The Corporatist/GOP Echo Chamber on Tax Cuts
NOTE: Several people have suggested that the term Neocon in the original title was inappropriate nomenclature for the Teaparty crowd that is doing a hatchet job to the U.S. budget. After some research, I have concluded they are correct. I still cannot bring myself to use the term "rightwing" because there is nothing right about what those who attack the very fundamentals of our democracy are doing. Therefore, I have opted for "Corporatist/GOP" to describe the current regime that is trying to undermine our democracy by defunding it.
The narrative on tax cuts goes something like this: "You don't want to raise taxes on the job creators during a recession." This is a powerful argument. Unfortunately, it is a dishonest argument. It is just as disingenuous as its corollary, "I've never seen a poor person hire anyone." What if everything you thought you knew proved to be false? George Orwell wrote a book about this scenario called 1984. Today, we find ourselves living in that Orwellian world of Big Brother. The only one difference between Orwell's 1984 and America's 2011. Big Brother is the plutocracy instead of the government.
Demand creates jobs, not taxcuts. Look at the evidence. During the Eisenhower administration the tax rate on incomes over $300,000 was 91%. The nation was prospering. Middle class families were able to find jobs and buy new homes. Workers were protected by unions. Incomes and the standard of living were rising. Kennedy cut taxes on the wealthiest Americans in 1963 to 77%. Reagan cut taxes on the wealthiest Americans to 50% in 1982 and to 38.5% in 1987. Bush cut taxes on the wealthiest Americans in 2003 to 35%. If tax cuts created jobs, the Bush administration would have ended with the fullest American employment in history. Instead, by 2008, America experienced the most severe economic crisis since the Great Depression.
FIX America! by PLAN America
In an upcoming book from the Progressive Leadership Action Network (PLAN) entitled FIX America!How Each of Us Can Help All of Us., I explain how speculation, not the Community Rehabilitation Act of 1977, caused the Republican Depression of 2008. When government gives tax cuts to wealthy people, they look for ways to maximize profits. The wealthy already have plenty of material possessions. There are only so many cars and homes a wealthy family can use. Even John McCain needs only 9 houses. Giving him a tax cut does not mean that he will buy house number 10. Wealthy people want more return on investment, not more material possessions.
Neocons want you to believe that the wealthy will plow this new-found cash from tax cuts into creating jobs. There is a major problem with this theory. Creating jobs when there is no demand will reduce profits, not maximize them. Creating jobs when there is no demand creates excess inventory. Excess inventory leads to lower prices and higher costs from additional warehousing expenses. Lower prices and higher costs means lower profits. This is not rocket science.
Where do wealthy people park their excess capital when there is little or no demand for increased production? They turn to the Wall Street. Wall Street is a giant gambling casino. When there is no demand for additional production, investment bankers on Wall Street use this excess capital to create bubbles. Bubbles are the illusion of value. For 28 years between 1980 and 2008, Wall Street performed a very entertaining magic act. Wall Street's investment bankers, using smoke and mirrors and slight of hand were able to create bubble after bubble to amuse and entertain America. Just like Las Vegas, Wall Street provided these wealthy gamblers a seat at the table. Like all casino gamblers, instead of paying their bills, these wealthy gamblers bet on one bubble after another. After all, they could simply ask the rest of us to pay their bills for them. That is, they continued betting until they September 18, 2008 when the bubble burst and they lost all their money. Then the wealthy gamblers asked the rest of us to take out a loan on our children's income so they could get their money back.
Wealthy Americans need the rest of to work harder for less money so they will have more money to gamble with. That is why the Koch Brothers, David and Charles, and their friends are spending millions of our dollars to help people like Scott Walker in Wisconsin and John Kasich in Ohio get elected. Scott Walker and John Kasich promised to make the rest of us work harder to that the Koch Brothers could get more tax breaks. The Koch Brothers and their friends need more money to gamble with. Unfortunately, the less money we earn, the less money we have to go shopping or spend on repairing our homes. Less shopping and spending means less demand. Less demand means less production and less production means less jobs. It may start to become apparent that tax cuts do not create jobs. In fact, tax cuts cost jobs.
If it is apparent that tax cuts cost jobs, why do so many people believe that tax cuts create jobs? This is work of the neocon echo chamber. It is often referred to as the rightwing echo chamber, but that is a misnomer. It is a misnomer because neocons are doing the wrong things, not the right ones.
The neocon echo chamber is led by Rupert Murdoch and the FOX Network. Murdoch also owns the Wall Street Journal. Now he can deceive more people. FOX is able to persuade other networks that used to broadcast news to broadcast the deceptions he creates instead. Networks like CNN don't have to pay journalists to investigate current events to find out what is really happening. It is cheaper to repeat the deceptive stories that people on the FOX are making up. Besides, the people who own CNN are wealthy gamblers too. The Republican party is happy that FOX is deceiving lots of people. That makes it easier for Republicans to convince the rest of us that Republicans can create jobs by cutting taxes. So, when the FOX makes up a new deceptive story, like "You don't want to raise taxes on the job creators during a recession," Republicans repeat it over and over. If everyone tells the same story, the rest of us can be made to believe it.
That is why it is called an echo chamber. Now you the whole story about deception from the neocon echo chamber on tax cuts. Now you also know why over a hundred thousand workers are marching in Wisconsin.
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