I know many Americans hate progress, change, liberals, equality and workers, but it still surprises me when I see so many regular folks fight so hard to protect wealthy executives and corporations.
I wonder if CEOs for big pharma and health insurance companies sit around drinking scotch and laughing their asses off watching YouTube videos of all the boobs rallying to protect their positions of power.
I mean think about it, the Tea Partiers fought tooth and nail to protect health insurance companies so they can deny them – the protesters – health care, to take away their health care when they need it and to bankrupt them when they get sick.
It makes no sense.
And who do we have to thank for this mind-boggling insanity? President Ronald Reagan. It wasn’t so much the man as it was the time. Reagan, like all presidents, don’t create movements but they ride them.
The 1980s was the “Me Decade.” It was a time when the Baby Boomers were coming of age and they wanted, not just their slice, but the entire American pie. It was a decade plagued with un-checked greed and individualism. Either you were a Gordon Gekko, you wanted to be him or at the very least respected his tenacity and ruthlessness.
The last thing we needed was government intervention and taxes to slow down our quest for all of the money in the world.
There’s no doubt that this anti-government sentiment was rooted in the 1960s and 1970s when the government was doing some pretty horrible things. We had the Vietnam war and we lost. We had Watergate and we lost again. We did get civil rights legislation and Medicare, but the GOP successfully leveraged that as part of its “southern strategy.”
Animosity towards the government was strong on both sides of our political spectrum, and so when Reagan came in saying that it’s “morning in America,” people liked it.
Taxes for the wealthy were slashed and slashed and slashed again. Banking regulation was relegated to the garbage heap. We didn’t want to pay taxes, we wanted voodoo economics.
The idea behind voodoo economics was that by reducing government spending (that didn’t happen), reducing taxes (that did happen), reducing regulation (that happened) and controlling inflation (see Federal Reserve) the wealthy would get so rich some of that money would trickle down to the workers.
That’s called a top-down approach to economics – make the rich really rich and we all benefit. The problem is that it didn’t work.
What happened is that income inequality skyrocketed. While the rich were paying less in taxes, government spending wasn’t reduced and therefore deficits went up and the burden was placed squarely on the shoulders of the middle class. The money did trickle down. It trickled a little here and a little there, but unfortunately, trickle-down economics is just that – a trickle.
And so for the last 30 years, the rich got really rich and the rest of Americans were left with bailing out the Saving and Loans institutions that failed in the ’80s, the hedge fund debacle in the ’90s and the most recent Wall Street bankers who ushered in the Great Recession.
History should be our guide to economic and tax policy. When the rich don’t pay their fair share, like they didn’t in the “Roaring Twenties” which lead to the Great Depression. While we were under the spell of voodoo economics, we all suffered the consequences with the Great Recession. We can’t have an economic system that encourages economic inequality.
You see, one of the fundamental components of a tax system is to distribute the wealth. Either wealth goes up to the rich or down to the masses. Under Reaganomics it went up. Wealth redistribution is not socialism. It’s not communism. It’s how taxation works. And as a society we have to decide who should get the money – the wealthy or the rest of us.
A progressive taxation system is a bottom-up approach. It’s a belief that the real economic engine of this country isn’t the 1 percent of us who are wealthy, but the 99 percent who aren’t. If we have money, we buy a new car every couple of years. We buy new clothes. We go out to dinner. We go on a vacation with our family. The richest among us already do those things regardless of their tax burden, but the rest of us don’t.
It’s the workers of this nation that make this economy strong. When we have money, we spend it.
But the tide is changing. Americans have realized that slashing taxes on the wealthy doesn’t lead to economic prosperity but just the opposite. And when President Obama signed health care reform into law yesterday, he was saying that he supports the workers – the middle class. He said it’s time for the wealthy to start paying their fair share.
Now Obama needs to repeal the Bush tax cuts and then some. What America needs is a return to a progressive tax system and an end to laissez-faire government regulation of our financial system. Obama has a lot of work to do, because Americans don’t want voodoo economics anymore, but those who control the wealth and the GOP surely do, and they’ll stop at nothing to keep things as unfair as possible.