Choosing a candidate, choosing a direction for the country
At long last, the elections are upon us. We will be choosing between two well-educated and pleasant men from different backgrounds with different ideas on what is best for this country.
However, we will be voting not only for a person, but for what each candidate represents regarding issues that will impact our future -- appointments to the Supreme Court, foreign policy, women’s rights, immigration, health care, Medicare, the environment and more.
The central themes of the campaign have been simplified to “jobs and the economy,” but the core issues are not new. They are, of course, the national debt and economic inequality. Both have been growing and widening respectively for decades and include the above.
Job growth alone will not solve income disparity if those jobs are low paying. Income inequality has not been this great since just before the Great Depression and it is doubtful that the two circumstances are coincidental.
The argument has been put forth that as the rich get richer, everyone else will benefit as that wealth “trickles down.” That does not seem to be the case. As one example, last year the median household income dropped by 4 percent while the wealth of the Forbes 400 increased by $200 billion. A key reason for this growing disparity is because the rich move their money into investments, which are taxed at the low 15 percent tax rate of capital gains.
As an interest group, the wealthy hold an inordinate amount of power and have succeeded (through political lobbying and donations) in getting policies that help them when it comes to tax breaks, loopholes, bailouts and regulatory policies. The ensuing wealth created by such policies moves upward, not downward. As a result, spending by average American families is reduced because they are forced to consume less in order to make ends meet.
The wealthy may make extravagant purchases, but it is only a small fraction of their income compared to those at the lower income end, that is, most Americans. In other words, one person buying four sports cars doesn’t stimulate the economy as much as four hundred or four thousand people purchasing one mid-size car each.
Many of us didn’t feel the economic pain sooner because the housing bubble -- artificially and deceitfully pumped up by Wall Street -- had not yet burst. Meanwhile, the income gap was still growing as fast as the national debt. Not many politicians were making an issue of it.
And then the bubble burst.
And we became aware of the cost of two unfunded wars and the amount of revenue lost over the years to tax cuts. It didn’t happen overnight.
We can’t just tax our way out of this but we can’t budget-slash our way out either. Cutting all spending has a way of creating more unemployment.
We need to look at how we spend our money. We don’t address the bipartisan problem of corporate welfare. We give billions in subsidies and tax breaks to oil and gas corporations and agribusiness who in turn finance campaigns of politicians in both parties who will vote to continue to subsidize them. We spend 50 percent more on corporate subsidies than we do on social welfare. And then there’s military spending, including maintaining 662 military bases in 38 foreign countries with a proposal to increase that spending by billions more.
It will likely take a combination of raising taxes on the wealthy, spending cuts in some areas and re-investment in others. That, however, would require compromise in Washington.
Slashing taxes even more and just assuming it will create millions of jobs makes no sense, especially when there is little evidence that tax cuts do anything other than redistribute money to the top. Perhaps if there was, our choice would be easier.
Editor's note: This column originally appeared as a community column in the Oct. 28 Walworth County Sunday newspaper.
Jim Black is a community blogger and is not a part of the Walworth County Gazette staff. His opinion is not necessarily that of Walworth County Today staff or management.