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The latest online populist movement, given prominence through ad nauseum Fox News coverage, is the TEA Party organization. Tomorrow, wednesday April 15th, the organization will be holding nationwide protests and rallies in opposition to paying taxes. The coast-to-coast teabagging rallies will protest such things as: “spending trillions of borrowed dollars, leaving a debt our great-grandchildren will be paying”; people who “want to take your wealth and redistribute it to others”; “punish those who practice responsible financial behavior and reward those who do not”; “run up trillions of dollars of debt and then sell that debt to countries such as China… [and] want government controlled health care?”; “refuse to stop the flow of millions of illegal immigrants into our country”; and to protest “want to force doctors and other medical workers to perform abortions against their will… [and] want to impose a carbon tax on your electricity, gas and home heating fuels.” At the Atlanta tax day TEA party, Sean Hannity will host his Fox News show; the entire event is also supported by Michelle Malkin and Newt Gingrich. Sounds fun!
Can I just point out that many of these items have nothing to do with taxes? Abortion? Immigration? Health Care policy? It’s all a bunch of rubbish, if you ask me. And if you ask Paul Krugman, who had this to say: “The tea parties don’t represent a spontaneous outpouring of public sentiment. They’re AstroTurf (fake grass roots) events, manufactured by the usual suspects.”
The conservatives who have organized these rallies and protests have wrapped themselves in the lore of our nation’s early patriots, who dressed as Natives, and, in the dead of night, secreted upon boats carrying crates of tea. In protest of Britain’s imposition of a tea tax, these patriots tossed the crates overboard, thus ruining the tea. The TEA protesters are not trying fighting for Independence, or fighting to throw off the yoke of oppression: this is the latest attempt by the right to undermine America– to undermine progress. They scream “socialism,” or decry Obama’s deficit spending, or his so-called attempt to shift wealth from one class to another. Where were these voices when President Bush rammed his tax cuts for the uber wealthy through congress, which was literally the largest transfer of wealth in American history? Where were these voices when President Bush doubled the national debt, adding some $5 trillion? And he oversaw the Chinese take-over of the American economy! And where were these voices when President Bush started bailing out the giant financial institutions, who were free to run-amuck under his administration’s deregulation policies? Where were these voices?
I’ll tell you where these voices were–
These voices, only a few short years– months– ago were singing the praise of George W. Bush, and screaming at liberals or anyone who questioned the President, calling them “unpatriotic” or “un-American.” These hypocrites have the audacity, after eight years of that shit, to call President Obama a tyrant, a socialist, or anything else they can think of, in a time when he is trying to fix all of the messes left behind by his predecessor. He didn’t create the financial mess– Bush did; he didn’t allow the Chinese to buy up our debt– Bush did; he didn’t create the vast disparity between rich and poor– Bush did; and on and on it goes. Now, President Obama find himself in the worst economic situation since the Great Depression, and these hypocritical Bush-lovers are ready to lynch the President. Just listen to the insanity of Rush Limbaugh, or Sean Hannity, or Glenn Beck… it’s fucking madness! I- there are no words to describe how this just blows my fucking mind!
Even more amazing to me is the fact that there are so many Americans who are swayed by this ant-tax group. Yeah, it’s a pain in the rear to have to pay taxes, but it is nonetheless necessary in order to have a civilized society– it’s nice to have roads, bridges, policemen and firemen, an education system, government, and all the fancy things we enjoy everyday, but take for granted. So it kills me when people, who are either lower class or lower-middle class, are so angry about the tax code. I totally understand why the mega-rich don’t like paying taxes– they pay quite bit in taxes every year. But, in reality, many of these mega-rich people find loop-holes or write-offs. In many cases, they either don’t pay as much in taxes, or don’t pay any taxes at all. Take, for instance, Warren Buffet, who is the worlds third richest man: Warren Buffet pays less in taxes than his secretary! At a fundraiser, Buffet admonished his fellow wealthy elites by saying, “The 400 of us [here] pay a lower part of our income in taxes than our receptionists do, or our cleaning ladies, for that matter. If you’re in the luckiest 1 per cent of humanity, you owe it to the rest of humanity to think about the other 99 per cent.” He went on to describe how he had only paid 17.7% in taxes on the $46 million he made, while his secretary paid 30% on her $60,000 income. He described the Republican mentality that says, “I’m making $80 million a year – God must have intended me to have a lower tax rate.” This is the unequal tax system that the protesters are trying to maintain– one that actually benefits the rich at their expense. They are angry that President Obama wants to create a fairer tax system by eliminating the Bush tax cuts on the super rich.
Where’s the logic in that?
The debate on “fairness,” with respect to taxation, has to do with equality. The rich complain about the fact that they pay more, which, they claim, is not fair. So, they send out the ignorant low and lower-middle class conservatives to protest a system that is, in reality, quite fair. The progressive tax system, created during President Roosevelt’s administration, was intended to tax people according to their ability to bear burdens relative to their level of income. In other words, the poor should have a smaller burden than the rich, due to the disparity of their incomes. Seems fair to me. Then again, I’m a poor bloke, and not some fancy pants wealthy elitist like Rush Limbaugh.
The growing trend among the conservative crowd is the so-called “Fair Tax” or the flat-tax. Mike Huckabee, during his 2008 Presidential campaign, boasted that “when the Fair Tax becomes law, it will be like waving a magic wand releasing us from pain and unfairness.” This seems, on its face, to be a good deal: abolish the income tax and the Federal Reserve and embrace a 23% tax on all goods and services. Seems simple, right? It even sounds a bit fair. Ah, but when one actually looks into the plan, it really benefits those who are wealthy, and it is at the expense of the poor. This is essentially “supply-side” economics at its best.
See, we poor (my wife and I fall below the line of poverty) actually spend more than we make. We don’t really save, not because we don’t want to, but because there just isn’t any money at the end of the month to do so. So, under the flat tax system, we would be paying at a 100% tax rate on our income. Those in the middle-class, who spend about 80% of their income, fall into the 80% tax bracket. Meanwhile, Warren Buffet and Bill Gates, who have loads of money that they could never spend in a lifetime, fall into the 5% tax bracket. So what this so-called Fair Tax does is penalize the poor and working class families, who already have a tough time making ends meet, while allowing the rich, who have money to burn, to spend less in taxes. Does this seem fair? Not only that, but the
Congressional Joint Committee on Taxation projected a ten year $2.5 trillion revenue shortfall in the event that the Fair Tax proposal became law. Hmmm… who would get to keep all that money? The rich, of course. Does that seem fair?
(Tables come from Bruce Bartlett)
To the Hannitys and Limbaughs of the world, it does.
Neal Boortz and John Linder, authors of the Fair Tax Book, argue that this obviously regressive tax system that favors the rich would still benefit the poor because of the “pre-bates” they would receive. Pre-bates, just to inform the reader, are determined by the Census Bureau’s calculation for the poverty level, divided into twelve months, which would work out to $196. This income would go to everyone, at all levels of income despite need. Ah! But wait! Families who spend those pre-bates will be taxed again at the 23% rate.
There is also the issue of simplicity. The Fair Tax proponents argue that their proposed system would be easier. When Steve Forbes ran for president he famously pledged that Americans would only have to deal with a postcard sized tax return. Instead of Federal taxes, or state taxes, medicare or social security taxes, or corporate/business taxes, there would simply be one flat (and “fair”) tax: the 23% tax on goods and services. Would people prefer to pay more in taxes and have a simpler system? Or, do you think, people would prefer a complicated system that allows them to pay less in taxes? I think the latter option is the obvious choice.
There are a whole host of other problems affiliated with the Fair Tax initiative. Critics fear an increase in black market sales; others wonder how the proposal will deal with tax evasion, since there will be no IRS; how will states get their revenue?; there is the matter of the revenue shortfall; how the proposal will affect workers’ wages; and the cost of transitioning from one system to another.
Well, it’s late and my wife is beckoning me to the mattress we have in the corner of our small bedroom. So, to end my diatribe, I can only wish the TEA baggers well. I hope it all goes down smoothly, and without fuss. I’d like to go, but I’m just not into that sort of thing. I was tempted to attend the rally in my town, bring along a video camera, and film the event. But I think I would go insane and start yelling at people… I would then be assaulted by an angry mob.
Thanks, but no thanks.
I’m celebrating Tax Day by working. Earning what little money I can, and paying what little taxes I can afford to Uncle Sam.
So, what’s the deal with Afghanistan?
Barack Obama has been President… about 68 days? And already, as he plans to draw down 100,000 troops in Iraq over the next 18 months, and send another 21,000 troops to Afghanistan, there are already people describing the war in Afghanistan as his “Vietnam.” What is being neglected is the fact that he has inherited two horrific wars, both of which are unpopular, especially within the Democratic party. While these wars may very well suffer from a lack of public support, he is in the difficult position of having to recraft American policy so that he can safely exit both arenas, while shifting focus onto Al Qaeda… remember those guys? The ones who attacked us on 9/11?
Those who would compare President Obama and President Bush’s approach to the wars simply are not paying attention, or are hoping he fails. In Iraq, as mentioned, he is drawing down troops in preparation for an exit before 2011. Within Afghanistan, President Obama is already trying to build an international coalition so that it is not just the United States that bears the full burden. Due to the iron grip of the NeoCons in Bush’s first term, there was virtually no attempt to build a coalition beyond a few token troops from our closest allies. Also, President Bush generated so much animosity and disdain that few nations were willing to step forward and send troops to either Iraq or Afghanistan. President Obama has gone on a diplomacy offensive in order to round up support. He is very popular around the globe, a fact he hopes will gain him the support of world leaders and their troops. In addition to troop increases, President Obama is also going to send civilian experts to Afghanistan to help the fledgling nation develop its economy and political structures. They will also increase the training of Afghan security forces so they can bear responsibility for their own long-term safety.
While President Bush ignored the war in Afghanistan, assuming that the mission was accomplished, the Taliban slowly made a come-back and learned the lessons of guerrilla warfare that were being taught in Iraq. President Obama has promised to refocus our efforts into Afghanistan in order to keep the Taliban away from power, and to prevent them from recreating a safe haven for Al Qaeda. The central strategy will be one of divide and conquer. The Taliban is fractured, with two-thirds of Taliban forces more concerned with local issues, while the other third, led by former Afghan leader Mullah Omar, want to fully regain their control of power. The President hopes that by taking a political, rather than military, approach with the Taliban forces focused on local issues, he can pit the Taliban against itself and against Al Qaeda allies. This strategy also won glowing praise from Afghanistan’s President Hamid Karzai.
Another fact, which was ignored by President Bush, was that the Taliban have found a safe haven along the Pakistan/Afghanistan border. This is where counter-insurgency operations will have to be conducted, and there is already evidence that President Obama is using Unmanned Aerial Vehicles, known as Predator Drones, to strike at Taliban and Al Qaeda militants hiding along that porous Pakistan/Afghanistan border. The strikes, which have increased dramatically since August 2008, have sown distrust and division within the Al Qaeda ranks, an effect that they hope will be replicated within the Taliban. A major concern, however, is that there have been numerous drone attacks that have killed civilians. These attacks have been condemned by President Hamid Karzai, who has insisted that attacks on civilians must come to an end. The attacks have had the effect of adding to anti-America sentiment in some areas, which is not helpful in the long-run.
But it is not just the fact that the Taliban and Al Qaeda enjoy protection along the Pakistan/Afghanistan border: the Pakistani military also needs to do more to root out these terrorist elements, which requires counter-insurgency training. Richard Holbrooke, Obama’s Special Envoy to Afghanistan and Pakistan, made a trip to those countries in early February in order to demonstrate the Obama administration’s desire to focus on that region’s woes. Appearing on the Charlie Rose show, Holbrooke spoke about the need for Pakistan’s military to evolve away from being India-centric and to focus on counter-insurgency training. He also indicated that he would like to see more Pakistani troops along the border. “There is no way,
Charlie, that the international effort in Afghanistan can succeed unless
Pakistan can get its western tribal areas under control,” Holbrooke said. The Pakistan government needs to rein in terrorist organizations within, or there can be disastrous consequences. As was seen in December, with the attacks in Mumbai, these terrorist elements want to spark a larger war between India and Pakistan so they can continue their operations along the western border of Pakistan. The Taliban and Al Qaeda represent a threat to their own continuance as a nation, a threat they need to better understand. President Zardani’s wife, Benazir Bhutto, was assassinated by the Taliban, a prefect and personal example of the Taliban threat. Therefore, it becomes a necessity for the U.S. to train the Pakistani military and to provide support for the Pakistani government. This is a regional problem, which President Obama will work hard to resolve.
Though it is important to refocus on Afghanistan, President Obama needs to understand that the continued presence of U.S. troops in the middle-east is a factor in increasing animosity towards our nation. For instance, one of Osama bin Laden’s main grievances against the U.S., pre-9-11, was the presence of U.S. troops in Saudi Arabia. This sentiment was felt across the Arab region, and it is felt even more powerfully as the U.S. is engaged in two wars in the region. However, despite this reality, President Obama has inherited Bush’s mistakes, and now he has to make decisions that were forced upon him by his predecessor. His choices range from bad to worse. In the short-term, it is necessary to drive back the Taliban in militarily, but in the long-term it is necessary to provide economic support and to help rebuild Afghanistan’s infrastructure. The seeds of this strategy have been planted already, as the civilian diplomats en route to Afghanistan are going to focus more on local development and governance, as well as security training. The political solution to the war in Afghanistan is ultimately what will bring us “victory”… which, for many Americans, is defined as bringing our troops home safely.
For President Obama, this the top priority, in terms of foreign policy. After his first National Security Council meeting, Obama was “calm and cool,” while others (such as Rahm Emmanuel) were stunned. “The general feeling was expressed by one person who said at the end, ‘Holy shit.'” There are a multitude of problems, including reining in the production of opium, curbing government corruption, and forging unity among the differing regions and warlords, and creating a sustainable and responsible government. These are some tough challenges and President Obama seems eager to take the challenge. He must, however, keep in mind his history: the Soviet Union deployed over 100,000 troops into Afghanistan and they were ultimately defeated. If he wants to avoid a quagmire, then he needs to split the civilian populations from the Taliban and Al Qaeda insurgents through positive developments in their society. He also needs to make sure that, in the long run, there is an Afghan face on both their government and military. This is a dangerous time for Afghanistan. There can be virtually no mistakes.
AAAAnd on a completely different note, just for the sake of levity, some hilarious pictures I found.
I quite enjoy the first one…
Remember her? How could we forget?
Does everyone know that I have a BA in history and will (crossed fingers) teach US history at the High School level?
If not, then… now you know.
I’m also about to finish my BA in English, so I’ll be able to get a job teaching English if there are no history positions. But that’s not really what I’m writing about.
This is what I’m going to write about…
Glenn Beck, a tearful and moronic Fox News commentator, as well as other Republican commentators and congresspeople, have all criticized President Obama for comparing the current economic crisis to the Great Depression. Somehow saying that this economy is the worst since the Great Depression, while factually true, is unbecoming for a President. After 8 years of a President trying to put a rosy face on a horrific war, sagging economy, and the loss of American prestige around the globe, I’m very glad to have a President who can tell me the truth.
I can handle it, Barry. Give it to me straight.
Well, not everyone can handle it, apparently.
I have also heard gross misrepresentation of historical facts. The biggest distortion, heard time after time on Fox News, is that President Franklin D. Roosevelt did not end the Great Depression with the ultra-socialist New Deal policies, therefore disproving Keynesian economics altogether. While it is true that the New Deal policies did not cure the Great Depression, for many years it did alleviate some of the crisis. What is also true is that World War 2 ended the Great Depression, a fact that Obama critics point out in order to doomsay down his stimulus package and soon-to-be budget. The fact that World War 2 ended the Great Depression actually proves that President Obama’s plans have some chance of working, not the other way around.
Let’s begin with some background on the lead up to the Great Depression…
Following World War 1, the American economy was struggling to recover. Most of the European nations saw their economies collapse, but the United States, for the most part, had only to contend with rising prices and inflation. In 1921, however, the economy stumbled: over 100,000 businesses went bankrupt; 5 million Americans lost their jobs; and 453,000 farmers were forced to abandon their land. Part of this economic tumult was a result of labor strife and discontent with labor policies and practices.
However, by 1922, the economy rebounded and expanded in an unprecedented way. This had a lot to do with leaps in technology that allowed for a 60% increase in manufacturing output. The major industry, at this time, was the auto industry, thanks to Henry Ford’s innovative assembly line. Increased mobility made it possible for greater and faster transportation of goods, products, and resources. It also connected the rural areas with the urban, and increased demands for suburban housing. Advances in aviation and railroads also made transportation faster and more efficient, which helped spur the economy forward.
As the economy grew, and goods were easier and cheaper to produce, people were beginning to consume goods at a scale previously unseen in this country. This rise in consumerism also led to the creation of our modern advertising industry. Thanks in part to the development of the radio, mass-produced magazines, and the emerging movie industry, the advertising industry was one of the most successful of the decade. The “Roaring Twenties,” as the decade has come to be known, was really more of a period of conspicuous consumption for only a small portion of society.
The other, larger, part of society was able to buy goods through the use of credit. Half of the families, by 1929, were unable to buy any of the consumer goods that had been created out of technological advances. That inability to have access to purchasing power caused a decline in profits for companies, which only made it increasingly difficult to provide jobs and adequate wages for employees. The other major problem with the American economy was the focus on the construction and automobile industry. As fewer and fewer people purchased cars (the others either already owned a car or were unable to buy one) the profits for those industries fell sharply in the final years of the 1920’s. As banks began to suffer financially with the rise in defaulted loans, they began to call in on loans that borrowers were unable to pay. During the 1920’s, banks were recklessly loaning money to people who were not likely to ever pay back the loan. As defaults began pouring in, they tightened their rules on whom they would lend to, further worsening the growing crisis. Throughout the decade banks were gambling in the stock market with other people’s money, and as the stock market crashed they lost significant portions of people’s money. But it was also the debt of foreign nations that weighed the American economy down. Many European nations owed the U.S. huge sums of money, which they, too, were unable to pay off. So, stupidly, U.S. bank loaned huge sums of money to European countries in order to pay off the older debts. Protective tariffs in the U.S. also made it difficult for Europeans to sell their goods in the American market, making it that much more difficult for their economies to recover. On top of all this, the United States began to lose their edge in the trade industry. As Europe began to recover from WW 1, they relied more on domestic goods and agriculture and less on imported American goods and agriculture. By the end of the 1920’s, two-thirds of the American people were at or below the poverty line. The so-called “Roaring Twenties” were nothing more than a gilded hollow shell.
When President Herbert Hoover came into Office, the economic disaster had not yet dawned. He was a conservative “self-made” man, which fit into the national narrative– rags-to-riches-Horatio-Alger baloney. However, when the stock market crashed on October 29, 1929, the American people went totally batshit. People jumped out of windows, men left their families, and people were making hurried runs to the banks to withdraw their cash– only making the situation worse. President Hoover tried to calm the American people by reassuring them that prosperity was just around the corner, or that the economy wasn’t really all that bad. In a series of bad public relations moves, President Hoover made appearances at baseball games to throw out the first pitch, distributed pictures of him fly-fishing, and engaged in activities that he hoped would convey to the American people that he was confident in the American economy.
Instead, he only proved to the American people that he didn’t give a damn about their suffering. He was a self-made man. He wanted all Americans to pull themselves up by their boot-straps (even if they didn’t own boots) and make themselves rich. He was not about to offer any meaningful government assistance. His conservative values would not be compromised for the sake of the American people.
So, in 1932 he was out on his ass.
The charming, eloquent, and compassionate Franklin D. Roosevelt won the election 1932 with the promise of a New Deal… he wasn’t quite sure what the new deal was, at the time, but to the American people it sounded a hell of a lot better than nothing, which is what President Hoover had given them. Roosevelt won a resounding victory, with 57.4% of the popular vote and 472 electoral votes to Hoover’s 40% popular vote and 59 electoral votes. On inauguration day, as Hoover and Roosevelt sat together in the Presidential limo, Hoover, in no mood to talk, sat pouting, while the newly elected president waved to the throngs of people with his hat, as they hoped to catch a glimpse of the man they hoped would bring change.
And change he brought.
His first 100 days in office were the busiest in the history of the nation, with many bills submitted to congress to insure banks (FDIC) and keep them afloat (the Emergency Banking Act), revamp agriculture through the Agricultural Adjustment Administration, restricted speculation with the Glass-Steagall Act, made it easier for laborers to bargain collectively, created the National Recovery Administration to spend large sums of money on public works, and the creation of the Tennessee Valley Act, which allowed for the construction of dams in order to generate electricity. Of course, over the years there were many other programs such as Social Security and the creation of the Securities and Exchange Commission (SEC). All of this had the effect of creating confidence in President Hoover, who had demonstrated his willingness to experiment with different policies in order to solve the financial crises. And the American people needed it: at least 25% of the American workforce was unemployed (this figure is probably low), another third of the population was underemployed, and natural disasters in the mid-west were forcing farmers to head out west in search of jobs. Many people who were without homes were forced to live in tent communities called Hoover-villes, named after the reviled Herbert Hoover. The Great Depression also had a huge impact on families and the self-confidence of many. Americans had swallowed all the baloney about Horatio Alger and rags-to-riches tales, so when the economy collapsed many people blamed themselves for their abject poverty, instead of the corporate and banking fat cats who brought the economy down. This self loathing caused many men to commit suicide or to leave their families out of shame. This was indeed the darkest period of history since “the Dark Ages, and it lasted 400 years,” as John Maynard Keynes once famously remarked after being asked if there was any time comparable to the Depression the country was in.
John Maynard Keynes, a British economist, developed the theory that government intervention in the market, which could lead to booms and head-off recessions. It was the Keynesian theory of economics that prevailed in the Roosevelt administration, as they attempted to tackle the Great Depression and rein in out of control markets. At the time, his policies were attacked as “socialist” and many argued that they would not work. Many today also argue that Keynesian economics did not pull the economy out of the Depression. Ah, but they are oh so wrong.
By 1937, there were signs of improvements in the economy. The national income jumped to $72 billion from the $40 billion in 1932. Millions of people were put to work, causing the unemployment rate to drop to 15%. Labor unions were gaining strength, child labor was outlawed, and a minimum wage was established. Though these improvements seem meager, it is only because there were conservative within President Roosevelt’s cabinet that were always attempting to water down his bills and reduce the amount of money he wanted to spend. This became even more evident in 1937 when the economy took a turn for the worse. The conservatives in his cabinet pointed to the improving economy as evidence that they should reduce government spending, an argument which convinced President Roosevelt. Almost immediately, the economy tanked. The economy began to recover in 1938 when the President approved a $5 billion public works bill, a recovery that took nearly 5 months. In 1938, FDR created the Fair Labor Standards Act, which established a 40-hour work week. By this time, the banking industry had been turned around and strengthened, laborers and farmers were given unprecedented power and protection, the stock market was safe-guarded against irresponsible speculation, and the elderly and pitifully poor were provided safety nets that did not previously exist.
What really ended the Great Depression, however, was the emergence of World War 2. Critics of Keynesian economics point to this fact as evidence that his theory failed to end the Depression. However, the Keynesian theory is prooven true by this truth.
The United States was pulled into war after the Japanese sneak attack on Pearl Harbor on December 7, 1941. Overnight, the huge unemployment, deflation, and slump in manufacturing vanished because the U.S. government spent unprecedented sums of money in diverse industries, which was exactly what Keynes had predicted would happen. For example, the federal budget had been only $9 billion in 1939, but it leapt to $100 billion by 1945, and the gross national product soared to $166 billion. The government spent $321 billion dollars– an amount that doubled the combined government expenditures over its 150 year history and ten times as much as the government spent in World War 1. Personal incomes increased by 100% as nearly 15 million men and women were put to work. This huge influx in government money into vital wartime industries caused– at its peak– many companies to produce twice as much as the Axis powers produced, and a lot more than the U.S. government actually needed.
In short– Keynesian economics was prooven to work through the massive government spending of World War 2, contrary to what conservatives would have the public believe.
As President Obama prepares to spend massive sums of government money to revive the economy, the American public would be wise to remember the lessons of the Great Depression and World War 2.
The first lesson is to not allow conservative critics to water down and stem government spending. That will not only delay and inhibit growth, but it could also lead to a worsening of the economy. The second lesson is that massive public work projects and an influx of government money into the economy will create jobs and raise all boats. It will be painful in the short term, but we can either have a long recession that could turn worse, or we can spend a significant sum of money and force the economy into the black.
Right now, President Obama is our FDR while the grumpy Republican nay-sayers are our Hoover. We all should support his economic policies– not because we’re dopey Obamamaniacs who are blinded by his “charm,” but because history has shown that the policies he is pursuing work.
God bless, America.