished." WPA poster, image courtesy of the Library of Congress Prints and Photographs Division. )
One of the major tenets of trickle-down economics is the granting of colossal tax breaks to the wealthy. In turn, we are told (lied to), the wealthy will use their increased wealth to create good middle-class jobs via investment. Hence, the super-wealthy are called "job-creators" by those on the political right.
(This woman is fully aware of the fraud of trickle-down economics. Image courtesy of bartcop.com.)
We have now had about 30-40 years of trickle-down economics. Top-marginal income taxes have been cut, capital gains taxes have been cut, and estate taxes have been cut. And, unsatisfied with historically low tax rates, large numbers of super-wealthy individuals engage in illegal tax evasion. The United States loses about $300 billion in revenue, every single year, to tax evasion, thanks to secretive offshore accounts, foreign banks, and fraudulent tax shelters. Further, corporations play states and countries against one another, threatening to leave and take their business elsewhere unless they get their lobbied-for tax loopholes (some multi-billion dollar corporations pay no taxes at all, through a combination of legal and/or illegal means).
To make matters worse, the political right is constantly seeking to implement austerity economics on Americans who need help. They work feverishly to reduce food assistance, reduce unemployment benefits, and reduce job training programs. They say that they are practicing tough love, and that government assistance makes people lazy and not want to work, but when we see the super-wealthy getting richer and not creating good-paying jobs, we know the truth: The political right is protecting the fortunes of the few by cutting programs that would require the fortunate few to pay a little more in taxes. Why? To rake in campaign cash, and to obtain lucrative jobs after their stints in Congress are over. Also, most Congressmen and women are rich themselves, so cutting programs that help the less fortunate protects their wealth too.
(When economic times got rough, New Deal policy-makers got tough. To address unemployment, New Deal policy-makers didn't throw more money at the wealthy and pray for the best, they created the Works Progress Administration (WPA), headed by Harry Hopkins (above). The WPA directly hired 8.5 million jobless Americans between 1935 and 1943. Other New Deal work programs hired millions more. And we still utilize much of the infrastructure work that these formerly-jobless Americans created. Photo courtesy of the Library of Congress Prints and Photographs Divisions.)
Trickle-down economics and austerity economics are not unique to America. Other countries around the globe have also implemented these economic philosophies--philosophies that concentrate wealth in the hands of the few, while persecuting everyone else with cuts to social programs, mass layoffs, and an array of regressive taxes, tolls, fees, and fines (e.g., sales tax, bridge tolls, motor vehicle fees, and traffic fines--all of which extract a higher percentage of income from the wallets of the middle-class and poor).
So, after 30-40 years of trickle-down economics and austerity economics, what are the results?
1. Massive income and wealth inequality: The 85 richest people in the world now have more wealth than the entire bottom half of the global population (see "Working for the Few: Political Capture and Economic Inequality"). In America, the richest 400 individuals have more wealth than the entire African American population of the United States (see "Wealth of Forbes 400 Billionaires Equals Wealth of All 41 Million African-Americans").
2. High unemployment: Far from creating good-paying jobs with their ever-rising wealth, the "job creators" seem to be thriving on mass unemployment (see, e.g., "More than 200 million people were unemployed in the world in 2013." In America, well over 24 million Americans wish they had a full-time job but can't find one (http://www.njfac.org/).
3. Stagnant wages and rising consumer prices: Americans aren't seeing the benefits of their higher productivity. Instead, their wages are stagnant while the 1% rakes in all of the increased profit. Meanwhile, the prices of goods and services, e.g., a college education and gasoline, have been rising for many years.
4. A soon-to-be tidal wave of old age poverty: In America, fewer companies offer fixed pension plans than in the past, in an effort to give higher returns to investors and larger bonuses to CEOs. The trend now is to offer stingier 401k's, which workers have a hard time contributing too (because of the aforementioned stagnant wages and rising consumer prices) and which are also cashed out by the workers to pay bills during desperate financial times (see "How the 401(k) revolution created a few big winners and many losers"). As if this were not bad enough, many on the political right (with the aid of weak or bought Democrats like President Obama) are out to cut or eliminate Social Security (see, e.g., "Peter Peterson Spent Nearly Half A Billion In Washington Targeting Social Security, Medicare" and "Warren, Sanders Ready to Face Down Obama over Social Security, Medicare Cuts").
5. Plutocracy: With greater and greater wealth, the super-rich give more and more money to our political "leaders." In turn, our political "leaders" cater to the rich and create policies that promote even greater wealth inequality. This allows the super-rich to give even more money to politicians, and the cycle repeats itself in a process that results in "political capture." In America today, instead of a government that serves the people, we have a government that serves the rich.
6. White collar crime: With greater amounts of political campaign contributions, and promises of lucrative job offers after their political careers are over, Congressmen and women have a great motivation to turn a blind eye to white collar crime. Indeed, after their massive crimes and wrongdoings, the movers and shakers of Corporate America and big financial institutions paid for their crimes, not with prison sentences, as had been done in the past, but with fines.....fines which are much less than the profits from such crimes & wrongdoings and, sometimes, amazingly, tax-deductible. As Richard Eskow writes, "The crimes committed at JPMorgan Chase include investor fraud, consumer fraud, perjury, forgery, bribery, violations of sanction laws against countries like Iran and Sudan, illegal foreclosures on active duty service members and their families ... The list goes on and on and on....And yet, instead of truly paying for their sins, senior executives of JPMorgan Chase have continued to get wealthy at taxpayer expense." Congress's response? Obama's response? You may have just heard a pin drop.
7. Debt collectors harassing Americans who lost their jobs due to the crimes perpetrated by the debt collectors' clients: The crimes and wrongdoings of Corporate America and big financial institutions caused a lot of people to lose their jobs and, hence, to lose their ability to pay their bills, e.g., credit card bills. How have the criminals and wrongdoers of Wall Street responded, after the government (i.e., We the People) bailed them out? By sending debt collectors to harass the people they financially devastated.
8. Increased rates of suicide: Suicides have been on the rise, and the CDC has reported that suicides rise when people experience tough economic times. However, you will rarely (if ever) hear Congressmen and women express concern about this. They're too busy figuring out ways to cut food assistance to low-income senior citizens to worry about the suicides that occur every 13.7 minutes in America. (According to the American Foundation for Suicide Prevention, one of the factors that increases the risk of suicide is "Prolonged stress due to adversities such as unemployment...")
9. In America, the largest prison-industrial complex in the world: Instead of an ever-expanding workforce, brought about by the job-creation miracle we were promised via trickle-down economics, we have the lowest labor force participation rate in America since 1978, and the largest prison-industrial complex in the world. That's what trickle-down economics has done for us: It's gutted our labor force and filled up our prisons.
10. An army of people who mindlessly say, "Work harder!": Perhaps the most ridiculous thing about trickle-down economics is the pull-yourself-up-by-your-bootstraps rhetoric that comes, like an endless toxic river, from the political right. Despite the data, and despite the facts, they will mindlessly repeat, year after year, "Just work harder if you want to succeed!!" It's as if they are saying, "Don't worry about the white collar crime on Wall Street, just work harder to compensate!" Their inane rhetoric is the icing on the cake in our Kafkaesque economy and labor market. Their embrace of rhetoric, disregard of data, and submissiveness to corporate greed, corruption, and crime is condemning us all to a very bleak future.
(In 1944, President Franklin Roosevelt called for an Economic Bill of Rights, promoting jobs, healthcare, education, and more. Sadly, we have turned away from Roosevelt's call, and instead embraced the gruesome and cut-throat philosophies of trickle-down economics and austerity economics. Hence, suicides are on the rise, people die from lack of health insurance, and many veterans who served our country end up homeless.)
Trickle-down economics and austerity economics are not only foolish, they are crimes against humanity. They sanction and foster high unemployment, financial devastation, homelessness, generational poverty, environmental degradation, healthcare exclusion, high levels of suicide, and inhumane levels of incarceration; all so that a small percentage of people can live in extreme wealth and luxury, without any responsibility to the larger culture (e.g., creating good jobs).
The only way we will ever escape from this mess is by strengthening existing New Deal policies (like Social Security), reviving forgotten New Deal policies (like the WPA and CCC), and implementing stronger New Deal-type policies. If we don't, then plutocracy, wealth inequality, and white collar crime will continue to grow. There's little else that can stop it, because the people who benefit from these perversities are getting stronger and wealthier every day.