The first casualty of war is truth, they say. The first casualty of debt is the poor and middle classes, and that is a truth that's just becoming visible. The current European crisis is forcing us to look at our unspoken and unexamined assumptions, and it's not pretty. The uniform response to unrepayable debt, in Greece and Italy, is a reduction in the government activities that created and support the middle class. There is no real alternative being pursued, and no grand debate forcing a society to choose and define itself. There's one idea and one idea only: Austerity, and a reduction in public expenditures, pensions, programs.
Put aside your feelings about "austerity" for a moment, put aside the intuitive sense that it isn't fair and isn't necessary, and let's examine the argument.
These European nations, and the U.S., have spent money well beyond what they bring in. It is an unchecked, permanent debt spiral, with no prospect of repayment without a convulsive set of changes. The lenders, mostly large banks, will shortly stop lending out of fear they won't be repaid. These governments will then default and economies will stall or collapse. Rather than let that happen, the wealthier economies are willing to pour money into the failing economies, but only if they adopt austerity measures, reduce government spending and reduce government participation in the economy. Pensions are slashed, programs dismantled, retirement ages raised, public assets sold off and the objective quality of life of most citizens is reduced.
If one wishes to reject "austerity" or... what? There's hardly a leaf stirring in that forest. And logically there's only one place to go. Assume that we agree that an economy cannot permanently spend more than it brings in, which seems a fair assumption. If life-changing cuts in spending are unacceptable, all that's left is raising revenues. Tax increases. In some societies that's theoretically easy. In Greece massive public tax evasion has crippled the ability of government and society to function. If people would just pay what they now owe, problem solved. But in Ireland, or Portugal or Italy it's not so easy. There, and in the U.S., only an increase in taxes will provide an alternative to massive public sector reductions.
There's a real argument to be had here, and genuine dangers in either austerity or tax increases. But the world is frozen in a political climate that has made tax increases illegitimate and impossible, so impossible that they are not really discussed and on the table. Is any political system actually grappling with questions like, "What is the proper amount of money government can take out of the private sector? Will tax increases stall or kill economic growth? Which taxpayers should shoulder a greater tax burden? What are the real-life consequences of massive reductions in public activity?" I don't see those questions debated anywhere, certainly not in Europe. Some left-wing politicians and unions protest against austerity, but are shrugged off as special interests protecting their privileges, while the "grown ups" stream down the austerity road like lemmings.
Like each of us, I have my own answers. But there's no way any of us can assert that we've found the right answer. I'm miles away from insisting that I've got that answer. I just want a real debate, a real opportunity to choose one model or the other. And the failure to engage in that debate will produce not just an economic debacle, and a change in the relationship between people, and between people and society, it endangers the idea that democracies can solve difficult choices and that elections are the place where we make these decisions. (A referendum of the people in Greece to decide on austerity?? Horrors!!)
Permanent income and social inequality, permanent economic stagnation, low birth rates, declining quality of daily life, this isn't the inevitable death spiral of a once ascendant culture. These are the explicit policies chosen by leaders of that same culture.
The only glimmer on the horizon is, by the way, Occupy Wall Street. It is a bit unfocused, at least on a political or economic agenda, and it certainly needs to choose a path more quickly than it wants. But its strength is in its initial premise: The world is being operated in the interest of the top 1% of society, and that's not right, it's not effective, it's not fair. That resonates, that can be picked up by political leadership and translated into policy, like Franklin Roosevelt did. I'm not being nostalgic. I'm being realistic about where we stand today, as citizens of a global economy. We're closer to the edge than we think.
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So much for transparency and ethical conduct.
We have a population edging nearer to uniform obesity daily which is exacerbating the health care problem. We are spending billions to incarcerate people whose only crime is getting high on illegal rather than legal substances. We have the shortest school year in the developed world while allowing any child who wishes to drop out at sixteen with no skills.
For decades the government has funded dysfunctional and conflicting outcomes. America is on the road to the absolute necessity for austerity unless we start applying common sense to the use of taxpayers' money.
Richard Brodsky
Brief example:
It is pretty well acknowledged by all political ideologies that well educated people, no matter their income bracket, tend to be healthier, live longer and make better lifestyle choices. Since entitlements are what are eating up our budget, it only makes sense to focus on education as a major driver of a solution to our deficit.
So why is Washington fixating on either cutting entitlements or raising taxes? If average voters don't understand why you need to do either and where the savings will go of course they aren't going to agree with the opposing party.
If we set a goal of educating every single child in America so that none dropped out and all graduated from high school, technical school or a university job-ready and gave it the same importance as the race to the moon we would turn around our economy in a decade.
for the top 10% http://bit.ly/fa3K6T approx. 1/7th of all Americans,
or rescind the Bush Tax Cuts for all of us.
Set aside SS, Medicare, and Medicaid, worries,
so we, the people, can DEAL WITH THE REAL ISSUES.
http://bit.ly/uVqmHB
Public Campaign Financing
http://bit.ly/uwtWuR
Term limits - limit two 2-year House terms, limit one 4 year Senate term
Progression - only after serving 2 House terms, eligible for one Senate term
transparency in all actions
http://bit.ly/jnfQMr
I agree.
The oligarchs do not get it.
By impoverishing too many in the lower classes, they are bringing about social and political unrest.
This is NOT the 1930's where lower class people more or less accepted their fate.
All they had were oligarch owned newspapers, movies, and radio.
It was easy then to control the people.
News now travels around the world in the blink of an eye....with plenty of commentary.
The ordinary people are NOT so easy to control, especially when they have had their fill.
Either the oligarchs and politicians do something for the lower and middle classes and share....or the whole comfortable country they are used to is going to explode.
There is only so much ordinary working Americans are going to take BEFORE they do something about it.
The oligarchs and politicians should want to take care of the lower classes just for their OWN self preservation.
{shrugs}
Of course, the Repugs want to sell you a hill of beans....how the rich pay so much and the military budget can not be cut by one penny.....yada, yada, yada.....
If we keep up with the trickle down theory of economics and spending on wars....then do not be surprised if the American economy self-destructs with a worse economic meltdown than in 2008.
The eurozone is falling apart.....one country at a time....though it is being propped up for now.
How long can that last with the lower classes suffering while the upper classes do not?
At the same time austerity (rather than creating more jobs so people can pay taxes and buy things) is making things worse?
There are two types of government spending just like in any household. There is spending for operating costs and there is spending for investment. We need to reduce our operating expenses and transfer more money to investment. We cut some government jobs and create new offsetting jobs through investment. It is blindingly obvious and relatively simple. The place to cut with the least impact on the economy is defense spending. Cuts in defense spending will hurt the Iraqi and Afghan economies far more than the US economy.
The one thing government can do is take risk where private investors won't.
People with good jobs pay more taxes and buy things and stimulate the economy.
*****They are also happier and less likely to complain or riot.
By impoverishing more and more Americans, the politicians and oligarchs are doing the opposite of what could work.
Greece, from what we've now found out, was never in a position to financially handle such a debt load, and that was made even clearer through their efforts to hide the true amount of debt that they were carrying.
The only thing that Europe can teach us, as far as I'm concerned, is that the government needs to find a way effectively manage the cost of the promises that were made to our citizenry and do everything, within their power, to ensure the soundness of our budget.
Reforming the entitlement programs, going forward, is something that needs to be done. Social Security and Medicare need to be fixed, to deal with the current reality. Medicare Part D needs to be scrapped entirely, with the cost of providing discounts for prescription drug coverage, if it is determined that that is something that needs to be done, represented in Medicare, proper.
The entitlements are only part of the issue, but failing to deal with these issues will leave us in Greece's very situation.
Greece built up a federal pension system, with no true plan to ever manage paying for it, and it's now blown up in their faces, with the entire fate of the EU, the only economic collective that rivals the US economy, hanging in the balance.
If your heart is set of building out a massive pension program that has, to be modest, trick finances, at least have the decency to present a plausible way of paying for it, if not just managing the costs of it.
Every person who jumps into any conversation about fiscal budgets with the idea that the entitlement programs, in a meaningful way, ought not be part of the fix, as far as I'm concerned, is being outright foolish.
Do you ever actually read your own writing, claiming to be a "presidential candidate" while also calling for a national sales tax in the range of 10%-15%? Now, your proposal may sound just goofy, when being considered in states with no sales taxes, but in California, my home state, the sales tax is already at ~9.7%, once you count the state/county/local/bond taxes that apply.
Without a hint of sarcasm, from what I can tell, you are pushing for a, entirely hypothetical, ~20%-25% total tax burden, on anything that a person bought with the intent to 'use'. Absolutely ludicrous.
I've proposed this simple part of the fix on countless posts, and I've yet to see a single person, coming from what i assume is your perspective, discredit this idea with any substance, so I'll give you a shot:
-Raise the income cap on payroll taxes, from wherever it is to $250,000, adjust the payout formula accordingly.
-If you receive SS benefits, you are restricted to supplementing the benefit with a part-time job (20 hours per week/ 110 hours per year), but your benefits are non-taxable. Going over the allotment results in penalties being drawn from forthcoming checks.
-If you decide to not draw SS benefits, or are means-tested out of receiving full benefits, you will receive a tax credit, worth 44% (for the 44th President, :]) of what your benefit would've been, with all income/earnings taxed at whatever rate is current, with no work restrictions.
What would be wrong with such a proposal?
In Mexico in the mid-'90s Wall Street engineered a currency coup that tripled the debt owed by small businesses and family farms and also allowed for them to be massively ratejacked on top of it. Mexicans consequentÂÂly formed the "el Barzon" movement and pushed back Wall Street and deposed their ruling party of 60+ years. In this country YouTube phenom Ann Minch declared the debtors' revolt and began going after them, with others joining in.
If you've been pushed under, you can read every other page of my book for free: http://wwwÂÂ.scribd.cÂoÂm/doc/25Â44Â3175/DeÂbt-ÂHope-DÂown-Âand-DÂirty-ÂSurvÂival-SÂtraÂtegies-ÂEvÂaluationÂ-ÂVersion-CÂÂomplete
Break up the banks. The moneychangers have become overlords over the 99%.
Its the big lie that if they say over and over again that revenues can't be a solution, it must be true.
Forget that history shows that America went through a great wave of prosperity from the end of World War II until the 1970s and taxes were well over the levels they are now and all levels of the economic ladder had shared growth and the country was stronger for it.
You are following a failed philosophy of socio-economic projection that is better described as "survival of the fittest".
Survival of the fittests only really works well for those who already HAVE. Let's see who already has shall we ?................uhmmm.........
OLD FAT BALD WHITE MEN who own EVERYTHING and make up the vast majority of the 1%.
You think you're part and partial to their plans. You're not. You're not in the club. You're not invited, not even to walk through the back door and take out their trash. You are a peon, a peasant. Your voice your vote your opinion mean nothing to them. You are a slave yet to be to them. And yet because of your false sense of connection you merrily support your would be masters out of ignorance and self punishment.
You are in a small shrinking group of misinformed misguided racist groups who use economics to try and force a social order. It wont work. It's never worked. And you should reevaluate your relationship with your perceived club. The love you'll find one way.
Deregulation and the lack of enforcement of existing laws has helped bring us to near economic collapse.
We The People ! Viva La Liberte !!
However, assuming the top 1% are diligently saving a proportion of the substantial amounts of money they ... ahem ... earn, surely they would be in a better position to handle a sudden increase in their outgoings.
They didn't respond to the carrot, so it is high time they get the stick.