Tuesday, September 27, 2016

'COTW: The REAL Solution

The candidates spent a good part of their air time last time delivering well rehearsed messages on how to reinvigorate the domestic economy, sandwiched between zingers about unpaid contractors, tax audits, and classified material leaks. One wants to increase income taxes and the other wants to reduce them. Both are proposals that will benefit their vested interests--segments of the plutocracy, one corporate, the other inherited. Both proposals miss the mark as this chart so clearly demonstrates:

The American economy in the 21st century is still driven by consumer spending. Over 70% of GDP is accounted for by expenditures from what used to be the great middle classes, which now should be called the unwealthy, or perhaps the unworthy. If the politicos really want to rebuild America and not just trickle on the unwealthy, they should support economic proposals to put more money in their pockets. Corporations used to pay $1 out of every three in taxes. Now, corporations pay only $1 of every $9 collected by the federal government at a time when they have never been so profitable. "Increasing corporate income taxes will hurt job creation", you moan. NOT. Corporations will pass along modest increases in costs to their customers as they always have. Despite higher prices, consumers with more disposable income will buy more and thereby create demand for more product, causing businesses to expand. The government will be able to use the increased revenues to provide needed social programs and rebuild infrastructure. That is how it is supposed to work in a market economy. "Too late for this stage of capitalism", you eruditely complain? Perhaps, but it is worth a try, instead more failed economic policies from Regan's reign.