Growing our economy has become a key focal point in political discussions in recent years, and has important public policy implications moving forward. In the name of "economic growth" and the pursuit of "pro-growth" policies, we have implemented a series of austerity measures that have been devastating to the public at large, while protecting and further enriching the wealthy class in America.
- An Economy for Everyone ensures we all benefit, not just the affluent
The term "economic growth" is a right wing frame designed to convince us that we should focus our attention on the overall economy, thereby taking our focus away from growing our own families' income. It's designed to mislead us into believing that we all benefit when things like GDP grows, or the stock market goes up. We've been conditioned to cheer those kinds of "economic indicators," even though their measure has little to no benefit to the average working family.
GDP per capita is not a measurement of the standard of living in an economy; however, it is often used as such an indicator, on the rationale that all citizens would benefit from their country's increased economic production. Similarly, GDP per capita is not a measure of personal income. GDP may increase while real incomes for the majority decline. ~ Wikipedia
Once we've been convinced of the need to grow our economy, the next step is to convince us that the best way to achieve this is to give wealthy people more tax breaks. But the wordsmiths know you will object to giving rich people breaks, so they re-framed it as "tax relief" to make you feel that the privileged folks are the ones who are suffering and need relief. Since the government can't operate without income, the actual burden ends up falling significantly harder on us. In the end, we pay more in taxes, so the wealthy can pay less!
A recent study by the non-partisan Congressional Research Service (CRS) does a great job at exposing both right wing frames: "economic growth," and "tax relief." The CRS study specifically analyzed 65 years worth of data between top tax rates and economic growth. Although the top tax rates wealthy people pay have never been lower than during this time period, the study found no correlation between top tax rates and economic growth.
Another fascinating discovery was that a correlation was found between reducing the top tax rates and increased concentrations of wealth for this privileged class. In other words, voting for "tax relief" in the past has led to a transfer of wealth over the past 65 years from millions of hard-working Americans to a few affluent families. It’s clear from these findings that providing "tax relief" in the name of pursuing "economic growth" is actually harming our economy by unnecessarily privileging the wealthy at the expense of everyone else.
The title pretty much says it, but let's explain ...
We have a serious problem in America: Workers in this country have not seen their level of compensation rise in 40 years in comparison with executive and shareholder compensation, the actual cost of living, or even their own productivity.
Our political leaders have focused on the disparity between worker and top executive compensation, referring to it as either "pay inequality," or "pay inequity," but this has created an atmosphere of defensiveness on the part of those at the top of the corporate food chain. And this is not the atmosphere that Progressives want to engender. We know it's going to take all of us working together—especially those at the top—to get this problem solved.
And lagging worker compensation is a problem, not just a "discrepancy" issue or a "fairness" issue. And no one thinks the average worker and the most senior executive should be earning "equal pay" as one another. So what is the real problem?
From at least the mid-twentieth century until the mid 1970s, worker productivity and worker compensation traveled on the exact same path. Hard working Americans saw their pay increase in direct proportion to their efforts. This made for a robust working and middle class in America, who had money to live on, money to spend, and money to save. When the middle class has sufficient money to live on, they only need to fall back on taxpayer-funded assistance if they hit a serious bump in the road, such as the loss of a job and the draining of all savings.
My father and I had to agree a long time ago to never, ever discuss politics. The last time we tried to talk politics, it ended in a screaming match and a lot of hurt feelings. But it came up in conversation yesterday when I called to wish him a Happy 4th of July. He asked what was new, and I told him I was excited to have former Senior Faculty Fellow at the Yale School of Management, Bruce Judson, as a new contributor to my project. I really didn't want it to turn into a conversation about politics—I was just proud and wanted him to be proud of me—but it went there nonetheless. Only this time it ended with him asking me to email him a link to this website so he could read more.
The following are random snippets in no particular order (except the last one), obviously somewhat paraphrased since I didn't record and transcribe our exact words. Here's how I got my father to not only understand the Progressive position on a few issues better, but inspired him to want to find out more.
Progressives hate the Constitution and want to change it. They think it's an outdated document and should be completely rewritten.
What? (This, I admit, was an entirely new one to me.) Where on earth would you get an idea like that? Progressives love and respect the Constitution. Look around my site and you will see numerous references to our Constitution and quotes by our Founding Fathers. Many, if not most, of our Founding Fathers actually were Progressives! That's why they so often referred to "the common good," and enshrined the responsibility of Congress to act on behalf of the "general welfare" of all people above the interests of corporations or other interest groups, into our Constitution.
I'm not going to your site. If you're planning on turning your project into a business then you must be "on the side of business," then! (Unspoken but understood: HA - Gotcha!)
"All the property that is necessary to a Man, for the Conservation of the Individual and the Propagation of the Species, is his natural Right, which none can justly deprive him of: But all Property superfluous to such purposes is the Property of the Publick, who, by their Laws, have created it, and who may therefore by other laws dispose of it, whenever the Welfare of the Publick shall demand such Disposition. He that does not like civil Society on these Terms, let him retire and live among Savages. He can have no right to the benefits of Society, who will not pay his Club towards the Support of it."
~ Benjamin Franklin, letter to Robert Morris, December 25, 1783
On Friday, June 8, 2012, President Obama addressed the press, and in the course of his comments, made the following statement:
“The truth of the matter is that, as I said, we’ve created 4.3 million jobs over the last 27 months, over 800,000 just this year alone. The private sector is doing fine. Where we’re seeing weaknesses in our economy have to do with state and local government"
Those who were paying attention—on both sides of the political spectrum—flew into a tizzy, calling it a "gaffe," and compared it to John McCain's ill-timed and utterly wrong statement—as the economy plunged precipitously into recession—that "the fundamentals of our economy are strong."
Democratic strategist James Carville, along with the Greenberg, Quinlan, Rosner Research Group, held some focus groups and concluded (pdf) that even though it's true that the Private Sector is "doing fine," most Americans don't feel that it's doing fine. And there's a very good reason for that. For most Americans who were affected by job loss during the recession, though they may have returned to work, they haven't returned to any level of prosperity.
The discussion always begins with discussion of their experience with job losses for themselves and their families -- and how that has left them struggling to pay for groceries.
Most have jobs now, but speak about their lower wages and benefits. Because wages are down, there has been a dramatic rise in discussion of very basic pocketbook issues. And this does not seem like some passing phase.
This has not been a pocketbook-level recovery for ordinary Americans. This is especially true for non-college-educated voters, who have been uniquely hit by this economy. They, their families, and people they know are on food stamps, on unemployment, and on disability.
It's heartbreaking to hear and read the stories of hard-working Americans who just want to work for a living, make a decent wage they can support their families on, start college funds for their kids with, have enough to set aside so they can enjoy their retirement, and perhaps have a little left over to spend a bit frivolously (who doesn't want a cool iPhone or Android, or the latest kicks on the market—and why shouldn't they?), but who are forced by economic circumstance to feel "lucky" to have any job at all.
Well there's a really good reason that the Private Sector is actually "doing fine," but most Americans—middle class, former middle class, and working class families all across this nation—aren't feeling the least bit "fine." And this is it ...
In an interview with Wolf Blitzer, Senator Bernie Sanders describes a much needed effort to reign in the big banks who are walking all over us. As pointed out by Sen. Sanders, the six largest financial institutions (ie, big banks) own more than half of all mortgages in this country, two-thirds of all credit cards, and assets of $9 trillion dollars, which is equivalent to two-thirds of the entire Gross Domestic Product (GDP) of the United States.
What does this mean for you and me? Well, for starters, the privileged class in this country is accumulating massive amounts of wealth at the expense of everyday citizens by squeezing them with increased ATM and other bank fees, hikes on their credit card interest rates, and predatory lending practices that led to the housing crisis we are still recovering from. To make matters worse, these privileged members of society are using their enormous wealth and power to influence our elected officials to enact a variety of legislation that perpetuates the status quo of income inequality. By doing so, the GOP is effectively allowing a select few at the top to achieve prosperity at the expense of the rest of us, who are doing our best to keep our heads above water and make ends meet.