Keep calm and carry on?
By Raymond Freeman 06/26/2014
Nobel-prizewinning economists Joseph Stiglitz and Paul Krugman believe America’s main problem is its inequality, as do “rock-star economist” (!) Thomas Piketty as well as economics professor Robert Reich. On Jon Stewart’s Daily Show Mr. Reich stressed that America’s main problem is its extreme income inequality, not national debt. What’s the issue?
The middle classes aren’t spending enough to keep the economy humming. The money that they used to spend has been grabbed by the super-rich and stashed offshore. This money doesn’t create new jobs or pay workers better, expanding the economy. Henry Ford said the real economy-expander is you. “The employer does not create the jobs. He only handles the money. The product makes the money.” That is, when sold; mass production depends on mass consumption. When you spend money, you “create the jobs.” But right now you aren’t creating enough jobs … because you aren’t spending enough money … because you aren’t paid enough … because the pie is cut so unequally. Inequality directly affects the economy since the super-rich can’t spend enough. Mitt Romney doesn’t own 12,000 Cadillacs. He has 12, say. The other 11,988 didn’t get made, increasing unemployment.
Reich was optimistic. He believes we’re getting to a “tipping point” when we’ll realize that Republicans are robbing us blind and throttling the economy. We’ll then do something about it. He quoted Winston Churchill: “Americans will always do the right thing, after first exhausting all other possibilities.” We adorable Yanks muddle through cluelessly, but somehow get it right in the end!
So, can we simply keep calm and carry on?
Churchill said that about Americans in 1945 looking back on WWII. Much has changed. We’ve seen a war that the British thought unwinnable (Vietnam), a failed colonial war (Iraq) and a mindless, endless war (Afghanistan). We’ve seen the theft of a presidential election rubber-stamped by the Supreme Court. We’ve seen that atrocious court unleash torrents of dark money as “free speech.” We’ve seen democracy replaced by oligarchy (rule by the elite few). Here’s a newsflash: Policy decisions since 1975 have been driven by what’s best for the top 1 percent.
America today is a long way from what Churchill knew. Ronald Reagan abolished facts. Republican House Speaker Newt Gingrich abolished decency. His antics destroyed the moderation necessary to make America’s awkward constitution work. We’ve seen President Obama vilified for enacting conservatives’ own health-care policy. And we saw Republicans blatantly obstructing the recovery from the 2008 economic crash that their own policies caused and then being rewarded politically, retaking the House in 2010. Go figure that one.
I don’t see all this as “doing the right thing,” ultimately. I see it as doing the wrong thing, consistently worsening. Yes, America’s done some “right things,” such as with civil rights, but the record overall is dismal. Churchill would be appalled. Regarding Reagan’s “trickle-down economics,” the greatest rip-off in world history, he’d say, “Never in the field of economic production was so much stolen from so many by so few.”
He’d agree with the comparison, by the conservative Wall Street Journal, of the Tea Party to kamikaze pilots. We saw their madness in the government shutdown, estimated by Moody’s Analytics to have cost $31 billion. We saw it in the refusal by 24 Republican governors of billions of dollars for the expansion of Medicaid to help 6 million citizens. We’ve seen 51 bills from House Republicans to abolish Obamacare. (Please stop laughing.)
And we saw a sorry example with New Jersey Gov. Chris Christie, our “traffic study” expert [irony alert]. There’s acute railroad congestion in New York and New Jersey. This clogs traffic at the port, creating inefficiency. Goods are held up. Obama offered Christie the funds to build a sorely needed tunnel almost for free. He refused. He didn’t want to accept money from the hated Obama and then lose (as Eric Cantor did) to a “kamikaze pilot” at the next election. This infrastructure investment would have: (a) created jobs and increased GDP; (b) not affected debt/GDP ratio (both go up by the same amount); (c) cost New Jersey almost nothing; (d) made the private sector more efficient. By every cost/benefit analysis it was a winner. Christie couldn’t have cared less.
So did the liberal media hammer Christie? Dream on. What “liberal media”? NBC’s Political Director Chuck Todd said right out that it’s not his job to inform viewers even when Republicans blatantly lie! Why? NBC is owned by General Electric, a corporation controlled by Republicans. Corporations don’t serve truth. They serve money. “No man can serve two masters” (Matthew 6:24).
With all due respect to Professor Reich, Americans won’t eventually do the right thing. But remember, Pope Francis attacks inequality. So … get angry and do something! Ask Republican candidates: “What are you going to do about America’s No. 1 economic problem?”