He always said that his goal was to bankrupt the United States. Well, MISSION ACCOMPLISHED!
We’re caught in a vicious cycle, thanks to the Bush approach to economics. Losing 8 million jobs has had such a profound impact, that most people can’t even grasp the big picture anymore.
See, when people aren’t working, two major things happen; they’re not earning taxable income, which lowers the amount of money that both states and the feds are collecting, and they’re not putting money into the economy, which costs more jobs.
I’m about to debunk two lame ass republican mantras; “trickle down economics” and “the government can’t create jobs”.
Let’s start with the latter. Last week, republicans were up in arms over the federal jobs bill which included 26 billion dollars for school funding. That 26 billion is supposed to save over 160,000 teachers from losing their jobs so naturally, we’re all supposed to hate the free loading teachers now. Actually, that’s not true. We’ve always hated the teachers because they have the audacity to join labor unions, but that’s a topic for another post. The one thing that Fox and the republicans didn’t tell you, is that those funds were paid for. They weren’t an “emergency” supplemental a la Bush, and they weren’t off budget funds. They were paid for.
So let’s look at the impact of those teachers on the economy. I’m going to use my city of New York as an example because well, it’s my city!
New Yorkers are currently talking about yet another impending increase in subway fares. This is BIG deal for us, because we don’t drive cars. The subway is how we get around. The proposal on the table right now would increase the monthly cost by 16%. That’s a huge increase. We’ve been getting a minimum of 10% increases every year for the past 4 years. The MTA (transit authority) is facing major shortfalls (as they always are), so they’re cutting services and increasing fares.
Back to the teachers. Some of the shortfalls that state and city run services are facing are due to unemployment rates. When New Yorkers aren’t working, they’re not paying New York city taxes (yes America, we pay city, state, and federal taxes here so QUIT your whining!). In addition to not paying taxes, they’re not using some services, and using the shit of other services. Services that cost money see shrinking revenues. Unemployed people don’t buy $89 unlimited Metro cards. They buy single ride cards because they’re not leaving the house every day. With less people riding the trains, those shortfalls increase exponentially. So if New York city saves 5,000 teaching jobs as a result of those federal funds, it’s good for us in more ways than most people can even conceive of.
When 5,000 teachers are spared from the fate of unemployment, some number of MTA employees are also saved because those fares help to mitigate the budget shortfalls.
This applies to a myriad of different service jobs. Every $1 that those 161,000 teachers spend on food creates $1.71 in economic activity. “Economic activity” includes the jobs of the people picking (or processing) the food, the truck drivers delivering the food, the gas station owners filling up the trucks with gas, the store employees stocking the shelves, etc. You see how the list goes on and on, far beyond what most people think about.
If those teachers were unemployed, they would be spending less, thereby causing more unemployment. And that impact wouldn’t be limited to the state they live in. Yes, unemployed NYC teachers hurt the state of New York, but they also hurt economic activity in several other states. How is this not obvious to everyone?
Anybody who says that the government can’t create jobs is just plain ignorant. Republicans that say it are just lying. All they have to do to prove that government creates lots of jobs, it to look at the Reagan presidency. The Reagan years were eight straight years of stimulus spending. He jacked up record deficits so that he could spend wildly on defense. He pumped hundreds of billions of dollars onto the pockets of the defense industry. That investment is still creating jobs today. All of that defense money Reagan spent ultimately led to the silicon valley boom. Hundreds of billions of dollars being thrown at R&D in defense, shrank the microchip down to a size that made the personal computer possible. Yes, we would unquestionably have gotten there eventually, but the “Reagan stimulus” greatly sped up the pace.
So yes, government does create jobs. Lots of jobs because money doesn’t trickle down, it flows up.
Poor people are the ones that actually create jobs. No, I’m not crazy. Just stay with me. Those 161,000 teachers that make between $25,000 and $50,000 a year are actually the backbone of our economy because they spend every cent of what they earn, which creates economic activity. People who make more generally save some of their money. They defer some of their income into 401k accounts and open up savings accounts.
People that make a lot more invest their money. They invest their money in ways that will maximize a return on their investment. They invest in companies that will pay out high dividends. How does a company get into a position of paying out high dividends? By maximizing profits by any means necessary. Historically, this is accomplished by paying less for goods and labor. This means offshoring jobs and buying supplies from Chinese manufacturers that can offer those supplies at a much lower rate than a US manufacturer can.
Companies don’t have an imperative to create jobs. They have an imperative to create money, which is why “trickle down” is total bullshit. Very little actually trickles down. In fact, every $1 in tax cuts to corporations creates 32 cents in economic activity. The other 68 cents ends up either in a Swiss bank account or at a manufacturing plant in China.
Republican ideology is giving Bin Laden his wish. Every cent of stimulus spending they choke off is accelerating the pace for the bankrupting of the United States.
States all across the country are removing street lamps, or just turning them off at night. How’s that going to work out for your city’s crime rate? And as states are running out of money, they’re also cutting state jobs like policemen and firefighters. Good luck with getting help on those dark streets. Another charming development is that we’re devolving from using asphalt on our roads, back to gravel because it’s cheaper. Seriously, we’re going to be driving on dirt roads soon. Our roads are literally crumbling, our cities are getting darker, and our infrastructure is falling apart.
Two key measures of the development of a country are its infrastructure and its education system. We’re moving backwards in both of those areas. Thanks republicans!
Your sudden interest in fiscal conservatism is as ass backward as your knowledge of world politics. If we don’t invest a lot of money in our country right now, we’re either going to give Bin Laden his wish, or we’re going to spend a lot more later. And by “later”, I mean a couple of years.
Nevada is a few months away from not being able to pay its municipal bonds. Florida, Arizona, California, and Wyoming aren’t far behind. Where do you think they’re going to turn to bail them out?
The federal government can spend money to create jobs now, or they’re going to be forced to throw a lot more money at the problem later. Homeowners know that if you don’t spend a dime on maintenance for ten years, you’re going to have to spend a lot more to rebuild portions of your house later.
We are letting our country fall apart, and we’re giving Bin Laden his wish. Anytime some asshat talks to you about “trickle down” or the evils of stimulus spending, just let them know that Bin Laden appreciates their hard work. He can’t do it without them.
