The last of the primary elections occur today and, of course, the big story, at least from the view point of the mainstream media which loves dramatic controversy, involves the Tea Party challengers. I see two other stories that deserve play but are either ignored or handled very superficially. CNBC has spewed quite a few words over the last couple of weeks on the theme of 'class warfare.' The talking heads have usually mentioned that when they talked about the proposed extension of the Bush tax cut because they all favor the Republican plan to extend them for all while panning the Democrats for wanting to limit the extension to the lower 98% of Americans. They also mention class war when they talk about the general perception the American public has of the CEO compensation and the various bailout programs that never seem to 'trickle down' to Main Street. The Illinois senatorial election is heating up and we get a lot of their campaign ads because we live so close and almost all of our news comes out of Chicago. And what I see in those ads is a cynical attempt by all sides to capitalize on the perceived 'class warfare.' Alexi Genoulius' ad commiserates with those poor people who have to get by on minimum wage (of $8.50/hour) and claims that 'rich' Mark Kirk, with his expensive car (make was mentioned but I don't remember it) and condo in Florida wants to roll that back. Mark Kirk's ads hit Genoulius for proposals to raise state and federal income taxes while 'rich Genoulius paid no income tax himself last year while Kirk voted 40 times to lower income tax rates. I had more than enough of rich men trying to convince me that they were 'good ole boys' with George Bush and his cronies. I don't trust either of them much and I certainly don't want to have a beer with them. I would dearly love to see elected officials who did not see the interests of giant, multinational corporations as synonymous with the interests of all Americans.
Another rant--on taxes: As I listened to the so-called debate on taxes I suddenly realized that, if we accept the claims all of the parties make on this issue, no taxes would be raised on anyone or any business. The 'pro-business' talking heads claim that if we cut taxes on businesses we will get more jobs and conversely, if we let the Bush tax credits expire, if businesses (especially small businesses) have to pay higher taxes they will not hire more unemployed workers. The 'pro-consumer' talking heads claim that taxes on consumers lead to lower consumption and is a drag on the economy. Question--who the hell do we tax? And does the logic hold water? In good times, when cash is flowing liberally and demand is high, higher costs (including taxes) would enter into the equation and hold down hiring. But in slow times, when money is tight and demand low, it doesn't matter how low you cut taxes businesses will not hire. So, cutting taxes on businesses now will only result in a higher deficit and little, if any, additional hiring. As far as The Consumer, that interesting mythological creature, is concerned lowering taxes on people who have no income to spend will not make them more likely to spend--especially when credit is tight. And then there is that subspecies of The Consumer--the Rich Consumer--who hasn't had to curtail spending because they are still getting richer as his poorer brother is getting poorer. As with businesses, reducing the Rich Consumer's taxes may lead to marginal increases in spending but not nearly enough to compensate for the budget deficit that would result. If we follow the logic of this NO ONE gets taxed and we are left with government spending cuts to get us out of the budgetary hole. What spending do you want to cut? Most of the attention has been on Social Security, Medicare, and Medicaid--but those programs are only about one-quarter of the budget. Another quarter goes directly to on-the-books military spending. Does anyone want to cut the defense contracts that support Boeing and the Seattle area? I think you can see where I am going with this. There is no group and damned few individuals in this country that do not receive some government subsidy. Look back at some of the tax breaks and subsidies BP and other oil companies get. Look at the link in yesterday's post on Alan Simpson and then realize that he is not the only cattleman who gets a massive subsidy through low charges to use public land for grazing. Where do we start to clean out this Stygian stable?
So the last of the combat troops have left Iraq. Or have they? This Reuters article makes me question that assertion. If it looks like a duck, quacks like a duck--it is a duck. Semantics papers over a lot of s**t.