The end of voodoo economics?

I was never a big fan of President George H.W. Bush although, compared to his son, he was a fabulous president.  And he did get one thing right – his description of Reagan’s theory of trickle-down economics.  That’s right.  It was George, the elder, who first appropriately labeled it “Voodoo” economics. 

The idea that cutting taxes for the wealthy would somehow benefit the rest of us never really made any sense.  It was clear to me that the wealthy would simply spend the extra money on themselves or invest it in the stock markets.  I couldn’t see how the theory would result in more jobs or increased living standards for everyone else.

What did make sense to me was the idea of cutting taxes on companies that created jobs, and Reaganomics did do that.  Unfortunately, the Reaganists relaxed or eliminated many of the regulations and safeguards that controlled corporations.  The result was tax cuts and tax credits for large corporations that took their manufacturing jobs overseas.  And due to the lack of regulation, many corporations created phony “headquarters” in the Bahamas and the Caymans to avoid paying taxes altogether.  Amazingly, Republicans refused to even consider banning these off-shore companies from receiving U.S. government contracts. 

How on Earth were U.S. citizens, other than corporate officers, supposed to benefit from that?

The short answer is that we didn’t.

In an op-ed column for The New York Times, Nobel Prize-winning economist Paul Krugman summarized the real effect of Reaganomics.  “…real incomes of the top .01 percent of Americans rose sevenfold between 1980 and 2007.  But the real income of the median family rose only 22 percent, less than a third its growth over the previous 27 years“.  Krugman also points out that “most of whatever gains ordinary Americans achieved came during the Clinton years “, and that President George W. Bush “…had the distinction of presiding over the first administration since Herbert Hoover in which the typical family failed to see any significant income gains”.

Of course, Krugman’s statistics don’t include the fiascos of 2008 in which the Fed started bailing out banks long before the public noticed; when gasoline prices hovered around $4 per gallon; when foreclosures dragged down the entire economy; and when the Bush and Obama administrations had to bail out Wall Street.  All of these issues are likely to make the final cost of Reaganomics look even worse.

Yet despite all evidence to the contrary and despite the near-disastrous collapse of our entire financial system under their leadership, Republicans still cling to the notion that the failed economic policy of their former leader and idol can cure our present-day problems.  “Make the Bush tax cuts permanent,” they say, “that will bring our economy back.” 

If Republicans should somehow regain control of Congress during the 2010 mid-term elections, be afraid, my friends.  Be very afraid.  Like other apparitions of black magic, voodoo economics may be more difficult to kill than you think.

Return to the “Good Old Days?” Be careful what you wish for.

I receive a lot of emails, mostly from my conservative friends, of the “Remember When?” variety.  Of course, they focus on the “Leave it to Beaver” days of the 1950 and 60s.  A recent one started me wondering why we look back on those days so fondly. 

After all, the 50s were pre-civil rights and pre-feminism.  They were also the days of Sen. Joseph McCarthy and impending doom from Soviet H-bombs.  And the 60s revolved around the Vietnam War.

So why do we remember those days so fondly?  I’m sure part of the reason is that we were kids and teens who didn’t worry about politics and the ills of the world.  In addition, there was a black and white honesty to those days when right and wrong seemed more clearly defined.  But I submit that one very big reason is that there was less disparity in income.  Around the small town where I grew up, it was more difficult to tell the “haves” from the “have-nots.” 

That was partly due to generational modesty – it just wasn’t polite to show-off. 

It also had a good deal to do with tax codes.  It might surprise you to learn that, during the Republican Eisenhower administration, the income tax rate for the top bracket was 91-92 percent.  In contrast, the tax rate for the bottom bracket was 22 percent.  By 1971, the top rate had dropped to 70 percent while the bottom rate dropped to 14 percent.  And today, the top rate is 35 percent while the bottom bracket is 10 percent.  

Given the fact that income taxes have dropped dramatically since 1951, you would think that most of us would be feeling pretty good about our taxes and government.  Unfortunately, there seems to be a growing anger as evidenced by the “tea-baggers” and “anti-health care reformists” who shout slogans and carry signs demanding their country back. 

Hmmm…I wonder how those people would feel about bringing back the tax structure of the “good old days?”

Those people seem to forget that many of the things we enjoy and take for granted were created by government and subsidized by taxes:  Education, Social Security, Medicare, Medicaid, V.A., the G.I. Bill, the interstate highway system and the national park system to name just a few. 

The truth is we have more than any of the generations before us.  In general, we keep a greater percentage of our earnings than before.  We have more time for recreation than ever before.  And in comparison to the days of McCarthyism and Jim Crow laws, there’s less government intrusion in our lives.  So why do conservatives think the 50s and early 60s were so wonderful?

My theory is that, we didn’t have people like Rush Limbaugh, Bill O’Reilly, Sean Hannity and Glen Beck ranting about how bad our government is and trying to pit one faction of our population against another. 

For me, the (Republican) party’s over.

For many years, there was a tradition in politics. You could count on each side giving its “spin” on an issue in hopes of influencing voters to their point of view. If you didn’t have the time or inclination to research the issue on your own, you could be relatively certain that the truth was somewhere in the middle. But sometime in the 1990s that changed.

I first realized the change in 1999 when I visited the website of the Republican National Committee in search of quotes from conservative Republicans. What I found was “Gore Gaffs,” dozens of ridiculous statements attributed to then-Democratic presidential candidate, Al Gore. The only problem was that I recognized all of the quotes as having been made by Dan Quayle. I was dumbfounded. Why would the leadership of a political party lie about something that could so easily be disproved? For what possible benefit?

The only conceivable answer is a cynical one – the party believes that no one will actually recognize the lie or hold the party accountable. Unfortunately, “Gore Gaffs” foreshadowed an ugly and disturbing trend by the party.

The Bush administration used lies and half-truths to lead us into an unnecessary war in Iraq. It lied about the “outing” of a clandestine CIA agent whose husband publicly exposed administration lies during the run-up to the war. It lied about the firing of U.S. Attorneys. It lied about eaves-dropping on American citizens. The list of lies during the Bush administration is quite lengthy and growing. In fact, former Homeland Security Director, Tom Ridge, recently admitted that he was pressured to raise the security threat level in 2004 to help Bush get re-elected. And it was recently discovered that former Vice-President Dick Cheney and the CIA hired a mercenary force (Blackwater, aka Xe) to form an international hit squad that was unconstitutionally kept secret from Congress.

Complicit in all of the lies are Fox News and conservative talk radio hosts like Rush Limbaugh. Rush has long been known to make things up in order to whip his audience into a frenzy and increase his ratings. And, although Fox claims to be “fair and balanced”, it’s anything but. Former Bush Press Secretary, Scott McClellan, admitted that the administration used Fox to “get out its talking points.” It takes only a few minutes of viewing to realize that Fox News is simply a megaphone for Republican lies. But, of course, its viewers are so partisan or uninformed that they don’t care or don’t know.

During the 2008 presidential election, the GOP was in full attack mode. The difference in tone couldn’t have been more striking. Indeed, had one not known better, one might have concluded that all of the problems created by 8 years of the Bush administration were actually the fault of the Democrats.

The 2008 elections were a strong rebuke of the Republican Party and its policies. But rather than examining the policies that led to the election defeat, the party decided to redouble its attacks. Republicans and their surrogates blame the loss on perceived voter fraud by Acorn. And, with a lack of real leadership, the party has turned to Rush Limbaugh as its titular leader. He and other conservatives are not just “spinning” issues based on their point of view. They are creating, or at least repeating, lies in order to scare people about the new administration’s policies.

Attempts to rescue our financial system following its collapse under Bush are described as “socialist” and unnecessary government intervention. The same terms were used to describe the rescue of the auto industry, one of our nation’s few remaining manufacturing industries. A carbon cap and trade bill will “lead to the collapse of the energy industry and put millions out of work.” Health care reform is a “Nazi policy using death panels designed to kill granny” or an attempt to “put bureaucrats between you and your doctor.” Never mind that three government-run health care programs are run quite well. VA, Medicare and Medicaid are generally well-liked by those who participate in them.

At town hall meetings, angry conservatives have tried to shout down any real discussion of the issues, and, as if to make their shouts more forceful, some have brought loaded guns.

The Republican Congressmen and Senators refuse to discuss policies or the merits of legislative initiatives. They offer no counter-proposals. All they offer are lies, fear and more tax cuts for large corporations and the wealthy. And if any Republicans dare break ranks with their brethren on a single vote, they’re labeled RINOs (Republicans In Name Only) and they’re attacked by even more conservative candidates in the primaries.

For more than 30 years, the Republican Party has led an assault on the middle class and the poor with “trickle down” economics. In truth, under Republican leadership, the economy was reduced to a trickle. And none of the tax cuts have trickled down.

Indeed, a recent study found that the disparity between the wealthy and the rest of the population has reached the highest level since 1913, and the tax rate on the wealthy has dropped from 70 percent in 1980 to 35 percent in 2009. Thanks to Republican policies, as of 2007 .01 percent of the population controlled 10 percent of the wealth and 10 percent of the population controlled 49 percent of the wealth. And, if you want to consider the effect of Republican policies on health care reform, 47 million Americans are now uninsured, millions more are underinsured and nearly a million Americans will be forced into bankruptcy this year by illness.

This is why a fiscal conservative and social liberal like me no longer votes for Republicans. After 40 years as an independent, I am now a proud member of a party that respects me enough to not lie to me.

Why we’re divided

With the recent debate on health care reform, one thing has become painfully clear.  We don’t just have differing opinions of the facts.  We have differing sets of facts.  Indeed, differing realities.  These differences seem to have more to do with our choice of television programming than with age, education, opinions or ideologies.   For example, a recent NBC News survey asked respondents their opinions of 4 discredited myths regarding health care reform. 

According to the survey, 72% of Fox News viewers believe that health care reform will provide coverage to illegal immigrants (it won’t).  79% of Fox News viewers believe that it will lead to a government takeover of our health care system (it won’t).  69% of Fox News viewers believe that it will use taxpayer dollars to pay for abortions (it won’t).  And 75% of Fox News viewers believe that it will make decisions about when to stop care for the elderly (are you kidding me?).   These percentages were much lower amongst viewers of other cable news networks. 

This research points to a very real problem for our nation that goes beyond health care reform.  It’s one thing to debate facts.  It’s quite another if those “facts” are entirely different.  As a communications professional, I know that the most difficult communications task is to disprove a negative.  If the viewers of Fox News believe that Obama is out to kill Granny, there’s almost no way for him to disprove it in their minds.  If Obama says it’s false, the people who believe the negative will just say he’s lying.  If he points to credible news sources, the believers will just say that those sources are biased. 

Of course, we can’t blame all of our nation’s problems on Fox News.  There are plenty of politicians, cable networks, talk radio hosts, websites and PACs (Political Action Committees) across the political spectrum that are perpetuating myths and lies.  But since Fox News has larger audiences, it bears greater responsibility. 

So how do we break this conundrum and get back to debating the same set of facts?  The answer certainly can’t be bringing guns to public debates, shouting at each other and calling the other side Nazis or un-American.  The answer is to seek the truth from multiple news sources – preferably news sources with competing opinions.  Everyone must understand that many “news” programs are more entertainment than news.  We must understand that media are profit-oriented; if they can generate ratings by encouraging their staff to stretch the truth and pander to audiences, they will, regardless of the consequences.  Finally, we must hold the media and our politicians accountable for their lies. 

Our democracy relies on an informed public.  That’s a responsibility we must all take seriously.  That means seeking the truth.  And not being force-fed falsehoods and distortions by one or two pundits who have unlimited access to a camera and a microphone.

Hello!

This is a blog that will cover opinions on a wide variety of topics.  It’s my hope that it will stimulate thoughtful discussion and debate.