I don’t think it takes a rocket scientist to understand what is wrong with our economy today and what steps might help improve it. We have had two great depressions in our history. The one beginning in 1929, denominated the Great Depression, which lasted until 1939 and which probably only ended because the United States spent billions of dollars to produce war materials and hired millions of men to fight in those wars sending home money to families to buy the limited consumer goods available. The Cleveland Depression of 1893 lasted seven years - the government did absolutely nothing, although it may have worsened the situation by reducing the money supply - limiting coinage to gold and rejecting bimetallism. Now we’re in the Bush Depression (they are calling it the Great Recession because no one wants to use the D word) which began in 2008.
We have millions unemployed, we have more underemployed and many no longer seeking employment. Consumers are not spending as they should because they don’t have the money to buy. Confidence in the economy is going down. The stock market after rebounding is now a roller coaster heading downwards. And the rest of the world - because we are now in a global economy (although the Depression of 1929 had many international components as well) is economically faltering, Japan due to the tsunami; Greece, Spain, Italy, Ireland and Portugal due to too much debt.
The US no longer manufactures as many goods as we once did. We have become a service economy which is dependent upon consumers being able to afford the services of others. And much of that service economy has become mechanized due to computer technological advancements.
The political landscape is so polarized, and so ideologically divided, that every suggestion to improve the economic situation is reacted to based on whose idea it is, which party supports the idea, and whether it will improve the standing of President Obama.
The radical Republicans say adopt the Grover Cleveland/Herbert Hoover approach and do nothing - the market will adjust itself. Tell that to the people who can’t afford to buy food at the produce market. These same right wingers say cut taxes on the rich so they will spend money to create jobs and prosperity will trickle down. Trickle down was a term first used by Theodore Roosevelt, who used it derisively. Because nothing has ever trickled down. Further, they want to cut all government spending. Reduce the number of federal and state employees - create more unemployed workers who can’t afford to feed and clothe their families.
The Democrats offer little more than the ideas of the New Deal. Now, I support those ideas but the FDR programs like the Civilian Conservation Corps, the Works Progress Administration were designed to alleviate the pain and horror of the Depression - they were not long term job growth programs. So liberals need to come up with new ideas.
We know that small businesses create the jobs. We have no more large factory manufacturing base in this country. So let’s relax regulations on small businesses; let’s reduce some of the tax and cost burdens on small businesses.
We can add stimulus to consumer purchasing by forgiving the millions of dollars of student loans putting those monthly payments in the hands of the most willing to spend of our demographic groups.
As for the large corporations, that are making record profits, let them pay their fair share and not hide money overseas and pay little or nothing due to loopholes; let those increased revenues enable us to retain needed public employees, repair our nation’s infrastructure (a sure way to create jobs) and stop the increasing of the national debt.
There is no reason that every citizen shouldn’t pay social security taxes and Medicare taxes on their full annual income; and there is no fair excuse why the very rich (those making over $500,000 individually per annum) shouldn’t pay the tax rates they paid under Clinton and Reagan. One thing the New Deal, followed by the post war Fair Deal of Harry Truman, and basically accepted by Eisenhower and Nixon, did was create an America with a small upper class, a huge middle class and beginning with LBJ’s Great Society programs a shrinking lower class. We should get back to that instead of the two class society we are now building of super haves and have-nots. America is better than that and always has been. We have been a nation that believed that all of us as a society can help lift those up who are fallen down. As JFK put it that “a rising tide would lift all boats”. We can be a nation with equal opportunity for all to enjoy that pursuit of happiness that our founders pledged their lives for.
28 June 2011