Tuesday, February 14, 2012

Creating Jobs

30 million Americans are out of work. 30 million people who need money to pay the rent and buy food. 30 million people living lives of uncertainty and stress.

What is being done?

The Democrats and Republicans promise to "create jobs".

How? By cutting taxes on the rich, by removing what they refer to as burdensome regulations, by giving tax breaks and incentives to giant corporations, and by telling Americans to borrow money and open small businesses.

For 30 years, Congress and the President have cut taxes on the rich. How's that working out for us?

Between 1985 and 2008, the wealthiest 400 Americans saw the percentage of their income paid in federal income taxes drop from 29 percent to 18 percent, according to data from the Internal Revenue Service.

What did they do with the money? In the 80s, they bought out other businesses, especially the well-run, family owned small businesses that Americans are told we value. With leveraged buy-outs and hostile takeovers, companies that made profits and had employee pension funds were bought out, their workers fired, their pension funds stolen, and their profits turned to debt. As it happens, profits are taxed and debt is tax deductible.

In 1955, corporations paid 27.3% of the Federal revenue. In 2010, they paid 8.9%. The GAO reported in 2008 that “two out of every three United States corporations paid no federal income taxes from 1998 through 2005".

The rich also bought mansions, jets and yachts and went on an orgy of luxury spending on restaurants, art and jewelry. And, of course, Savings and Loan corporations, which were released from burdensome regulation in the 80s, and promptly became opportunities for criminal fraud and money laundering.

The rest of us became steadily more impoverished. Wages have not risen in real terms since 1974. The working class, who couldn't buy savings and loan corporations, turned to borrowing money to make up for the loss of wages. So the rich, who were paying less in wages and taxes, ended up loaning, at interest, the money that they were no longer paying for labor.

In 2001, the politicians told us that tax cuts would create more jobs, and the rate was lowered even further. The result?

50,000 factories in the US have closed in the last 10 years and corporations have laid off 10 million more American workers. The very wealthy are now so rich that they are sitting on almost two trillion dollars, unable to invest it in any productive enterprise. It should be very obvious that lowering corporate income taxes does not increase employment, especially since corporate payrolls are tax deductible. They subtract workers wages BEFORE they figure taxes, so how could lowering taxes inspire them to create jobs?

In 1955, individuals paid 58% of the federal taxes. In 2010, we paid 81.5%. But the rich are demanding that we pay even more.

What are the burdensome regulations that the corporations decry?

The most burdensome regulations are those placed upon small businesses, to benefit multi-national corporations. Not content with 98% of the market, they try to drive the surviving smaller enterprises out of business, by demanding rules that are costly for ordinary people to follow. Here's a tip on how to tell actual burdensome regulations - if large corporations have exemptions, and only small businesses must follow them- they are burdensome.

Obama's administration signed the ACTA treaty, a very burdensome regulation. Obama's Justice Department is ignoring the banking frauds of the last ten years, (unlike in the 80s, when 1200 bankers went to prison for their crimes), while going after small legal marijuana growers in California and Colorado. When Obama promises to get rid of regulations, he means the environmental laws, the worker safety laws, the health laws and other protections that Americans worked so hard to enact in the past.

The corporate politicians also want to get people borrowing money to invest in small businesses. Let's remember what FDR said about the bankers pleas to get people to borrow more money after the Roaring 20s bubble burst - "Faced by failure of credit they have proposed only the lending of more money.Stripped of the lure of profit by which to induce our people to follow their false leadership, they have resorted to exhortations, pleading tearfully for restored confidence. " Faced by a failure of credit, Obama urges more. Students, having noticed that young people are graduating from college with massive debt and no jobs, are reluctant to participate. Obama tells them that reforms will make things less burdensome. Go ahead and borrow more to get that degree! Jobless Americans are told to follow their dreams, borrow money and open that small business they've always dreamed of.

What goods or services are 30 million Americans supposed to provide? The US produces far more food than anyone can eat, millions of houses have been built and sit empty, the store shelves are full of products. Increases in productivity, coupled with automation, computers and robots, have made it possible to produce an abundance without much human labor. What more do we need?

Well, although we produce enough food to feed most of the world, some of our people go hungry. Although brand new houses sit empty, we have millions of people who are homeless, or living with friends and relatives. The goods sit on the store shelves because people can't afford to buy them.

Abraham Lincoln is quoted as having said, "As long as there is one unemployed workingman, the hours of labor are too long".

To people fresh off the farms in the 1800s, the answer to unemployment was obvious. Share the labor and the hours will be cut for everyone.

We have 30 million unemployed workers, and 160 million workers who work more hours a week than any other country, with fewer holidays and vacations. The obvious thing to do is to hire more people and have the others work fewer hours. Wages would have to be raised, of course, and the rich would have to give up the 2 trillion dollars they can't invest.

What else does this country need? A lot of the houses that people actually live in need repair, and insulation. Our cities have crumbling areas. We need more light rail for transportation. Our children need education. We need health care. We need sustainable energy. We need to make goods here instead of importing them from thousands of miles away.

Why is it that we have 30 million unemployed people and so many needs go unmet?

There is no profit in meeting these needs. If there is no profit, there will be no business plan that involves meeting needs.

Why can't we, the people, get together and form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity?

Relying on corporations to provide us with jobs, and banks to provide us with money, has gotten us mass unemployment and a deindustrialized nation.

The way money is introduced into the economy today is by banks creating debt. Therefore, when people quit borrowing, the money supply shrinks and the economy collapses. As the economy collapses, more and more people lose their jobs, and very few people are willing to go into debt, no matter how much the politicians exhort them to.

Dennis Kucinich has proposed a bill in which the Congress takes back its power to coin money, as stated in the Constitution, Article 1, Section 8.

The Congress can create money to spend into circulation, by paying workers to do useful work, and by investing in productive enterprises. The retirement age can be lowered, opening up many opportunities for work for our younger generation. Maternity leave can be given, as is in almost every other country in the world, except for Swaziland and Papau New Guinea. And the United States. Health care can be nationalized, taking the profit out of the health care system, and having dollars spent directly to care for the sick, the injured and the elderly.

The corporate politicians tell us that money can't be created, that all debt must be repaid, that creating money would be inflationary.

And yet, the audit of the Federal Reserve told us that 16 TRILLION dollars was created in the last two years to give to Wall Street and the bankers.

They can create 16 trillion dollars, without fanfare or debate, to give to the 1%, and yet, they are laying off teachers and firefighters, closing schools and hospitals, threatening to cut Social Security and Medicare?

The class war of the last 30 years has been one-sided, and our side is reeling, as Warren Buffet points out. The corporate media and politicians tell us we can't fight back. They tell us it's too divisive.

While the militarized police attack unarmed students and protesters, and 4,000 people have been arrested since September for protesting corporate rule, not one banker has been arrested for fraud, perjury, insider trading or theft.

If elected, I promise to fight on our side of the class war. I promise to vote against austerity measures and for a new monetary policy. I promise to vote against perpetual wars and occupations, and for investment in America. I promise to vote against more prisons, and for repeal of the Patriot Act and other oppressive laws passed in the last decades. I promise to keep our National Parks, and our environmental laws. I promise to protect all labor law, except for the Taft-Hartley Act.


Anonymous said...

You may find my January 29, 2012 post in my blog "Constituent in the Ointment" interesting. If you do, please leave a comment.

kdog said...

We need more excellent articles like this. The smoke of a 'Recovery' continues to be blown up our collective asses. We need reality based articles like yours.

Go Wage Laborer !!

Poor America

The Poor America video also documents what is really going on. The answer as your documentation of tax rates in your article shows appears to be to take from the poor and give to the rich. Same as it has been for thirty years.

Newt Gingrich even advocates a return to child labor.

The right became the middle and the middle became the left. What was the right is now madness. What was the left is now extinct.

Madness rules the land.

chrisroy said...

K-dog is right; we do need more correct diatribes i hope to see you back soon at the clusterfuck, as it has been very right wingy lately

Anonymous said...

ozone hollers over:

What's a distraught job destroyer to do?? The profits are getting tougher to squeeze from the proles!

(We're missing your hollering over yonder in the nation of clusterous fuckers; funny what you get used to, eh?)

I'll try to send you a fine ditty that I know you'll enjoy, if'n you didn't h'yar it already.
Here we go; uh-uh-ohhh:

neeraj.p. said...

It took me time to read all the tips, but I clearly loved the post.
It proved to be very helpful to me and I’m certain to all of the commenters here!


neeraj.p. said...

It took me time to read all the tips, but I clearly loved the post.
It proved to be very helpful to me and I’m certain to all of the commenters here!