Featured Quote

In 1913, Henry Ford wrote the following as the directors had been reaping the rewards of profits - "The wages we pay are too small in comparison with our profits. I think we should raise our minimum pay rate".

Tuesday, April 5, 2011

To Whom is it Not Clear?

The Republicans - fueled by the rapidly collapsing Tea Party - are plowing headlong into a Corporate Plutocracy.  With only the timid democrats standing in their... side view squeaking, "I'd rather you not do that."

Their Plan :
Tax cuts for wealthy corporations
Privatize Medicare and Medicaid - another windfall for corporations
  subsidize the private insurance payments, but probably not fully.
Spending cuts from programs that benefit working class citizens, women, poor elderly and children.

[edited to include more info on the Republican proposal]
"Under the Republican plan, the top marginal tax rate would be slashed from 35 to 25 ...percent, facilitating a dramatic transfer of wealth up the economic scale. Anyone making more than a $100,000 would pay the top rate; those under would pay 10 percent." - Huffington Post
"The plan also comes with some popular tax-cut proposals, including paring top rates for individuals and businesses to 25 percent from 35 percent." from Yahoo News
"It also calls for sharp cuts to Medicaid health care for the poor and disabled and to food aid for the poor." - from MSNBC
Even Libertarians see the hypocrisy in the proposal!

I read most of the proposal - Read the PDF for Yourself - and it is based on lies and distortions. They use terms that sound good to describe items that are nowhere near what the term defines. - Such as "end corporate welfare" - to mean no more bailouts instead of eliminating subsidies, tax breaks, loopholes and other such items.

All of the "repealing the Health Care Law" sections are just absurd.

"The problem with the corporate income tax is that corporations are not taxpayers – they are tax collectors. Taxes on corporate income are borne by shareholders, employees and customers. Investors pay the cost in diminished returns. Workers pay the cost in lower wages. And consumers pay the cost in higher prices."
Probably one of the biggest, boldest lies ever told.   The corporate income tax is a tax on income - after paying wages.  Higher wages MEAN a lower tax bill - because it cuts into the Profits that are what is taxed.  How stupid do Republicans think we are?? (Or, if they really believe this stuff, how stupid are they?) Consumers can not possibly pay the tax - because the tax is on profits - generated by the consumer buying their product/service. Investors... well, yeah, investors MAY get diminished returns, but I doubt it.  I think their returns are part of the write-offs on the taxes, but not positive.

In the aftermath of the Japan earthquake/tsunami/nuclear meltdown, Katrina and the BP Oil spill in the Gulf - they want to strip funding for the EPA, including funding for a tsunami warning system that just saved lives and property on the west coast.  There is zero logic in that stance - only ideology.  An ideology that has proven, over and over again, to be a disastrous failure.

They say : "President Reagan’s tax reforms inaugurated an era of great prosperity."
Which is a bald faced LIE. Reagan's policies have been DISASTROUS!  
 - see an EPI statement on the Plan -
[end edit and add section]

A book of short stories about the 80's recalls the reality of "Trickle Down."
In the 1980s, the Reagan administration claimed that tax breaks for corporations and the nation's highest earners would spur economic growth and allow wealth to "trickle-down" to those on the lower end of the economic scale. It was a lie, of course, and led only to the rich getting richer and the poor getting poorer at a dramatically increased rate. For anyone who graduated from high school, went to university, got married, and generally came of age in the United States in the 1980s, Cris Mazza's collection Trickle-Down Timeline will bring back memories which many of us have tried to forget. 
There is a great article that spells out how and why it is a failure at faireconomy.org
 It is true that growth increased drastically after the 1982 tax cut, reaching as high as 7.3% in 1984. However, as the Reagan-Bush, Sr. administrations went on and taxes for the rich were slashed even further, growth fell to negative levels during 1991, at the heart of the last recession. And, two of the three years with the highest growth were during the 1950s, when the top tax rate was 91%. Overall, there seems to be no close relationship between the top tax rate and the GDP growth rate, and statistical analysis backs this up: the correlation coefficient between the two variables is 0.03, meaning that there is essentially no connection. 
and
Overall, data from the past 50 years strongly refutes any arguments that cutting taxes for the richest Americans will improve the economic standing of the lower and middle classes or the nation as a whole. To be sure, the economic indicators examined in this report are dependent on a variety of factors, not just tax policy. However, what this study does show is that any attempt to stimulate economic growth by cutting taxes for the rich will do nothing -- it hasn't worked over the past 50 years, so why would it work in the future?
There are harsh (but not inaccurate) evaluations of the Republican enshrinement (and distortion) of Ronald Reagan.
So, if FDR was the revolutionary whose policies created a strong middle class for generations, Ronald Reagan was the counter-revolutionary whose attacks on those policies can be directly traced to the collapse of the American Dream
 The Charts on that site are stunning - and I've linked to the original source.  The biggest chart is the one showing how Republican policies transformed US from a Creditor nation, to the largest Debtor nation.  I combined two charts - The US International investment position chart and the GDP growth chart (the faint red line) below.  The sharp dip on the right was in 2003.  The Blue is millions of dollars of credit/deficit, the pink is the % of GDP of that credit/deficit.  Reagan reigned from 1981 to 1989.
[from wikipedia] The Tax Reform Act of 1986, another bipartisan effort championed by Reagan, reduced the top rate [from 50%] further to 28% while raising the bottom bracket from 11% to 15% and reducing the quantity of brackets to 4. Conversely, Congress passed and Reagan signed into law tax increases of some nature in every year from 1981 to 1987 to continue funding such government programs as TEFRA, Social Security, and the Deficit Reduction Act of 1984.  Despite the fact that TEFRA was the "largest peacetime tax increase in American history," Reagan is better known for his tax cuts and lower-taxes philosophy.
 Another prime example of stealing from the poor to give to the rich.

The republican agenda of giving tax cuts to the rich and corporations has been repeatedly shown to be detrimental to the national economy.

Even though the intervening Republican presidents added to the national debt, the biggest increase came under George W. Bush; the increase in total debt when he left office was larger than the accumulated debt of all the previous presidents combined. You have to go back many decades to find a Republican president who left office with a surplus.
President Clinton came into office with a deficit but left with a surplus of over $86 billion. History proves that the percentage of spending is consistently higher under Republicans and revenue is higher under Democratic leadership. In terms of job creation, Clinton created 23 million while G.W. Bush created 3 million, ironically, mostly in housing and finance. 
... and stuff like cutting state budgets so bad that people can't get to work absolutely infuriates me.

Finally, watch the first part of this Maddow show.
(and read - Taxes Matter )