The upcoming election is all about jobs. No, it's all about taxes. No, it's all about debt. Well, I guess it depends on who you talk to. The Tea Partiers are all concerned about the debt and lowering taxes. That supposedly will produce more jobs. Only we've tried that for 10 years and it hasn't worked. Lowering taxes is not going to produce any jobs. That's been established. But that amounts to the Republicans' jobs program: lower taxes. Well, how does lower taxes - if it doesn't produce more jobs - affect the national debt. Well, the Republicans have a track record on that too. Lowering taxes increases the debt because there are less revenues coming into the Federal government. George Bush pretty much proved that. In fact the deficit - which is the yearly contribution to the debt - would by and large be eliminated if we just eliminated all the Bush tax cuts - those on the wealthy and those on the middle class.
So let's say we eliminate the Bush tax cuts on everyone. Problem solved at least as far as adding to the debt is concerned. Of course there are other ways of raising additional government revenues which would also eliminate the deficits. Problem is the government as presently constituted doesn't have the political will do do any of them. But one thing is for sure: you can't lower taxes and reduce the debt. And if lowering taxes doesn't produce more jobs, it seems like a no brainer to at least solve the debt problem by raising taxes, not necessarily on the middle class, but somewhere.
Thom Hartmann in his new book Rebooting the American Dream says this:
One way in which the think tanks and the conservative media con the American public is to conflate income taxes for the rich with income taxes for everyone else. And this is the crux of the con job. When Bill Clinton proposed tax increases in 1993, think tanks like Heritage and Cato immediately opposed them with their myths about the negative consequences of tax increases.
Those negative consequences would be a lack of job creation. But we've had low taxes and ... WHERE ARE THE JOBS??!! If job creation is not a consequence of lowered taxes, which has been historically proven, then why not raise taxes on those who can afford to pay? Taxes could be raised on the rich and lowered on the middle class. The $100 billion that corporations park offshore each year, and, consequently, pay no taxes on could be reclaimed by changing the law. The middle class has already been pounded by the fact that most income over the last 10 years has gone to the upper income groups resulting in the greatest amount of income and weath inequality since the 1920s.
So it's a no brainer to raise taxes on the wealthy to solve the deficit problem at least. Now what about the jobs problem? Right now corporations are being given tax breaks to move jobs out of the US. It's hard to believe but that is government policy. Democrats tried to pass a law changing this, but guess who opposed it? That's right, the Republicans who will do everything in their power to keep the present status quo which favors the big corporations who want to increase profits by offshoring jobs to where they can be performed by cheap labor. So it's patent BS that lowering taxes on corporations will create more jobs in the US when the overriding penchant is for corporations to outsource jobs, and they will continue to do that tax breaks or no tax breaks.
Most big corporations are multinationals. That means they have no allegiance to the US or to American jobs. They will create jobs wherever it's profitable to do so. Right now a lot of American corporations are American in name only; they do most of their business - both in terms of producing and in terms of selling - overseas. So why not change the law to discourage imports that could be produced in the US and give favorable treatment to companies that create jobs in the US. Obviously, the US cannot just be a consumer market for products produced abroad. Stuff must be produced here in order that workers can earn enough money to consume the products they need. The US cannot be just a consumer market for multinational companies.
So how are more jobs in the US to be created? 1) Discouraging imports and encouraging production within the US. 2) Massive government involvement in infrastructure repair and creation. #2 would require government expenditures that would increase debt only if the money is borrowed. However, raising taxes can not only be a solution to solving the debt problem, but it can also be a partial solution to solving the jobs problem without increasing the debt. So why isn't it being proposed by the Democrats? Partly, it's because right wing media has labeled Obama a socialist already for his puny American Recovery and Reinvestment Act which was mainly another tax cut. All this tax cut did was add to the debt. The puny amount that was directed towards saving and creating jobs was not big enough to have a major effect on the unemployment rate although it did some good. What is needed is a massive infrastructure investment program and revenue enhancement in the form of tax increases on those who can afford to pay to fund it.
So there you have it: problem solved, debt stabilized, jobs created. And the way it's solved is to raise taxes on those possessing all the money that's sloshing around in the casino economy and going back to a tax structure similar to what was in effect under Eisenhauer (when the top marginal tax rate was 91%) and Nixon (when the top marginal tax rate was 70%). Not only are the Bush tax cuts ruining the financial solvency of the US government but the Reagan tax cuts are adding to the ruin. But Democrats can hardly run on raising taxes even though they are gaining some traction with the idea of raising taxes on the wealthy but not on the middle class. They need to keep repeating this theme so that the American middle class will deconflate raising taxes with raising taxes on everyone.
