Trickling Trouble
Trickle Down Economics (TDE) was the infamous economic plan adopted by the Reagan administration in the 1980’s. Though TDE is not a defined term, from context it is clearly intended to be an economic system where there is no significant barrier to the amassing of wealth by individuals.
TDE comes from the old story that "if the horse has better hay to eat, the birds will eat better" (it being understood that birds eat manure). Reaganomics, to suggest one example, says that if the rich do well, benefits will "trickle down" to the rest. Also, lower taxes on high income or capital gains will profit most of the population, etc. Although there is conclusive evidence that this economic system is not working, more so because no one stands to earn more from this system than the rich, the Bush administration and the Republican Party still hold to its theory like scripture, mostly because they are in bed with the corporations themselves.
What most of this boils down to is that the rich have the capital not the poor, and our tax system benefits no one more than the rich, because the more you make, the more you get back. Not only so, but tax incentives for many wealthy corporations reaches into the hundreds of billions of dollars. Even Bush’s recent energy bill can attest to that.
Early estimates of the complex and convoluted bill by watchdog groups - such as the U.S. Public Interest Research Group or Friends of the Earth - suggest that more than $20 billion in public subsidies or tax incentives will go to conventional energy sources, while renewable and alternative sources will get just $5.3 billion (www.uspolitics.about.com).
All the hoopla aside, the energy bill that President Bush signed into law in Albuquerque is another sucker punch to American consumers and taxpayers
If anything, TDE should be called Circular Economics. The poor and middle class work heavy work loads, make billions of dollars for the corporations, and receive nominal pay. Then the government heavily taxes them and gives the money back to the corporations. All of this leads to one conclusion: the rich being richer and the poor being poorer.
On a side note, Hurricane Katrina did more than just expose a weak American infrastructure; it exposed just how bad economic conditions have become for many Americans and how vast the divide is between the rich and the poor. Surely you’ve heard journalists compare conditions in Louisiana to those of third world countries. The fact is that wealth is not trickling down, even though the lower and middle classes continue to work longer hours, and receive less pay in order to make corporations wealthier, even while a Bush administration boasts that we’ve been in economic recovery for the past three years.
As David Kamin, economic research analyst for the Center on Budget and Policy Priorities, reports, “The data show that the share of real income growth that has gone to wages and salaries (that is, the total increase in wage and salary income) has been smaller than during any other post-World War II recovery period, while the share of real income growth that has gone to corporate profits has been larger than during all other post-World War II recoveries (www.cbpp.org).
An even staggering rate is that in the first half of 2005, some 51.7 percent of national income went to wages and salaries, down from 54.5 percent when the recovery began. This is the lowest share on record. According to Kamin, a one percentage point difference in income share amounts to $102 billion. Therefore, this 2.7 percentage point decline is equivalent to $278 billion. That is $278 billion no longer in the American worker’s pocket. These phenomenal losses can mean the difference between putting your child through college and eating Top Roman.
However, the Bush administration always tries to paint the picture that everything is alright. Three years of economic growth following the 2001 recession have not improved the economic circumstances of low- and middle-income Americans, who have seen increases in poverty, declines in income, and increases in the ranks of the uninsured. The economy’s performance in 2004 alone stands in contrast to prior economic recoveries. Statements by the Administration counseling that all is well in the economy cannot mask the unfortunate reality that the current recovery continues to leave millions of Americans behind.
Again, to be frank, wealth is not trickling down to low- and middle-income Americans.
As if this wasn’t bad enough for the overworked and underpaid American worker, there is still the matter of the troubling and economically draining Iraq war. Many of the monies that should be going to programs designed to strengthen the U.S. economy and its infrastructure are being diverted to Iraq. To note, Congress approved the Bush Administration April 2005 request of $80 billion more for a third year of US spending, bringing total US expenditures through 2006 to almost $300 billion for war efforts in Iraq. What is even worse is that $9 billion of this have been lost in Iraq. This means that there is no public record as to where the money went. That is money that could have been paid to the Army Corpse of Engineers to strengthen levees in Louisiana, to the relief efforts in Louisiana, to drowning U.S. school districts to help fund No Child Left Behind, to Social Security, to the debt, to Medicare, to raising minimum wage, etc. Instead, an irresponsible Bush administration and Congress is throwing our hard earned, taxpaying dollars literally out the window.
To boot, it’s now a matter of public record that the Pentagon withheld information about the Bush administration’s no bid contract winner, Halliburton, overcharging U.S. taxpayers $108 million. If this isn’t proof that our government is in bed with corporations, than I don’t know what is. Furthermore, at the same time Halliburton was literally ripping us off and the pentagon knew about it, the Bush administration was cutting overtime pay from underpaid federal employees. Is any of this getting through to the American people? Are we that happy and wealthy, and fat that we fail to realize the impact of all of this in our daily lives?
Here’s an even worse statistic to end with, as if things are not bad enough; World Bank and CPA estimate Iraqi reconstruction needs at $55,259,000,000, most for which American taxpayers will be responsible (www.usliberals.about.com). American corporations look forward to the rebuilding efforts in Iraq, mostly because they will receive the government contracts to do it. However, that is American taxpayer money that will be going to corporations working overseas, and thus, will never trickle down through the economy to the American worker.
TDE comes from the old story that "if the horse has better hay to eat, the birds will eat better" (it being understood that birds eat manure). Reaganomics, to suggest one example, says that if the rich do well, benefits will "trickle down" to the rest. Also, lower taxes on high income or capital gains will profit most of the population, etc. Although there is conclusive evidence that this economic system is not working, more so because no one stands to earn more from this system than the rich, the Bush administration and the Republican Party still hold to its theory like scripture, mostly because they are in bed with the corporations themselves.
What most of this boils down to is that the rich have the capital not the poor, and our tax system benefits no one more than the rich, because the more you make, the more you get back. Not only so, but tax incentives for many wealthy corporations reaches into the hundreds of billions of dollars. Even Bush’s recent energy bill can attest to that.
Early estimates of the complex and convoluted bill by watchdog groups - such as the U.S. Public Interest Research Group or Friends of the Earth - suggest that more than $20 billion in public subsidies or tax incentives will go to conventional energy sources, while renewable and alternative sources will get just $5.3 billion (www.uspolitics.about.com).
All the hoopla aside, the energy bill that President Bush signed into law in Albuquerque is another sucker punch to American consumers and taxpayers
If anything, TDE should be called Circular Economics. The poor and middle class work heavy work loads, make billions of dollars for the corporations, and receive nominal pay. Then the government heavily taxes them and gives the money back to the corporations. All of this leads to one conclusion: the rich being richer and the poor being poorer.
On a side note, Hurricane Katrina did more than just expose a weak American infrastructure; it exposed just how bad economic conditions have become for many Americans and how vast the divide is between the rich and the poor. Surely you’ve heard journalists compare conditions in Louisiana to those of third world countries. The fact is that wealth is not trickling down, even though the lower and middle classes continue to work longer hours, and receive less pay in order to make corporations wealthier, even while a Bush administration boasts that we’ve been in economic recovery for the past three years.
As David Kamin, economic research analyst for the Center on Budget and Policy Priorities, reports, “The data show that the share of real income growth that has gone to wages and salaries (that is, the total increase in wage and salary income) has been smaller than during any other post-World War II recovery period, while the share of real income growth that has gone to corporate profits has been larger than during all other post-World War II recoveries (www.cbpp.org).
An even staggering rate is that in the first half of 2005, some 51.7 percent of national income went to wages and salaries, down from 54.5 percent when the recovery began. This is the lowest share on record. According to Kamin, a one percentage point difference in income share amounts to $102 billion. Therefore, this 2.7 percentage point decline is equivalent to $278 billion. That is $278 billion no longer in the American worker’s pocket. These phenomenal losses can mean the difference between putting your child through college and eating Top Roman.
However, the Bush administration always tries to paint the picture that everything is alright. Three years of economic growth following the 2001 recession have not improved the economic circumstances of low- and middle-income Americans, who have seen increases in poverty, declines in income, and increases in the ranks of the uninsured. The economy’s performance in 2004 alone stands in contrast to prior economic recoveries. Statements by the Administration counseling that all is well in the economy cannot mask the unfortunate reality that the current recovery continues to leave millions of Americans behind.
Again, to be frank, wealth is not trickling down to low- and middle-income Americans.
As if this wasn’t bad enough for the overworked and underpaid American worker, there is still the matter of the troubling and economically draining Iraq war. Many of the monies that should be going to programs designed to strengthen the U.S. economy and its infrastructure are being diverted to Iraq. To note, Congress approved the Bush Administration April 2005 request of $80 billion more for a third year of US spending, bringing total US expenditures through 2006 to almost $300 billion for war efforts in Iraq. What is even worse is that $9 billion of this have been lost in Iraq. This means that there is no public record as to where the money went. That is money that could have been paid to the Army Corpse of Engineers to strengthen levees in Louisiana, to the relief efforts in Louisiana, to drowning U.S. school districts to help fund No Child Left Behind, to Social Security, to the debt, to Medicare, to raising minimum wage, etc. Instead, an irresponsible Bush administration and Congress is throwing our hard earned, taxpaying dollars literally out the window.
To boot, it’s now a matter of public record that the Pentagon withheld information about the Bush administration’s no bid contract winner, Halliburton, overcharging U.S. taxpayers $108 million. If this isn’t proof that our government is in bed with corporations, than I don’t know what is. Furthermore, at the same time Halliburton was literally ripping us off and the pentagon knew about it, the Bush administration was cutting overtime pay from underpaid federal employees. Is any of this getting through to the American people? Are we that happy and wealthy, and fat that we fail to realize the impact of all of this in our daily lives?
Here’s an even worse statistic to end with, as if things are not bad enough; World Bank and CPA estimate Iraqi reconstruction needs at $55,259,000,000, most for which American taxpayers will be responsible (www.usliberals.about.com). American corporations look forward to the rebuilding efforts in Iraq, mostly because they will receive the government contracts to do it. However, that is American taxpayer money that will be going to corporations working overseas, and thus, will never trickle down through the economy to the American worker.
posted by Caleab at 4:39 PM
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