As Gen X will remember, back around 1991, 1992 we were told that we would be the first American generation to NOT do better or even as well as our parents।
For years we wondered just why this was. We asked ourselves, can this be true? How can this have happened? Especially after the messiah Ronald Reagan came in and saved us all. Or did he?
The main reason behind the holding back of achieving the reality of the American dream and offered a watered down, debt ridden version of it is because of Conservative/Republican economic policies, because we have replaced old fashioned "demand side" economics that was the way this country was run for over 200 years and arguably goes back thousands of years.
Demand side economics basically is the idea that there are people out there that want to buy things, gee, I think I'll start a business to sell to them. With "supply side" economics, an invention that came to life during the Reagan adminsitration basically says, let's take the public's money and give it to wealthy people and hopefully they'll build more factories, and they'll get even more wealthy, and in the process of them buying yachts, they'll build factories that will create new jobs buidling yachts, and when they buy more Gulf Stream airplanes, Gulf Stream will create new jobs building Gulf Stream airplanes and hopefully they'll build more factories making more things that we'll want to buy.
THIS HAS BEEN A DISASTER!! IT DOESN'T WORK!!
The traditional concept of economics is people buy things because they have the money to buy them. What drives an economy is demand and the demand comes in part because people have the means to fulfill that demand. In other words they're making enough money to buy things.
There were really two pieces to Reaganomics, the first part basically said, we're going to forget about whether or not people can afford to buy things, we're going to tax working people, literally doubled the tax on the middle class and put in huge tax breaks (it went from 70% to 28% on people making over 3.2 million dollars per year) on the very wealthy and on corporations. Before Reagan came into office major corporations were paying 35% of all infastructure like police and fire that yes, even corporations use. Because of that we are now down to around 7 or 8% of our taxes in the United States are paid by corporations, the rest are paid by individual taxpayers, you know, you and me. There's the reason YOUR taxes are so high.
The Reagan Administration came to the conclusion, as a result of this supply side silliness that it doesn't matter if people actually have the money or not because we're all about raising corporate profits. So they cut corporate taxes, gave them money to the corporations by way of subsidies, bonuses, more free Federal land for the oil industry, mining industry, etc. We're going to change our rules on international trade so their manufacturing floors can move overseas, they can make the cars in Mexico, make the toys in China, etc, etc. so labor becomes cheaper, as a consequence of that corporate profits go up as well we didn't see necessarily where prices went down, but profits did go up. So the bottom line was, destroy the ability of the wage earner to earn money and shift all this money up to the top. There's a slight problem here, who's going to buy anything if they don't have income anymore?
We've seen the income of the average American worker erode after it had climbed for years and years. From 1949 to '59 the median income of American familes grew by 37%. From 1959 to '70 it grew by 41%, that's SUBSTANTIAL INCREASE in the income of working people. People were making more money every year. People knew that they could do better than there Dad had. Every year was a better year as far as income was concerned. By the end of the Carter Administration, mainly because we were ringing out all the money borrowed for the Vietnam War it dropped down to 6.8% during the late 70's and 97% of that went to the top 20% of families. Since Reagan came along real income for wage earning Americans, people who earn a paycheck and don't live off of dividends. Real income has DECREASED steadily.
So the Republicans looked at this and said this is working out well for our fat cat campaign contributors, the top 2%, the millionaires and the billionaires, the top tenth of 1%, but we've got this problem, we've got consumers that aren't buying stuff. So Greenspan came along and said, loosen credit, let them borrow. During the 40's and 50's when we were seeing wage growth every year, the middle class became strong, people bought their homes, they bought their cars, land, ASSETS! Let's strip them of their assets. Make it easy for them to refinance their house as times get tougher, make it easier to buy on credit, don't even buy a car, just lease it. Let them run up credit card debt high intrest rates and make it easy for the credit card companies to screw them.
Basically what has happened over the last 30 years Americans have, by government policy, been thrown massively in debt as a way to keep buying stuff, as a way to keep the economy moving and here we are now, it's coming to an end. It's coming to an end in two ways, Number One; We're reaching the limits of credit. Americans are tapped out. We're so broke we can't afford to borrow money anymore. Number 2; The government has been doing the same thing. 70% of the TOTAL DEBT of America was run up by THREE REPUBLICAN PRESIDENTS!!! Two Bushes and a Reagan.
The consequence of this is that our dollar is falling through the floor, now places like Abu Dhabi and other countries around the world that have a dollar peg are strongly considering de-pegging our currency and theirs.
It's time to get past ideology and admit to ourselves for all of their talk, all of their shoving it down our throat, it's time to admit that Republican policy has failed the United States of America, and as a result, we, the good ol' U.S. of A. as the leaders of the free world, with all of our promise to spread good will and uplift and promote democracy and freedom of thought everywhere have failed in our stewardship of our own Constitution, and our own freedoms.
We are citizens, it's time to act like it. Don't be distracted by a go nowhere culture war, be sensible and do what's right, stay away from what's wrong (even if it's legal) and don't be anybody's fool!!
