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Thursday, April 14, 2011

A path to prosperity that benefits more than just the rich

A true path to prosperity

Supply side or trickledown economics has not worked; well it hasn’t worked for the vast majority of us. The wealthiest fifth of the population control ninety percent of the wealth. How much they control has grown exponentially while the middle class has been nearly squeezed out of existence. Regan and his idea that if he cut taxes for the rich and regulations for business that money would eventually create more jobs started about thirty years ago. We gave it its shot and its time we tried something else. I have an idea.

If you are one of those fortunate few at the top you may be against this idea but that would make you both soulless and short sited as a true path to prosperity would benefit everyone.

What if instead of cutting taxes on the wealthy and big corporations, we dramatically cut taxes on the middle class and small businesses. You know the middle class many of whom have been reduced to little more than pay check to paycheck living in fear of an illness or an emergency and have been taxed, fee’d and deducted nearly out of existence. Right now the middle class has less money to spend on goods and services than ever before which in turn mean those at the top are reap fewer profits. If the middle class were suddenly flush with cash that would solve their problem as well.

Do you think the middle class would just going to sit on the money, like corporations and the rich have been doing recently (Fox news said corporations and banks are sitting on trillions of dollars)? No they are going to spend it and partly because they have too. A lot of families as they fell farther and farther behind had to put off purchases, well now with more money they will be able to make them.

If the middle class had more money this would mean we would have a hundred million Americans buying new durable goods, eating out in restaurants and taking vacations. The middle class spending this money is going to lead to the creation of more jobs which in turn will mean even more people spending more money. Trickle down/voodoo economics hasn’t created the sustainable growth that the republicans of the eighties thought it would (if they thought it would anyways), isn’t it time we tried something else. How about we trickle the economy up instead? A common definition of insanity if doing the same thing over and over and expecting a different outcome, we have been running the economy the same way for a generation now and this is the first generation that can expect it’s kids to do a worse than they did.

I will hand it to the republicans, they are right we do need tax cuts and they do need to be dramatic but they have picked the wrong group to hitch their wagon too. The rich and corporations don’t need any more pay tax cuts, no; the tax cuts need to be for the middle class. What do you think would be better for America, a hundred million people with increased buying power or a couple million with ridiculous buying power, though in my pathway to prosperity they most likely will prosper too?

Who is the middle class going to be buying their goods and getting their services from? Who is the middle class going to be making their mortgage payments too (and more people owning houses is generally recognized as a good thing). The corporations and banks of course which means more profits for them and more money for their owners.

You know what also benefits? Health care and education too that means our elderly and our children who are constantly on the chopping black will get a reprieve. Even though taxes are lower if we have more people working and if we time it out right this means more money would be coming in for those necessary societal functions and if our health care and education improve that will lead to even more revenues. How do we lose? What’s the down side?

If we close the corporate loopholes that allow so many corporations to pay nothing and allow the bush tax cuts on the wealthy to expire I get how it might seem like the rich will be paying more but if we take this money and use it to dramatically lower the cost of living for the middle class, those at the top should be able to make back their money and then some. Here is the most important thing, even if I am wrong hasn’t the middle class carried the burden for long enough and what’s the down side for the rich? They aren’t quite as rich? Even if that is the case they will be living in a better educated, healthier and more secure society and that produces some tangible benefits as well.

The truth is even if we cut all our discretional spending, about thirteen percent of the budget our deficit will still be hundreds of millions of dollars and our debt would still continue to grow. If we cut social security and Medicare we will be shirking our responsibilities to the generation that came before and be putting a disproportionate part of the burden on the shoulders of those who depend on those two entitlements. Friends quite frankly our elderly, disabled and sick already having a tough enough time as it is.

What I saw from Ryan’s plan was immediate tax cuts for the rich and corporations, and if we have kept their taxes purposely low so they would create jobs we have gotten a pretty poor return on our investment, and them him passing the load of propping up our society onto the backs of the poor, sick, elderly and disabled. The middle class it seems are left in a vast wasteland of uncertainty. A few benefits, those that need it the least but the vast majority of American’s don’t.

Friends we are not heading towards an oligarchic society we are living in one. A small percentage of the population and a few corporations control the vast amount of wealth and the rest of society argue over table scraps. Then the tea party uses Anne Rand and her manifesto Atlas Shrugged as blue print how to do things. Ms. Rand had a pathological hatred of communist Russia but do you know what other society like ours that had an elite class that controlled most of the wealth and a vast lower class fighting for survival? Communist Russia that’s who and we know how that came to an end. What’s it going to take for those at the top to realize if they squeeze the turnip to much it may just turn and bite them? The way we are doing things is not sustainable, if the rich want to maintain their way of life it would greatly benefit them to give some concessions, concessions that may just see them get even wealthier.

The slumbering middle class won’t be distracted forever. Abortion and gay marriage have given way to public sector workers, teachers and unions being the bad guys but we are starting to wake up to the fact those are smoke and mirror boogey men designed to keep us in our place while the powers-that-be laugh themselves to the bank.

We need our leaders to step up and do the right thing and put all of America on a path to prosperity not just make sure a few who are already there prosper even more. The backs of the middle class can’t take much more.

Extra, what about this, what if we has a tax scale that started at five percent and then increased by five percent every hundred thousand dollars until it topped out at fifty percent. A hundred thousand or less you pay five percent, a million or more you pay fifty and no more loop holes either, unless it’s about deducting education and health care costs or mortgage interest. I know on the high end that sounds like a lot but eventually they should be able to make that money up, and until they do so it would benefit the vast majority of us.

1 comment:

  1. I think we must mandate buy american along with any raises on the large corporation to move the jobs back from overseas. Durable good prices would go up but the government could subsidize necessities like transportation. In addition we need to start a national infrastructure build out of Nat Gas to make it a true alternative to oil. This true competition will drive the price of oil down and the build out will respark the economy like the highway infrastructure build out did for the great depression.