Let’s take a brief look at what got the U.S. economy to this point. In January of 2001, the federal government was sitting on an approximate 200 billion dollar budget surplus. This was there because of strong and bold leadership by President Clinton for the last 4 years of his administration. He had to reverse all the deep damage inflicted on the U.S. economy by the totally bone-headed moves by the Reagan administration from 1980 to 1988. Reagan really did this guide this economy into the deep abyss that lasted until Clinton stood up the Newtie led republicans in Congress and changed the path. He did this by an intelligent combination of cuts and revenue enhancements…balanced! Once Dubya came into office, the influence of the now strengthening “owners” became clear. Claiming a surplus is a result of over-taxation, Dubya shoved an ill-advised and more importantly, an unfunded tax cut through. That act in itself dissolved every cent of the surplus, and began the growth of long term deficits! He followed that stupid act with an invasion of a harmless sovereign state, Iraq. Cheeney claimed we’d be in and out and the proceeds from hijacking the Iraqi’s oil would pay for the whole thing. Therefore, there was no funding mechanism in place to pay for this savage occupation of Iraq. Well, as most intelligent Americans knew, there never was proceeds from the oil, only trillions of unfunded dollars spent on a lie, not to mention the hundreds of thousands of human kills and permanent disabilities. As an afterthought, Dubya sent us into Afghanistan without setting up funding for that war. More trillions of dollars added to the debt and deficit! Dubya followed those stupid manuevers with another act of lunacy with a second unfunded tax cut in 2003. Can you see the influence of the “owners” taking hold of the federal government? This move, by all estimates from knowledgable economists added yet another trillion some dollars to the deficit. And then, for good measure, in a purely political move for the 2004 election, Dubya pushed through the unfunded Medicare prescription bill act. Another move that added several hundred billion dollars to the deficit. Those move, combined with the lower tax revenues left the government with a 1.43 trillion dollar deficit at the end of Bush’s Presidency. In his last act, to say “fuck you America”, he shoved through this 3 page document known as TARP, an 800 billion dollar gift to Wall Street. As you can well understand, a three page document of gift bill, couldn’t go far enough to make accountability a part of the bill. So as everyone with brains knew, the fat cats on Wall Street pocketed the money for their own use to spend, lavish vacations, million dollar office renovations, and payouts of huge bonuses for failed performance. It’s a good thing Eric Holder went after all of those thieves and recovered the money! Apparently, Holder didn’t get the message from the “owners”!
Fast forward to August 2, 2011. Washington DC showed it’s total lack of any leadership in the total failure of the debt ceiling increase. President Obama completely ran away from it as soon as the Tea-Baggers flexed their muscle. The really sad thing though was watching Speaker Boner and Senate Minority Leader McChinless also whither and shrink from the loud mouths in the Tea-Bagger caucus. That whole exercise of watching the “owner” controlled Tea-Baggers dictate the legislative obstruction on these issues was disgusting. What we saw was how governance will be done in this country from this point on unless the leadership problem is addressed.
The next point of failure is the selections to the so-called “super committee” on the budget. First off, the formation of another committee is pointless. Congress already has committees to deal with matters of the economy. To make it even more senseless, look at the appointees on the republican side. Everyone of them signed the asinine and infantile Norquist no tax pledge, that renders this committee moot. Everyone knows that correcting the problems of the economy be addressed at all angles! So, here comes yet another political gridlock. The only way to get the ball rolling on these issues of the economy is to have the President grow some balls and start acting like a chief executive. He needs to realize the republicans don’t like him in the least nor will they do anything with him to advance his agenda. Non-partisan legislation and governance is not working so it’s time for the President to go to the Lyndon Johnson playbook.
The fix has to work in this order, tax reform then government led job creation, followed by the hope of private sector job creation, deep and very severe cuts to the defense budget, and a streamlining of Medicare and Medic-Aid. The only changes needed for Social Security is the government needs to repay what it owes the fund and then from this point forward stop borrowing from it. Social Security is a self-operating entity funded by our money, not government money.
The steps needed for tax reform are very simple but will quickly pay billions in economic recovery! First, the tax code needs to be totally scrapped! There have been so many additions to fit special interests to it over the decades it’s just become too cumbersome. A simple set of tax rules will be a graduated rate system, starting with zero taxation on people working beneath the poverty level as determined by the government. The rates will then rise as tax payers income rises. As a person or company rises through the levels, they only pay the higher rate on the amount earned above the previous lower rate. The only necessary deductions for tax payers are for personal home mortgages and loans for paying for college education. All loop holes must disappear. Every person and entity pays their fair share, no exceptions. Companies and businesses may earn tax credits for company expansion and adding employees to payrolls. These are credits that must be earned and accounted for. Companies must perform the expansion and additional hiring first before applying for tax credits. Companies or individuals caught “hiding” income overseas earned from American business, will be severely penalized and ordered to bring the money earned in America back to America. By closing tax loop holes, simplifying the tax system, catching and penalizing tax cheaters, the rates for everyone and every business will be lower because of the increased revenue rates.
To jump-start the economy, the government needs to create a jobs program. The infrastructure of the country is in a shambles. The stimulus bill passed last year only scratched the surface. As a cave in to the republicans, the bill was weighted way to heavily to tax cuts rather than preparing a program for work projects to get people to work and get the private sector participating in the work to improve the lot and life of Americans. As China keeps blowing past the U.S. with massive expenditures on its infrastructure, high-speed rail, high-speed communications, and education of its population, the U.S. keeps sliding backward because of petty politics. The government needs to take the lead in this area because the private sector has shown no interest or inclination to expand and add to payrolls, in fact, despite record profits, they are still laying workers off! The Reagan and Bush tax cut failures are classic examples that unaccounted for tax cuts do nothing to improve or grow business. Documentation shows the top 3% of income earners not only don’t spend the tax sourced extra money on their business, they simply apply it to the bottom line profits and bank it. It’s a fact, indisputable!
The hope being that government initiated work projects eventually will knock the private sector off their fat asses and join in the process which is the right thing to do. Not only is it patriotic, but in the long run it will pay off financially for them. Remember, in the ’50’s under republican President Eisenhower, the country operated quite successfully under a top marginal tax rate of 92%! Not only was the economy strong, but the backbone of the country, it’s infrastructure was grown, renewed, and added to. Under Bill Clinton’s presidency, America suffered under that onerous and oppressive top tax rate of 39%. The result, a total reversal of the negative slide Reagan put the country into and a record eight year growth in the economy and a 200 billion dollar budget surplus! How can anyone dispute these facts? They are, after all, FACTS!
In conclusion, the President needs to become a strong leader ala LBJ, needs to start dictating what the course of action is going to be and not cave into the republicans who will continue on their path of the destruction of the Presidency of Barack Obama! President Obama needs to get word to Congress he will be bringing to them his plan for the economy. He must not accept anything from the Democrats or republicans on the Hill. The days of compromise are over. It’s time to start the political strong-arming and the threats. How do sensible people think FDR, Truman, Ike, JFK, Nixon, Clinton, and mostly LBJ got things done in Washington? They were powerful and flexed their strength where needed. The republicans have no interest in bi-partisan governance, in fact, they have no interest in governance at all. The ONLY thing they have done since coming into power in the House in January is the wildly out of touch Ryan Bill proposal, which has proven out to be a job killer, and legislation that works against middle America and the poor. It’s solely an order from the “owners” to keep suppressing the masses and expand the strength and wealth of the top 3%. Other than this failed piece of proposed legislation, all we’ve gotten from them are anti-woman, ant-gay, anti-poor, and anti-immigrant legislative proposals! Let’s us all know who the true constituents are of the republicans in elective office.
Thanks for today’s read and I look forward to reading your comments.