THE U.S. ELECTRICAL GRID
Just about everyone knows that the U.S. has an electrical grid problem because of the media coverage of blackouts that seem to happen with regularity. But the reasons for the blackouts are complicated and the solutions are expensive. The primary problem is that electrical demand has exceeded the building of transmission lines by 25% per year, and the demand is expected to double over the next 20 years.
The power outages are costing us $49 billion a year. The cost of doing nothing is around $272 billion a year in unbudgeted emergency costs. The total cost to upgrade all of our infrastructure was estimated at $3 trillion in 2012 and $3.6 trillion in 2013, so every year we do nothing the total cost increases.
Repairing or replacing our infrastructure has the greatest multiplier effect, the most job creation, and the most economic impact compared to other types of spending. According to Moody's every dollar we spend on infrastructure boosts GDP by $1.59.
Infrastructure is not waste. In the context of competing globally, the supposed costs are quickly overshadowed by the benefits. The investment is going to pay off not just 5 to 19 years from now, but 30 or 40 years from now as well."
Wealth and Income Inequality and Solutions -- Part of the solution to all of these issues is the need for increased revenue. As stated above, governments need to be willing to impose modestly higher taxes when the situation warrants it. It is clear to me that it is warranted. It is also clear to me that the correct way out of any economic slowness is tax increases especially on the rich. In addition to income and wealth inequality being a moral issue and unfair, it will be ruinous to our country. People like the Koch Brothers who are worth perhaps $80B, and weren't responsible for the original creation of their wealth yet avoid paying their "fair share" in taxes. Today's four Walton families, worth about $140B, did nothing to initially create that wealth. What they do is figure out how to avoid taxes. There is much data that shows their lawyers help them avoid taxes including estate taxes. For example, at the Americans for Fair Taxes, http://www.americansfortaxfairness.org/tax-fairness-briefing-booklet/fact-sheet-the-estate-inheritance-tax/
" The Walton family -- which owns half of Walmart -- has exploited a loophole in the estate tax to avoid paying $3 billion in estate taxes. This could increase by tens of billions in the future.
" Casino magnate Sheldon Adelson has exploited a loophole that allowed him to pass $8 billion to family members and avoid $2.8 billion in estate taxes.
Also note that the total contributions from Jim Walton, Christy Walton, and the Walton family holding company (Walton Enterprises) to the Walton Family Foundation amount to $58.49 million, which is equivalent to:
" .04% of the four Walmart heirs' net worth.
" Less than one week's worth of the Walmart dividends the Walmart heirs will receive this year.
" Less than the estimated value of Rob Walton's collection of vintage sports cars.
We pay for food stamps for Walmart employees because they don't pay a living wage while last year the Waltons brought in about $8B to their fortunes. What did they do with that extra $8B?
Unfathomable compensation paid to the majority of our publicly traded Fortune 1000 executives is unconscionable. I already hear the arguments against these thoughts from free enterprisers. It's not only about what they take, it's what they spend like the Koch Brothers spending to control America through political contributions. The rich can impact the economy very little as they are not spenders and they clearly don't help anyone but themselves.
The problem rests on taxation where the highly compensated employees and very wealthy don't pay enough taxes. There are so many articles that show "Tax Cuts For The Poor And Middle Class -- Not The Rich -- Create Jobs" Yet, conservatives want the reverse. More money to the poor and middle class gets spent which drives the economy.
In an article, "Karl Marx was right -- at least about one thing" by Anatole Kaletsky, July 11, 2014, it said, "The most dangerous imbalance is in the distribution of wealth and income. Income disparities have become a source of political and moral controversy, but their macroeconomic effects have attracted less attention. The mechanism whereby income inequality causes economic stagnation was recognized by Karl Marx and other 19th-century writers. If too much of the income created by capitalism's capacity to increase production flows to people who are already rich and likely to save rather than spend, then crises of under-consumption become almost inevitable, as described by Marx in Das Kapital and analyzed more rigorously by John Maynard Keynes in the 1930s. The only way to avert such crises is to create financial systems that recycle excess incomes from rich savers to poorer consumers via a buildup of debt."
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