Tag Archives: government programs

We aren’t going broke and we ain’t broke (update)

Republicans have been trying to convince the American people that we don’t have any money. They have used the financial collapse of Wall Street to scare Americans into believing this tale. It is true that the average American is having problems paying his/her bills. That is because everything is going up except their salary. Wages have been flat or depressed for over 30 years. We (our government) have promoted policies which have allowed corporations to play a game of labor arbitrage, which has depressed our income and fattened the wallets of CEOs. We have showered big business with tax breaks and have done nothing to help the average worker. As a matter of fact, we have made it harder on the average Joe by deregulating almost everything and tearing up the economic safety net.

From EPI:

Incomes, on average, have grown substantially over the last three decades, both in absolute terms and per person. The good news is that projections show comparable income growth over the next three decades, too. The chart shows the annual levels of per capita income for 1980-2010 and 2010-40. Adjusting for inflation, per capita income was $28,684 in 1980, steadily increased to $47,737 by 2010, and is expected to rise to just over $75,000 by 2040. With this level of past and future income growth, we as a nation are not broke—governments can afford the investments and services we need, and employers can provide rising compensation to employees.

And we won’t be broke if we make appropriate choices. The future prosperity of the broad middle class hinges on the economic policies and structures that determine how this future income is generated and shared. For instance, federal and state governments certainly face deficits today, and those deficits are primarily the result of tax policies (Bush-era cuts for the wealthy) and the impact of the Great Recession (which will lessen with time). But with the per capita income growth over the next three decades projected to match that of the past three, we have the means to pay for the government programs we need, and should do so.

Update: I have a commenter focus on this post like a laser. He has had several thoughtful questions. I would just like to add that blotting government spending on one axis versus income on the other axis only reveals a part of the picture. We need to see more in order to truly evaluate if government spending is truly out of control. We need to look at GDP also. Anyway, I would like to point everyone to this nice paper by EPI. It explained that we aren’t broke and we can afford to pay workers more.

Grab bag Thursday

  • obama sotu 2010I was unable to watch the State of the Union address last night. (I was on call and somewhat busy.) I did watch it at about 3 AM. (I do love the Internet.) I’ve been watching State of the Union addresses for over 20 years and I can honestly say that I don’t like them. Any event that turns what are supposed to be dignified congressman into cheerleaders is a problem in my book. Whether it was Reagan, Clinton, Bush the Lesser or Obama, it seems like the purpose of the speeches are to tell us how great we are and gloss over our problems. Don’t we have FOX News for that?
  • Now, don’t misunderstand me. I think the President Barack Obama did a fabulous job. There was that one section that made me somewhat nauseated. “Starting in 2011, we are prepared to freeze government spending for three years. Spending related to our national security, Medicare Medicaid and Social Security will not be affected. But all other discretionary government programs will.” I won’t even get into the problem with discretionary versus “indiscretionary” spending. When 20% of our budget goes to national defense and 22% of our budget goes to Social Security and 12% goes to Medicare, there is a whole lot left over. We spend 7% of our budget just on interest. That’s over 60% of our budget. So, we’re going to hold spending on Head Start? Do we need to increase spending in order to increase demand until we are out of this recession?
  • Dr. George Tiller was gunned down while he was at church back in May of last year. His alleged killer is on trial now. Closing arguments begin tomorrow. In my mind, it doesn’t matter what Scott Roeder said on the stand. He’s never denied gunning down this man in cold blood. They should put him away and only let him out when the steel bars rust from age.
  • Nerves are raw everywhere in our country. Many liberals were calling for the replacement of Federal Reserve Chairman Ben Bernanke. After all, he did preside over the worst housing collapse in the history of our country. He ignored the warning signs. On the other hand, think about the backlash he would’ve received for standing up and crying wolf. Banks and financial institutions would have wanted to tar and feather him for calling an end to their party. I personally think he was a no lose – lose situation. In spite of the opposition, he won a second term.
  • Newly elected Virginia Republican Governor Bob McDonnell gave the Republican response to the State of the Union. Two things stand out in his rebuttal. “The circumstances of our times demand that we reconsider and restore the proper, limited role of government at every level.” So who decides what the proper and limited role of government is? The new governor? The president? Congress? How do we pay unemployment benefits to millions while we are dismantling government? Personally, I want government to be large enough to be effective while still small enough to be effective. Whatever that size is. That’s what I want. The governor earlier quoted Thomas Jefferson as saying, “a wise and frugal government which shall leave men free to regulate their own pursuits of industry… and shall not take from the mouth of labor the bread it has earned…” It sounds as if Thomas Jefferson was supporting the Republican cause for limited government. Unfortunately, the governor got the quote wrong. The full quote seems to support the government’s role in our society as a balance against big business. “Still one thing more, fellow-citizens — a wise and frugal Government, which shall restrain men from injuring one another, shall leave them otherwise free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned. This is the sum of good government, and this is necessary to close the circle of our felicities.” Did Governor Bob think that no one would look it up?
  • John and Elizabeth Edwards have split up. Just think, he was really close to becoming president. Doesn’t that send chills down your spine?
  • Housing foreclosures continue to rise.
  • JD Salinger, the author of the Catcher in the Rye, has died.
  • Finally, we’re preparing for our second snowstorm of the winter season. If you love snow, this is great. If you’re like me, snow is better when seen on a postcard. (Pssst… I was told before I moved here that it doesn’t snow that much. WRONG!!)

What happened to the truth?

Maybe I’m wrong but it sure seems like times have changed. At the risk of sounding like one of those old-timers in the movie Barbershop, it seems that words like integrity, honesty and truth have lost their meaning. As the two major parties clash over everything from healthcare to Afghanistan to global warming, it seems that they can’t even agree on the basic facts. We see this not just our leaders but everywhere around us. The other day when I was in my own barbershop, there was this older gentleman who had conspiracy theories involving the government, our preachers and, well, everybody. He had a lot to say. Unfortunately, a lot of what he had to say was devoid of facts. I don’t blame him. This is the way our society has been going for the last 30 years. Although “truthiness” (a term coined by Stephen Colbert which he defined as “truth that comes from the gut, not books.” In other words, stuff that we wish were true.) did not start with President Ronald Reagan, he brought it to the forefront. Former Speaker of the House Newt Gingrich, conservative columnist Ann Coulter and others have perfected this means of communication in which you start with something that is the truth and then segue into something that is almost true and end up with something that is completely false. To the unsuspecting observer, you made sense.

To say that the problems in the black community have been caused by the US government is laughable. Sure, maybe government programs like welfare did not help the black community, but it sure did not cause the problems with joblessness and lack of education and our youth growing up without fathers. It did not start with welfare or the Great Society. In The Philadelphia Negro, written back in 1897, W.E.B DuBois describes joblessness, black men fathering multiple kids and a lack of education in the black community. What we see now has been going on for over 100 years!

Do you remember August? The right wing was pushing several items that simply weren’t true. They told us that health-care legislation included death panels. There was no such thing in the legislation. They also told the elderly that, in order to save money, Democrats were trying to kill them off. This is simply a lie. I’m not saying that either the right or the left has a monopoly on truth. Neither side does but give me a break.

One of the common themes that heard over the last several years is that gay marriage will destroy the institution of marriage. I simply don’t understand this logic. I don’t know how somebody else who gets married – a man and a woman, a woman and a woman or a man and a man – I don’t know how they’re going to affect my marriage. Maybe it’s just me, but it seems that my marriage is mostly affected by me and my wife. I have a high likelihood of divorce if I forget my wife’s birthday or I buy her something ill-advised like a vacuum cleaner for our anniversary. I simply don’t see how gay marriage is going to affect it.

Finally, the new economic numbers came out for October. The economy still is not making jobs. Republicans have stood up and asked where are the jobs? This is a little gamesmanship being played by the Republicans. 190,000 jobs were lost last month, which is the lowest figure since the recession started. Any economist will tell you that business will need to start making money and feel good about their economic prospects before they begin hiring workers again. If people would like to criticize Obama’s economic plan, they should ask where are the jobs are going to come from? The lackluster Bush recovery was driven by the housing market. The housing market is currently problematic. New jobs are going to have to come from Obama’s green energy initiative.

I guess my point is that many people think that they know the answers to the ills of America. Most of our problems are complex and require a thoughtful solution. Anyone who gives you a knee-jerk answer to a complex question is probably leading you astray. There are definitive truths in our society. We just have to be willing to find them.