Tag Archives: Economy

I’m Shrinking!

Yes, the middle class has been disappearing.  It started with the Reagan years when the tax code was written with breaks for specific companies.  Some corporations received huge tax breaks while others had their taxes increased.  It was described as “trickle down” economics which actually started to gush money to the top 5% of Americans.  At the same time, the middle class, ever so slightly, began to diminish.

The economy had ups and downs over the years following the Reagan bandits (Savings and Loan bailouts) while the middle class continued to lose ground.  During his presidency, George H. W. Bush made an announcement that we are now a “global economy”.

Next came NAFTA which was signed into law by President Bill Clinton.  The idea of NAFTA was born during the George H.W. Bush years and it was Ross Perot that brought the voters attention to NAFTA and “the sucking sound” of jobs leaving this country.  President Bill Clinton signed NAFTA into law and American companies began building factories in Mexico.  This creation of manufacturing jobs in Mexico gave Mexicans the opportunity to earn a living wage.  Over the years, these same corporations that provided a living wage kept lowering the wages of Mexicans to the point where jobs in Mexico are now poverty jobs in sweat shops.  This decrease in income has fueled the drug cartels and has increased violent crime along the Mexican border.  That’s a story for another time.

So far, we have special tax breaks for specific corporations and NAFTA.  Then in the year 2000, the US Supreme Court appointed the rich man’s tool as president, George W. Bush.  His appointment accelerated the loss of jobs by providing tax incentives for corporations to send jobs overseas.  How unAmerican and unpatriotic.  The Bush administration also lowered taxes for the top 5% of Americans, the very rich, while keeping taxes high for middle class Americans.  Along with two wars, the Bush tax cuts created a huge Government deficit at the expense of middle class Americans.  Since the birth of Reaganomics, the wages of the middle class have slowly declined or remained stagnant.

Here are 22 statistics proving the decline of the middle class…

#1) According to a poll taken in 2009, 61 percent of Americans “always or usually” live paycheck to paycheck, which was up from 49 percent in 2008 and 43 percent in 2007.

#2) The number of Americans with incomes below the official poverty line rose by about 15% between 2000 and 2006, and by 2008 over 30 million U.S. workers were earning less than $10 per hour.

#3) According to Harvard Magazine, 66% of the income growth between 2001 and 2007 went to the top 1% of all Americans.

#4) According to that same poll, 36 percent of Americans say that they don’t contribute anything to retirement savings.

#5) A staggering 43 percent of Americans have less than $10,000 saved up for retirement.

#6) According to one new survey, 24% of American workers say that they have postponed their planned retirement age in the past year.

#7) Over 1.4 million Americans filed for personal bankruptcy in 2009, which represented a 32 percent increase over 2008.

#8) Only the top 5 percent of U.S. households have earned enough additional income to match the rise in housing costs since 1975.

#9) For the first time in U.S. history, banks own a greater share of residential housing net worth in the United States than all individual Americans put together.

#10) In 1950, the ratio of the average executive’s paycheck to the average worker’s paycheck was about 30 to 1.  Since the year 2000, that ratio has exploded to between 300 to 500 to one.

Read more and all the supporting data here

The negative effects of the Bush years washed over from 2008 into 2009.  It took eight years to destroy our economy and it will take at least eight years if not more to repair the damage done by the Bush administration.

President Obama’s stimulus package included a reduction in taxes for 95% of Americans.  As a member of this 95% grouping, I received a tax refund this year, the first one in many years.  My taxes increased during the Reagan years and this is my first tax break since then.

Trickle down economics is a joke on the American people.  It only increases the income for the top 5% while the rest of us struggle.

One more thing about the George W. Bush years, job creation remained stagnant.  For the first time in over 20 years, there were no job increases.  As a matter of fact, by the end of the Bush years, the job losses were on the rise and at the same time, the rich continued to get richer.

What is the Republican plan for job creation?  The Republicans still stand by their “trickle down” economics theory and they insist on continuing tax breaks for the rich while at the same time providing no tax breaks for the middle class.  If given the opportunity, the Republicans would repeal the Obama tax breaks for the middle class.  Don’t be fooled by their rhetoric because Republicans don’t have the welfare of the middle class in mind when they speak.  It’s all about Wall Street, big banks and corporations with them.

Trickle down economics… how is that working for you?  It’s working for the quitter, Sarah Palin and the cult leader Glenn Beck.  It’s not working for their followers and their followers are like the Branch Davidians or Heaven’s Gate.  They will do anything that their leaders, Beck and Palin, tell them to do, just like puppets on a string.  These money machines (Beck and Palin) are only interested in increasing their income, not yours.

On Becoming A Poor Nation

Let’s face the facts.  Our local governments are in a financial crises.   With the loss of jobs, comes a decrease in State income tax revenues.  Smaller State revenues means that there is less money to help struggling cities and towns.  Add to this, the decrease in sales tax revenues that are the result of less purchasing power, and we have a State going bankrupt.  Now, multiple this by the number of States near bankruptcy and we have a nation of the edge of becoming a third world country.

As States become poorer, they need to make cuts to their spending.  One of the many areas where they choose to make cuts is in funding for education.  That means that our children suffer by not receiving a full education.  Poor education will not help these children when they become adults because they won’t be able to find a job that pays a living wage or better.  Ignorance is NOT bliss.  It leads to poverty.  The greater the poverty, the closer we are to becoming a third world country.

Even though only about 10% of Americans are heavily invested in stocks and bonds, our economy is driven by the DOW.  In order to grow, we need an economy based on jobs that produce goods.  Our nation has been slowly losing its goods based economy.  Instead, our economy is based on market gambling.  There is no bartering for goods and services in this country.  We can’t “take a chicken to the doctor” because banks won’t accept chickens as mortgage payments from the doctor.  (I’m curious about this “chicken”.  Is is a live chicken or a dead chicken?)

Do you see the pattern?  It a vicious cycle, one that Republicans claim can only be fixed by cutting taxes which decrease revenues.   Understand, the taxes that get cut are the taxes to the richest 1% of Americans and the services that get cut are the services needed by the other 90%.  The Republicans and Tea Partiers support Reagan economics.  It was during Ronald Reagan’s presidency, when the decline in the middle working class started.

The bottom line is this… we need jobs based on goods that pay a living wage or better so that the States and local municipalities can collect the revenue needed to keep our governments functioning.   This includes ample money for police, firefighters, educators, libraries and infrastructure repair and maintenance.  More tax cuts for the rich will not produce jobs and will not bring in more revenue.  Instead, it starves the masses.

One question before I end this thread, how is that “trickle down” economics working for you?

Corporate Crybabies – People vs Corporations _UPDATED

Yesterday, President Obama addressed the tax breaks that corporations receive for sending our jobs overseas.  Yes, corporations are making millions and millions of dollars and NOT paying taxes and then sending OUR jobs overseas so that they can continue to not pay taxes to our government.  Keep in mind, these same corporations pay their executives millions and millions of dollars and pay their employees the low wages of India and China.

The proposal takes aim at what corporate executives consider to be one of the most critical features of the U.S. tax code: permission to indefinitely defer paying U.S. taxes on income earned overseas.

Currently, U.S. companies can avoid paying taxes on foreign profits until they bring the money back home. So a U.S. company doing business in Ireland, for example, must pay the Irish tax of 12.5 percent, like every other company doing business in Ireland. But the U.S. firm would owe an additional 22.5 percent to the U.S. Treasury (the difference between Ireland’s tax rate and the 35 percent U.S. tax rate) unless it reinvests the money overseas.

Hum, “permission to indefinitely defer paying U.S. taxes”, that sounds like a good deal.  What that means is there is no incentive to bring  jobs back to the United States.  It provides incentive to keep sending jobs overseas.

If we are to recover from this depression without continuing to bailout banks, then we need jobs, here, on the U.S. soil.

Some in Congress are hesitating support for this change in our Government tax plan.

“Further study is needed to assess the impact of this plan on U.S. businesses,” Sen. Max Baucus (D-Mont.), chairman of the Senate Finance Committee, which has jurisdiction over U.S. tax law, said in a written statement. “I want to make certain that our tax policies are fair and support the global competitiveness of U.S. businesses.”

The American worker has always produced superior products.  Back in the ’70’s, the mantra was buy “Made in the USA” because purchasing products made here, gave an American a job and was always of high quality.  It’s difficult to find something “Made in the USA” anymore.  Most items are made in sweat shops that employ children in third world countries.   While these sweat shops produce cheap and inferior products, like all (slave labor) sweat shops do, the corporations make millions of dollars and do NOT pay U.S. taxes.

(President) Obama proposes to move in the opposite direction. He argues that the current system gives tax breaks to U.S. multinationals at the expense of companies that operate solely on American soil. In 2004, the most recent year for which statistics are available, U.S. multinationals paid an effective U.S. tax rate of just 2.3 percent on $700 billion in foreign profits, according to the administration.

“It’s a tax code that says you should pay lower taxes if you create a job in Bangalore, India, than if you create one in Buffalo, New York,” the president said yesterday.

The President is correct.  Why should multinational corporations receive tax breaks while companies that operate solely on American soil not receive a tax break.  The Republicans are always chanting “small business”.  Most small businesses operate ONLY on American soil so they don’t get these tax breaks.

President Obama plans on helping small businesses.

To level the playing field, Obama would bar firms from taking deductions for expenses that support their overseas investments until they pay U.S. taxes on the profits. He would also crack down on firms that overstate their foreign tax bills. And he would reverse a Clinton-era rule known as “check the box,” which permits firms to more easily transfer cash between countries. In practice, Obama officials said, “check the box” has been used to shift income away from higher-tax countries and into tax havens such as Bermuda and the Cayman Islands, allowing firms to reduce their tax bills both at home and abroad.

Those provisions would take effect in 2011 and would raise about $190 billion by the end of the next decade. In return, Obama proposes to make permanent an existing tax credit for companies that spend money on domestic research and development programs, worth about $75 billion over the next decade.

Then there are the “tax shelters”, the banks where the “rich” hide their money from the U.S. Government.  They shelter their wealth while you and I pay taxes and they don’t.

Obama also proposes to crack down on wealthy people who evade taxes through offshore bank accounts, primarily by targeting financial institutions in tax-haven jurisdictions. That plan, which would net another $9 billion over the next decade, appears to have few opponents.

All this money being denied to the U.S. Government.  No wonder the Republicans are yelling that the U.S. Government can’t provide health care for all Americans.   All this hidden money in taxes and all this avoidance of paying taxes leaves the Government funds short.

UPDATE:  About those “green jobs”

Now read the rest of this whiny fallacy….

Continue reading Corporate Crybabies – People vs Corporations _UPDATED

Financial Modernization Act of 1999

Senator Byron Dorgan (D-ND) was prescient when he gave this speech in the Senate on November 4, 1999 regarding the Gramm Leach Bliley Act.

Yes, Virginia, Senator Dorgan saw a light at the end of the tunnel and he knew a train was coming. He knew it wasn’t sunshine and that the passage of the Gramm Leach Bliley Act would eventually bring down our economy.

Part 1

(http://www.youtube.com/watch?v=OvnO_SH-4WU)

Part 2

(http://www.youtube.com/watch?v=veAOoQEy0PI)

Did you hear Senator Dorgan say “Too big to fail“? These words are so familiar to us. Unfortunately, Congress didn’t heed Senator Dorgan’s words. He predicted that we would be visiting the failures in 10 to 15 years as a result of passing the Gramm Leach Bliley Act and Congress didn’t listen.

(h/t to skymutt at Daily Kos)



Double Dipping

The nation is outraged at the insane bonuses given to AIG executives.  Yes, this is robbing the taxpayer.  There’s another part to this story.  It seems that the AIG failure is providing a second round of taxpayer money to the banks that caused this financial crisis.  According to an article in Slate, after they already received a payoff last year and now they want more.

…we need to go back to the very first decision to bail out AIG, made, we are told, by then-Treasury Secretary Henry Paulson, then-New York Fed official Timothy Geithner, Goldman Sachs CEO Lloyd Blankfein, and Fed Chairman Ben Bernanke last fall. Post-Lehman’s collapse, they feared a systemic failure could be triggered by AIG’s inability to pay the counterparties to all the sophisticated instruments AIG had sold. And who were AIG’s trading partners? No shock here: Goldman, Bank of America, Merrill Lynch, UBS, JPMorgan Chase, Morgan Stanley, Deutsche Bank, Barclays, and on it goes. So now we know for sure what we already surmised: The AIG bailout has been a way to hide an enormous second round of cash to the same group that had received TARP money already.

The bonuses are a way to distract the public while the real theft of our treasury is taking place, again.  Ah, laizze-faire economics as brought to you by Congress and the former Republican President, George W. Bush.

Read the complete Slate article here

Never trust your money with Republicans.  They will line their pockets first, tell you that they lost your money, then ask for more and then blame you for the losses.