For a sitting President who inteds to run again, the State of the Union address is not only an attempt to discuss the issues and challenges of the day, but an opportunity to reflect on past accomplishments and to lay the groundwork for the re-election bid. George Bush did just that, but he was not the only member to last night formally start his election bid. The NY Times, in two ofhe most famously partisan and shamelessly un-nuanced editorials I have seen in years, also declared the beginning of their 2004 campaign. They have two candidates, of course- ‘Anybody But Bush’ or ‘Anyone with a (D) at the End of Their Name.’
Here is the opening paragraph of the first editorial, which serves as the rebuttal to all things domestic from this current administration:
When the president delivers his State of the Union address, we like to listen respectfully and respond politely. It is always easy to find things worth applauding. Last night, for instance, President Bush mentioned job retraining, immigration law reform and programs to help newly released prisoners re-enter society. The impulse is always to split the difference
Actually it’s quite a sensible comment. The US has the highest concentration of wealth in the top 10% of any developed country, about twice that of Great Britain.
If you distributed half of that then other Americans would have a lot more and the top 10% would still be doing comparively well.
There was a book written in the 80’s by Doctor Bhatra (IIRC) called the Great Depression of 1988. He predicted a lot of the economic problems of that time.
The theory is quite simple, that if the top say 10% gets too much of the wealth of the country the rest by definition have very little and cannot afford to buy products from the wealthy elite, and so the economy rund into problems.
This is combines with a trade deficit that is very large. Basically people are buying Asian imports and the Asians are buying treasury bonds to finance the deficit. In effect people are selling bonds to buy Asian disposable goods.
According to Bhatra the only way to fix it is to tax the wealthy to bring money back to the lower classes where it can percolate back up, a sort of trickle up theory.
He believed the same concentration of wealth created the Great Depression. It also explains how when Clinton raised taxes on the wealthy the economy improved.
It’s not a socialistic idea. Look for example what would happen if the top 10% of the population owned 99% of the assets. Obviously the economy would collapse because no one could afford to buy anything. The point is there is probably a tipping point where the top 10% get so much the rest of the economy starts to falter. We know that has to happen at some point because it would at 99%.
So progressive taxation is needed to redistribute enough for the lower classes to be able to buy from the rich and keep the economic cycle moving.
In some countries like Brazil the economy has virtually collapsed with the top 10% having a huge amount of the wealth. In that case the poor cannot afford to be consumers enough to fix the economy.
The economy is dynamic & if I triple my income it doesn’t mean that the money is taken from some poor single mom doing her best.
**It’s not a socialistic idea. **
Yeah, and water’s not wet, the NYT isn’t liberal and atrios is a moderate.
“…when Clinton raised taxes on the wealthy…” ???
I recall that just one of the taxes in Clinton’s “Middle class tax cut plan” that taxed all of us, was another increase of about 5-cents per gallon in the federal gasoline tax. That nasty little increase cost all of us a bunch and still is.
Why is it that the Dem/liberals fail to recognize that what JFK did, what RWR did, and what GWB is doing (cutting income taxes) makes better sense? I doubt that historians will look back at the Clinton years and rave about his fiscal expertise, or is it really possible to be taxed into prosperity?.
“It’s not a socialistic idea.”
If it looks like a duck, walks like a duck, and quacks like a duck, it’s a duck. And calling it a shovel doesn’t make it anything other than a duck.
Your scheme would remove incentives to work and produce. Those on the top would figure they shouldn’t work any harder because what they made would be taken from them. Those on the bottom would figure they’d be given things without working, so there’s no point in producing. And those in the middle would see what would happen to them if they worked any harder, and they would stop as well.
“There was a book written in the 80’s by Doctor Bhatra (IIRC) called the Great Depression of 1988. He predicted a lot of the economic problems of that time.”
There was a Great Depression in 1988? Did I miss something? The U.S. has had two fairly mild recessions in the past 14 years (very mild ones when compared with those of the early 70s and 1980-1982), but no depression. In fact, the countries with the poorest economic growth have been those with highly structured economies (like Japan) or those with more socialistic governments (like Germany and France).
Based on empirical observations, I’d say Dr. Bhatra doesn’t know what he’s talking about.
“The economy is dynamic & if I triple my income it doesn’t mean that the money is taken from some poor single mom doing her best.”
Yes it does. There is only so much money in the US in banknotes and if you own more of them someone else has to own less. So if ownership of that money becomes concentrated in too few hands the rest of the population can each own less money, and have to borrow it.
It’s the same with shares, real estate, bonds, etc. There is a fairly fixed number of these and if a concentrated few own a large percentage of them then the rest of the population can only own the rest and rent or borrow.
It’s like a poker game, if most lose their chips to the better players then the game falls apart.
Ahh…that explains it. So, there’s only as much money in the United States as there was when the Federal Reserve was formed? The money supply is static?
This explains thoroughly why we hear so many zero-sum arguments, given that the money supply is static and all.
Bummer… I just checked my supply of accessible “banknotes” (cash in my jeans) and I only have $42.00 on hand currently. I must be doing my part for that wretched poor single mother who is going without.
Curious: do my checking and savings account balances and Ameriquest accounts accentuate her plight? I mean my little stash of cash in represented on ordinary paper, not exactly “banknotes.”
“It’s like a poker game, if most lose their chips to the better players then the game falls apart. ”
Dead wrong. Wealth is NOT a zero-sum game. (Oh, and wealth is not the same thing as money supply.) If wealth could not be created, we’d all be cavemen fighting over the last cave to live in and the last shred of meat to eat.
Wealth is not a zero-sum game. Liberal economists like Krugman would certainly agree.
I don’t see how a liberal editorial page implies liberal bias. I subscribe the the wall street journal and with the exception of the last two pages of the front section it is a wonderful newspaper.
Malthus had the excuse that, in a pre-industrial, pre-scientific age, resources WERE relatively close to finite.
But how one applies Malthusian logic to the money supply (which, ultimately, one either prints or doesn’t) is bewildering.
Mito: Is there more food grown today than 50 years ago?
Is there more money IN CIRCULATION today than 50 years ago?
Are you familiar with the Ehrlich-Simon bet of the 1970s?
***There is only so much money in the US in banknotes and if you own more of them someone else has to own less.****
I’m stunned at the absolute ignorance. Stunned.
“Ahh…that explains it. So, there’s only as much money in the United States as there was when the Federal Reserve was formed? The money supply is static?
This explains thoroughly why we hear so many zero-sum arguments, given that the money supply is static and all.”
You an others seem to be missing the point. Naturally the wealth of a country rises and the money supply changes. Also the amount of currency in circulation changes.
Nonetheless over time the amount of the assets of the country owned by for example the top 10% is fairly static. Over the past few decades that percentage has been rising however.
There’s little point in arguing that it’s impossible to measure wealth this way, economists have been doing it for centuries. You take all the assets of people from e.g. tax returns and determine what equity people have.
The figures show that actual ownership of equity (the worth of goods minus the money owed on them) is highly concentrated. You can pretend otherwise but that’s the fact of it.
So the more wealth owned by a small percentage of the population the less ownable by the rest. This is kindergarden mathematics.For example if the wealthier people buy up houses and aprtments as investments and rent them out then prices go up and people rent more and more.
If someone owns an apartment and rents it then no one else can own it too. There is no creation of wealth issue, there are actual assets, who owns them, and who does not. You can have all the business transactions you want but in the end who owns what determines wealth and poverty.
Other than that there is the day to day use of money like when people spend all of their wages. This part is not relevant though because it is not about buying assets to keep.
So when you look at all the owned assets in the US the top percentages own a large amount that is climbing rapidly. The economy is also growing but since the wealthy percentage is growing their ownership is growing faster than other peoples.
This works out ok as long as the rest of the assets is enough for the other 90%, and if the economy keeps growing. The systekm though can work like a casino there a smaller group has natural advantages and keep getter richer and richer like on a casino wheel.
The rest of the population manages but when there is a recession the growth is gone and the lack of assets is suddenly obvious.
In cases like these there is plenty of money to borrow and places to rent, because these are owned by the wealthy. Actually getting to own these things is harder because the system is assisting the wealthy to make more, not to help you get some.
You might be lucky but the odds are against it.
Nice attempt at backtracking on the ludicrously ignorant statements above, but you’ve already dug your hole.