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Historian

La Fayette, KY

#21 Jun 18, 2013
No. 21

The basic premise of supply-side economics is that lowering taxes on the rich will actually increase tax revenue and stimulate the economy by increasing the amount of money available for investments in job-creating industries. In the business model operating in the 1950s, this would probably have held true. In the 1950s, American corporations were plowing a large percentage of their profits back into new productive plant and equipment. Railroads were replacing their fleet of steam locomotives with diesels and laying new track to replace what had been worn out during the Depression and World War II. Other industries were replacing equipment that they had not been able to upgrade since the 1920s, and doing this at a time when profits were steady, but not especially high. A reduction in taxes would have left them with more cash to invest. This is not the situation today, however. Today, America’s corporate profits are higher than they have ever been, and taxes are considerably less than what they were in 1950. Corporations are sitting on a mountain of cash, but they are not investing it in new plant and hiring people to operate it. Instead they have developed a business model that is predicated on moving production overseas, some to Mexico, Brazil, and Eastern Europe, but mostly to Asia, where they can pay labor poverty wages, impose working conditions that would not be tolerated in the Western world, where there are little or no health, safety, and environmental laws, and where they are protected from both labor unionism and legal liability by authoritarian governments. The cheap foreign made goods are then brought into the United States and sold to American consumers through huge monopolistic retailers like Wal-Mart. The profits generated further inflate the accumulation of wealth in the hands of the richest few, who then invest it in ever more elaborate huge-profit-fast speculative schemes, not in productive industry.
Historian

La Fayette, KY

#22 Jun 18, 2013
No. 22

In the 1950s the economy boomed, jobs were created, and the World War II debt was paid off with startling speed. How come? The answer lies in the fact that after World War II, tax rates on the wealthy were much higher than today. This redistributed wealth throughout the economy by building roads, bridges, schools, etc. All that building required a tremendous amount of labor and material, and that material was produced by and purchased from private suppliers, many of them small businesses. In the 1950s, the top 30 percent of Americans owned about 40 percent of the total wealth, while the bottom 70 percent owned 60 percent of the wealth. People lower down the economic ladder had good jobs that paid well, and the wage earners spent the money, thus stimulating production of consumer goods, housing, etc, fueling economic growth. The post World War II economy boomed because the great majority of people had money to spend, and it is lower income people, not the rich, who buy the vast majority of all consumer goods. This was very unlike today, when the rich have far more money than they can spend on goods, while everybody else has too little.

Unless something is done to rectify the situation, our economy is headed for a catastrophe like nothing that has ever happened before, not a crash, but The Crash, because we are dangerously close to the terminal stage of laissez-faire capitalism in which so much of the wealth has accumulated in the hands of a wealthy few that there is not enough left in the hands of the great majority to sustain the economic engine.

There are no easy nor simple ways to solve the problem, however. If The Crash is to be prevented, a complex set of remedies must be employed. They include re-imposing strenuous regulations on banking and business to prevent repetition of the shenanigans that led to the crash of 2008, break up the concentrations of corporate wealth the same way that Theodore Roosevelt broke up the Trusts, and, most importantly, raise taxes on the richest 20 percent (with rates rising sharply as income increases) of Americans high enough to pay off the debt while at the same time keeping government spending at levels sufficient to redistribute the unhealthy concentration of wealth.
Historian

La Fayette, KY

#23 Jun 18, 2013
No. 23

One remedy that should not be tried is the so-called “Flat Tax.” A flat tax will in fact make the situation worse. That is because if the percentage rate is high enough to extract enough money from the rich to cover the costs of infrastructure and an adequate level of government services such as education, it will be too high for the great majority wage earners to pay. Every flat tax scenario that I have seen has the effect of being either a tax increase for wage earners and a tax cut for the wealthy or raises too little revenue to maintain essential services.

Statistics like the ones that I cited above do not seem to alter the thinking of many in the Tea Party’s rank and file, because for these people, their economic ideology has become their religious belief—literally. Spending cuts and low taxation of the rich, as the Tea Party advocates, no matter how painfully drastic the cuts, will not solve the problem. If we do not raise taxes on the rich and spend the money so as to redistribute the wealth in such a way as to stimulate our next stage of economic development, the economic engine of capitalism will be starved, the middle class will shrink drastically, the majority of Americans’ standard of living will fall to that found in a Third World country, and the United States will become a plutocracy ruled by a tiny oligarchy of the super-rich.
Historian

Kuttawa, KY

#24 Jun 21, 2013
An interesting article worth reading:

http://opinionator.blogs.nytimes.com/2013/06/...
Big Ben

Richmond, KY

#25 Jun 21, 2013
Interesting and have read much of this before, agree with all of it but you have to know you are above the education level of most people that visit this site. They don't know, they don't care and the education system keeps the status quo around here.
All the above is maintained by a strong Wall Street and corporate lobby. Supreme court recently made all this permanent by making a corporation the same as a person as far as campaign contributions go. The super rich not only own 85% of the wealth, they own the government.
Even if everybody understood what you just wrote it matters not for the very government of the people, for the people and by the people is now for the corporation, of the corporation and ruled by the international corporations and bankers.

You are 30 years to late to educate everybody on what went on, true lobby reform and term limits 30 years ago may have fixed the problem but now it is just to late. Go watch a UK game, the Voice, American Idol, a reality show and numb your brain like the rest of the stupid sheep.
Big Ben

Richmond, KY

#26 Jun 21, 2013
Historian wrote:
No. 23
the economic engine of capitalism will be starved, the middle class will shrink drastically, the majority of Americans’ standard of living will fall to that found in a Third World country, and the United States will become a plutocracy ruled by a tiny oligarchy of the super-rich.
To Late history boy, they have already wiped out the working and middle class. We will soon be a third world country with a few nukes. International corporations and International bankers have no allegiance to this country or really needs this country for their wealth. They have cheap labor abroad with no cost for health care or retirements and they have a market for their goods and services. Jefferson warned of this day, just because it has an iconic American name if it trades or does banking abroad they are not loyal to this country, the dollar, the constitution or the people of this country. The fox is in the hen house, no turning back. The Central Bank for the elite and powerful rich has materialized as Jefferson feared, so did Jackson. The all powerful Federal Reserve is the lacky of Wall Street, created for Wall Street and owned by Wall Street.
To late to put the draw bars up after the cow is out, the government is owned by the Wall Street bankers and corporations. Until you get that in your head you are just peeing in the wind. They even got the supreme court to rule in their favor in order to keep it this way. You got educated about 30 years to late to matter.
dunadd

Greensboro, NC

#27 Jun 21, 2013
Don't blame all this on the rich even though there are rich involved. It has to do with NATIONAL SOCIALISM!! not yelling, emphasizing. You have the correct words but just misplaced. You state the government is owned by the Wall Street bankers and corporations. In fact, Wall Street, bankers and corporations are owned by the NATIONAL SOCIALIST government, again not shouting but emphasizing. Who bailed out GM getting control of the company and then turning it over to the unions? if you answered the NATIONAL SOCIALIST, not shouting but emphasis, government you answered correctly. If it barks, it's a dog. If it practices NATIONAL SOCIALISM, emphasis, it's NATIONAL SOCIALIST! Jeez, that was hard to figure out, wasn't it?
Big Ben

Richmond, KY

#28 Jun 21, 2013
dunadd wrote:
Don't blame all this on the rich even though there are rich involved. It has to do with NATIONAL SOCIALISM!! not yelling, emphasizing. You have the correct words but just misplaced. You state the government is owned by the Wall Street bankers and corporations. In fact, Wall Street, bankers and corporations are owned by the NATIONAL SOCIALIST government, again not shouting but emphasizing. Who bailed out GM getting control of the company and then turning it over to the unions? if you answered the NATIONAL SOCIALIST, not shouting but emphasis, government you answered correctly. If it barks, it's a dog. If it practices NATIONAL SOCIALISM, emphasis, it's NATIONAL SOCIALIST! Jeez, that was hard to figure out, wasn't it?
GM corporate is an international corporation, took 70% of that bailout money to communist China. Yes they own large blocks of major news media and they own several high place congressmen. They got the sweetheart deal, cheap money guaranteed by the American tax payer. Took bankruptcy and dumped their health care and retirement cost. How do you think they got the deal they got? Major contributor to the campaigns of the people that voted them in the low cost bailout loan with no provision not to take the money to Communist China.

Not shouting but wake up and smell the coffee. We have the best government money can buy, bought and paid for! Yes they use socialism to bail capitalism out when they get in trouble. A socialistic government is not about social welfare for corporations unless the corporations own the governing socialist parties. They voted themselves 800 billion TARP funds and then a 3.2 trillion dollar .0003% loan for Wall Street and kept that last one hid for 3 years. The Fed pumps 85 Billion a month into the bond market to keep it afloat and you don't see anybody yelling socialism about that. You have to own the government in order for it to vote socialist deals for corporations for socialism has never been for the corporations but for the people....
You may need to redefine the term socialism!
opinion in my history

Kimper, KY

#29 Jun 21, 2013
I ve never had a pocket full of money and that means broke!!
Historian

Princeton, KY

#30 Jun 21, 2013
What is happening in the U.S. is NOT national (state) socialism or socialism of any other kind. It in fact is the very antithesis of socialism. What is happening in the U.S. is plutocracy, a situation in which the wealthy few co-opt and take over the government and use it to support and sustain a monopolistic capitalism. The ultimate goal of plutocracy is to reduce the great mass of the people to a modern version of serfdom or peonage (debt slavery).
old dude

Pikeville, KY

#31 Jun 21, 2013
Historian wrote:
What is happening in the U.S. is NOT national (state) socialism or socialism of any other kind. It in fact is the very antithesis of socialism. What is happening in the U.S. is plutocracy, a situation in which the wealthy few co-opt and take over the government and use it to support and sustain a monopolistic capitalism. The ultimate goal of plutocracy is to reduce the great mass of the people to a modern version of serfdom or peonage (debt slavery).
Let me sum it all up for you Historian; Blacks and liberal elitists voted in a black SOCIALIST .There is NO FREE MARKET in America. Ben Bernanke and the FED are trying to find the "perfect interest rate" that would result in EVERYBODY "WINNING".....Ain't gonna happen and the black impostor in chief is going off on a "global warming" crusade instead of doing his job. His Obamacare is STIFLING business,his spending policies are drowning the country in insurmountable debt and this country has already fallen to third world status..,...
Big Ben

Richmond, KY

#32 Jun 21, 2013
Wall Street spent billions to elect obummer the the first time and than spent billions on Romney's campaign. the horse the chose was such a loser the money never mattered this time. However they still bought the house of representatives as a hedge.

Wall Street so called banks and corporations run the whole shooting match through lobbyist and the no election spending rules, no term limits. The Fed is not a government institution, most think it is. The above through the inflation/deflation cycle comes in every now and then and causes a market crash and then buys up everything of value for pennies on the dollar. Just as Jefferson said, " they will own your very homes". When they instituted the Federal reserve they set up the Federal Income Tax to ensure that American tax payer would fund it, either directly or indirectly.
All international banking is connected and all the central banks are connected and the main Federal Reserve bank is in Switzerland. The U.S. is not a true Madison Style Representative Democracy now. The shots are called by international bankers "Wall Street banks" the Federal Reserve. The to big to fail are 10 times larger now than when the Fed bailed them out. The Fed has been keeping the market artificially high since 09. The quantitative easing is about over, the sugar tit is being pulled, the chumps are about to be flushed and the top 1% will as in the great depression buy up the rest of the country for pennies on the dollar. The largest default in history and the total control of the U.S. wealth, production, consumption and institutions is just around the corner. The rich have become 20 fold richer in the last 20 years and are about to take in the last 15% they do not control..

Wait for it!
God

New Albany, IN

#33 Jun 21, 2013
Obama's campaign: Class warfare. Eat the Rich.

Romney's campaign: Put America first. Fix the job market and economy. Help the job creators grow their businesses, and the middle class will benefit.

Well guess what? Americans decided they would rather have welfare than a good paying job.

Losers.

CNN is reporting that Obama's approval ratings are lower than ever before, and George W. Bush's approval ratings are higher than ever before.

Isn't that funny? Obama was constantly blaming Bush for all of the problems Obama himself created. And now Americans have decided that they would rather have Bush as president again than another day of Obama.

LOL.
JOHN JOHN

Pikeville, KY

#34 Jun 22, 2013
God wrote:
Obama's campaign: Class warfare. Eat the Rich.
Romney's campaign: Put America first. Fix the job market and economy. Help the job creators grow their businesses, and the middle class will benefit.
Well guess what? Americans decided they would rather have welfare than a good paying job.
Losers.
CNN is reporting that Obama's approval ratings are lower than ever before, and George W. Bush's approval ratings are higher than ever before.
Isn't that funny? Obama was constantly blaming Bush for all of the problems Obama himself created. And now Americans have decided that they would rather have Bush as president again than another day of Obama.
LOL.
Bill Clinton busts both put together so whats your point.
so what

Richmond, KY

#35 Jun 22, 2013
I just had a hard poop.
JOHN JOHN

Pikeville, KY

#36 Jun 22, 2013
Yes Big Ben you were right. These idiots couldn't understand what historian wrote if it was done in crayon. It doesn't matter who is president money will always win out in the end. A government bought by the lobby.
dunadd

Greensboro, NC

#37 Jun 22, 2013
government is the lobby. Federal government is big business. According to some, National Socialists can't be plutarchs. Russian plutarchs. You got it, the Kremlin. Chinese plutarchs, yes, the Golden Palace. Vietnamese plutarchs, Ha Noi government. German plutarchs, Berlin government, the list goes on and on. Wow, that was a no brainer. What we are witnessing in DC is the creation of NATIONAL SOCIALIST plutarchy. Classic example of NATIONAL SOCIALIST plutarchy-Gazprom!

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