Why GOP Administrations are Economic Failures that Prove Marx Correct

by Len Hart, The Existentialist Cowboy

When Bush Sr fought against, perhaps vanquished 'supply-side economics', it was hoped that the horrible Reagan years could be, would be consigned to the 'dust bin of history'! But no! It was left to 'Shrub', George W. Bush, to unleash unholy forces in order to breathe life into "trickle down theory" otherwise called 'supply side economics!

As it was taken off life support, it was surely Dick 'cyborg' Cheney who may well have yelled: It's ALIVE!

Cheney, of course, professed the Reagan doctrine: "Deficits don't matter". This is a bona fide case of terminal denial and accounts for supply-sider control of the Republican party. But what about Obama? He inherited a run-away train in search of its wreck. As Obama prepared to occupy the White House, the debt grew. Meanwhile, the caped villain (Cheney) and his budding monster(Bush) were still at work licking their chops and dreaming of fight night!

It's ALIVE! It's ALIVE!

Debt had accelerated during Bush's last two budget years. Although Obama had not been directly responsible for that acceleration, the train wreck had been left to him.

As the GOP are wont to do, Bush set records, in fact, the all-time record by increasing the debt by $1.1 trillion in a mere 100 days between July 30 and Nov 9, 2008.

Then there was the not-so-small matter of recession. To be expected, recessions cut tax revenues significantly and this fact may account for the GOP's sorry record of running up the highest debts and deficits! This has been the case since prior to the Great Depression. It is the pattern that is repeated in every GOP administration since H. Hoover's "Great Depression".

In this case, however, GOP mismanagement accounts for almost half of the deficit. We can be sure that the GOP were prepared to blame Obama for the deficit though his only crime was that timing. Machiavelli might have advised him to sit it out, let the GOP take the rap! Let the GOP face the music and dance quickly out to the door to oblivion. Blaming Obama for the full deficit was said to have been akin to "blaming him for not raising the tax rate to keep tax revenues up".

In times when the class struggle nears the decisive hour, the progress of dissolution going on within the ruling class, in fact within the whole range of old society, assumes such a violent, glaring character, that a small section of the ruling class cuts itself adrift or joins the revolutionary class, the class that holds the future in its hands.

Of all the classes that stand face to face with the bourgeoisie today, the proletariat alone is a genuinely revolutionary class. The other classes decay and finally disappear in the face of Modern Industry; the proletariat is its special and essential product. The lower middle class, the small manufacturer, the shopkeeper, the artisan, the peasant, all these fight against the bourgeoisie, to save from extinction their existence as fractions of the middle class. They are therefore not revolutionary, but conservative. Nay, more, they are reactionary, for they try to roll back the wheel of history.

If, by chance, they are revolutionary, they are only so in view of their impending transfer into the proletariat; they thus defend not their present, but their future interests; they desert their own standpoint to place themselves at that of the proletariat. The "dangerous class", the social scum, that passively rotting mass thrown off by the lowest layers of the old society, may, here and there, be swept into the movement by a proletarian revolution; its conditions of life, however, prepare it far more for the part of a bribed tool of reactionary intrigue. In the condition of the proletariat, those of old society at large are already virtually swamped.

The proletarian is without property; his relation to his wife and children has no longer anything in common with the bourgeois family relations; modern industry labor, modern subjection to capital, the same in England as in France, in America as in Germany, has stripped him of every trace of national character. Law, morality, religion, are to him so many bourgeois prejudices, behind which lurk in ambush just as many bourgeois interests.

All the preceding classes that got the upper hand sought to fortify their already acquired status by subjecting society at large to their conditions of appropriation. The proletarians cannot become masters of the productive forces of society, except by abolishing their own previous mode of appropriation, and thereby also every other previous mode of appropriation. They have nothing of their own to secure and to fortify; their mission is to destroy all previous securities for, and insurances of, individual property.

-- Karl Marx, Manifesto of the Communist Party

In the U.S. it is the GOP which consistently advocates, perhaps fronts, the interests of its primary sponsor: the ruling elite of just 1 percent of the total population. In effect, every real person but those among the top 1 percent are without representation in what is said to be the world's largest "Democracy". Is it really a 'democracy'? It is ironic that while Marx is most demonized by this unholy alliance, it is the existence of the unholy alliance itself which proves Marx to have been correct about almost everything.

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A Declaration of Class Warfare

by Len Hart, The Existentialist Cowboy

When I started following the flow of wealth upward, the top 10 percent already owned more than the rest of us combined. Now --the 'ruling' one percent owns and/or controls more wealth than is owned by the rest of us combined. Enron was not an aberration. Enron's crime was not only that of putting the screws to California; Enron's crime was 'getting caught'. The sell out to China by Nixon/Bush was not an aberration; it was, like Enron, a part of the game plan. It is no accident that China props up the buck but only because and when it is in their interests to do so. Lately, China, it is said, is reconsidering its 'bargain' with Satan.

Monied interests control our daily lives in ways that we have not fully understood. We need dollars to buy not just 'luxury items' but essentials --housing, food, transportation. But, as a result of Nixon's Faustian bargain with China, our dollars are worth less (worthless?).

In the meantime, the ruling elites own the media that we watch. That's worth repeating: the elites --about a half-dozen huge corporations --own the media! Thanks to the administrations of Ronald Reagan and George H.W. Bush, the media was relieved of its responsibility to serve public interests. Thanks to Ronald Reagan, the Fairness Doctrine was trashed, limits on corporate ownership rescinded. Thanks to Ronald Reagan primarily, the corporate media have no other job but to serve up lies and bullshit and tell you what to think! Fox is but the most obvious and repugnant example, but, in fact, no other outlet is, in any way, encouraged to be factual, fair, or responsible. The 'public interest' is considered to be 'quaint'.

When television is good, nothing — not the theater, not the magazines or newspapers — nothing is better. But when television is bad, nothing is worse. I invite each of you to sit down in front of your own television set when your station goes on the air and stay there, for a day, without a book, without a magazine, without a newspaper, without a profit and loss sheet or a rating book to distract you.

Keep your eyes glued to that set until the station signs off. I can assure you that what you will observe is a vast wasteland. You will see a procession of game shows, formula comedies about totally unbelievable families, blood and thunder, mayhem, violence, sadism, murder, western bad men, western good men, private eyes, gangsters, more violence, and cartoons. And endlessly commercials — many screaming, cajoling, and offending. And most of all, boredom. True, you'll see a few things you will enjoy. But they will be very, very few. And if you think I exaggerate, I only ask you to try it.

--Newton Minow, Upon his Appointment to the FCC by President John F. Kennedy

But this article is not solely about the media but about how the ruling 'elites' own and control K-Street and, hence, the government of the United States. It is about how the media is but a means by which the 'people' --you and I --are, in fact, ruled and manipulated. The elites own not only the media but the Military/Industrial complex! They are the sole beneficiaries of wars for which 'we the people' are expected to sacrifice both our lives and our lifestyles. Wars are fought entirely for the benefit of of this ruling elite. Bobby Darin's 'Simple Song of Freedom' nailed it: "....we the people here don't want a war!" Anyone not a member of the elite are cannon fodder.

Every major economist from the conservative Adam Smith to Karl Marx, from Ricardo to Krugman concedes: 'wealth' is created by labor. Ergo: wealth flows upward --never down as the GOP would have you believe. Supply-side ecnomics (trickle down theory) was clearly designed to fool a gullible public. It is nothing more than a disingenuous rationalization, in fact, a bald-faced lie! Understanding this reality explains why no GOP tax cut has ever benefited the U.S. economy. It also explains why, in fact, every GOP administration is defined by the recession/depression that inevitably catches up with them. It is a credit to the great and awesome GOP noise, bullshit and propaganda machine [NBPM] that any intelligent person in the United States should buy into 'supply-side economics', otherwise called 'trickled down theory'.

It is interesting that while 'labor' creates wealth, it is the 'ruling elite' which --alone --benefits! Only the word slavery can describe an absurd upside-down, through-the-looking-glass world in which the rich have acquired the political power required to grant themselves 'largesse' --tax cuts and lucrative contracts!

A perfectly egalitarian society could get along just fine if there were perfect equality, i.,e if there were no rich folk whatever. I would put money on such a society being much more productive, happier, peaceful! Why are wars fought? Wars are fought to seize the resources of other nations and in almost every case the assets seized are distributed in various ways to the ruling elites who are most certainly the most vocal proponents of war. Rome is still the best analogy. Rome was often bankrupt! Rome invaded Dacia for its 'gold'! Why? Roman sesterces were worthless as a medium of exchange. As a mere token to facilitate a head-count, sesterces would get you into the Coliseum. It is doubtful that it was worth a load of bread. When the Praetorian Guard auctioned off the empire, it was purchased by a nobleman --Didius Julianus! He paid in Greek Drachmas --not the worthless roman 'currency'.

Who risks his/her life in wars abroad, wars which benefit only the ruling one percent? It is the poorer classes who are honored with front-line duties. It was those 'left behind' by GOP policies who were, in various ways, rounded up and sent to the front lines in Viet Nam and, more recently, Iraq! Because of the 'draft' --involuntary servitude --Viet Nam was especially troubling. Iraq is no less disturbing; because of a failing economy, recruiting was easy from among those left behind by the GOP and exploitative right wing policies in general. How many members of the 'ruling one percent' have been killed in Afghanistan and/or Iraq? I want names and numbers!

The very presence of elites distort markets. If there were no 'elites' the price of advertising would adjust to reality --a little thing called 'supply' and 'demand'. Basic economic concepts include 'elasticity' or 'inelasticity' of demand, concepts that describe the responsiveness of 'demand' to changes in price. The same concepts describe 'demand' for money, i.e, the effect of great wealth upon money markets. The demand for most necessities (food, medicine, basic clothing) is said to be ineleastic, i.e, people who are very sick, for example, will pay almost any price for relief or cure. The hungry will pay almost any price for food --if they should be lucky enough to have it.

For everyone but the very rich, this is true of money. For us, money is a necessity. Elites, however, increase their holdings most dramatically when the dollar is lowest vis a vis other world currencies. Thus, great wealth controls the world market for money. We are but pawns, monetary cannon-fodder, thrust into the front lines of the money wars. We plebs are but pawns who must inevitably take the fall for 'Queen and country'.

If there were no 'elites' to bid the prices up with their mere presence, ski resorts might enjoy a 'plebeian' clientele. But, because skiing is 'in' among jet setters, playboys and glamorous blondes, folk will spend absurd sums to ski in Aspen. These people are not better than you and I --just richer. I know at least one extremely wealthy health-club magnate drawn to Aspen like a bee to honey. He turned out to be, like many another rich asshole, a psychopath who left his wife, moved in with a hot 'honey' and when things did not go his way hired incompetent hit men who tried but (fortunately) failed to murder the intended victim, a beautiful blonde pageant winner. She recovered, changed her identity and, presumably left the country.

In fact, little would change but for those items in which the ultimate retail price is bid up by big money. But if there is no big money, the production and sale of 'goods' would simply find a new level, a new equilibrium. The elites have bid up prices unnecessarily and there is no evidence that there is or ever has been a rationale, a reason why this must be the case. It is often implied that this is just the way the world works, the 'way things are'! I don't think so! I often got into trouble as a high schooler for daring to ask: who sez?

In fact, many are priced out of markets. But why? What is the net gain to society as a whole? Some items that are prohibitively expensive to produce and/or market might go the way of the dodo unless they are absolutely essential to --say --national security! I don't think Beluga caviar qualifies.

I daresay --more egalitarian economies are the more efficient economies; inequitable economies much less so as inequities increase. In the U.S. the degree to which an economy is determined to be either egalitarian or skewed toward elites is measured by the GINI INDEX. I would urge a bright seeker of a doctorate in economics to make the case (in his/her paper) that in the U.S. the most egalitarian regimes are and have been the most productive as measured by the ratio of GINI to GDP. It is no coincidence that every major recession – at least –since WWII has occurred during and as a result of GOP economic/monetary policies, primarily Calvin Coolidge, Herbert Hoover, Dwight Eisenhower, Ronald Reagan, George H.W. Bush, George W. Bush. Who did I leave out? It must be pointed out that every GOP administration since World War II has, likewise, run up the largest debts and deficits. On this point, it is the administration of Ronald Reagan that is the specimen that is typical of the GOP 'species' as a whole.

Recessions may not be defined by joblessness but are always characterized by it. Typical of the right wing, Austrian economist Joseph Schumpeter dismissed this result saying that the Great Depression (for example) was simply a 'good, cold douche' for the economy'. Douche! A 'douche', he called it! I don't buy that. I think his argument was and remains shallow and flippant and, rather, missed the point! Rather --recessions benefit only the investor class perhaps by design. It is hard not to conclude that they are manufactured so that the investor class can take its profits, sell short, and, in other ways, consolidate positions. We buy into this because, in America, it is all we've known. Face it ---we've all been brainwashed since birth!

The very, very rich benefit from what I call the 'Malibu Effect' defined by the ability of rich folk to 'price' poor folk 'out of a market'. For a long time, the houses on Malibu were nothing to write home about. Until, that is, the very rich discovered Malibu! Big money wasted no time bidding up the price of wood frames on stilts. You could have had the same house in Lazbuddy, TX for a song. But because it is 'in' or 'fashionable', the word MALIBU on your address is worth a lot of money ---wood frame or not!

But --what if there were fewer inequities in income and wealth? What if it were not possible for the absurdly rich to bid up prices so...well...so absurdly? I can recall a time when 30 thousand bought you a two story, three or four bedroom, den, state of the art kitchen, two car garage with a lawn. Get an old B and W video of "Leave it to Beaver". Check out that house! These people were 'middle class'. Try getting a house like that on what is called a middle class income today!

It was in the late 60s that a distinguished economist (whose name I cannot recall) wrote that 'status symbols' were on the wane as income and wealth inequities declined. His words were written during the administration of LBJ. Perhaps Lyndon had created a 'great society' after all.

I am quite sure that as this economist was writing, the GOP base of elites were already scheming to change all that. Since that time, the GOP has succeeded in proving that they have the power to price you out of the market for many things that are not only desirable but often necessary. Why should the very wealthy be allowed to deny the middle and lower classes of access to health care, quality education, decent housing, transportation to jobs? Health care is often the battleground on which is waged this war between the classes! It is not enough that the elites can afford to get care and you cannot, the elites --by way of their control over both K-street, Wall Street and Congress --deny you what should be declared a universal, human right to 'universal health care'!

Addendum:

Yes, the S.S. Minnow from Gilligan's Island is being restored and will be available for tours. More than one boat was used on the show, but this is the one in the opening credits.

I have special affection for this boat because it was named after my father, Newton Minow, whose famous speech to the broadcasters calling television a "vast wasteland" annoyed "Gilligan's Island" creator Sherwood Schwartz. So Schwartz named the sinking boat after him! My dad got a huge kick out of it and later had a very cordial exchange of letters with Schwartz. It is a great point of pride for our family. [Read more]

Bobby Darin: A Simple Song of Freedom


Lost on Gilligan's Island

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A Party of Panic and Depression

by Len Hart, The Existentialist Cowboy

The administration of Ronald Reagan ushered in a depression of some two years, the longest and deepest since Hoover's Great Depression of the 1930s. Millions were put out of work. Many businesses, entire industries never recovered. The Reagan depression followed a GOP tax cut benefiting only the upper quintile. As a stimulus, it was an obvious failure, yet that's how it had been sold. It's how they are always sold.

The real world results: a depression of some two years, a contraction of the economy, a transfer of wealth upward to the upper quintile, the nation's richest 20 percent. A windfall of this nature is not stimulus to invest but, rather, to transfer the gains offshore. There were no net gains in jobs. There was no Reagan-recovery. There were, rather, net losses, declines in employment. The government's own stats prove it. They are available the Bureau of Labor Statistics, the Census Bureau and the U.S. Commerce Department --B.E.A.

Our Major Exports: Death and Destruction

Check the CIA's 'World Fact Book' where you will find listed on the very bottom the United States with the world's largest NEGATIVE Current Account Balance. China is on top with the world's largest POSITIVE Current Account Balance. The downside for China is this: it must prop up the worthless U.S. dollar if it wishes to survive by dumping its product on our shores. The downside for us is this: we are now a vassal state of China. Anyone reduced to shopping at Wal-Mart should know this. If not, I suggest you search the shelves and aisles for goods manufactured in the United States and exported abroad. I doubt you will find any.

If the U.S. citizenry believed that there was booty to be gained with oil wars in Afghanistan and Iraq, it was fooled again! Clearly, then, the war racket has done absolutely nothing for the US bottom line and less for the working people who are always faced with the prospect of living in a tent city during a downturn. The US, the right wing in particular, for all its bullshit and bluster has less than nothing to show for the many lives sacrificed at the alter of greed and capitalist/imperialistic ambition.

The US follows the Roman model of empire though it is difficult to say which comes first --the collapse of the real economy or the commencement of empire? In the case of Rome, it is clear that the local economy was already in trouble when Rome began its conquest of Dacia for its gold! Had Rome been producing more than it had been consuming it might have survived and prospered. As the dollar is all but worthless today, the currency of Rome --sesterces --was worthless except as a means by which a head count could be made of those attending the gladiatorial contests in the Coliseum. Something needed to be done and quickly. The Praetorian Guard saw an opportunity in Rome's increasingly difficult problems. The Guard took action, selling, at auction, the Roman empire. The highest bidder  was Didius Julianus who purchased the empire with Greek Drachmas, not worthless sesterces.

The U.S. dollar is similarly debauched but conveniently propped up by China. That is not the case because China wants to help us out. Rather, China must support the dollar if it wishes to continue selling to U.S. consumers. Some have said that China "dumped its crap" on the U.S. consumer via Wal-Mart. If it did not, it was said, its own burgeoning population would face utter poverty, millions might starve. Chinese poohbahs will, of course, blame the U.S. Facing starvation, China it was feared would threaten the world, if it had not already.

The New National Capital/Capitol: K-street

K-street is the best little whorehouse in Washington; it's the nation's 'read light district' in which the apparatus of government is pimped! K-street --not Congress --is where the bills, the laws, the policies are written, decided upon for a price! K-street is where the 'Johns' buy the bureaucracy and decide foreign and domestic policies. K-street is where money talks, souls are sold, bullshit peddled.

K-street is where the so-called 'Jewish Lobby' (read: Israeli Lobby) dictates American foreign policy. Some have called it a marriage made in hell, in fact, a Faustian bargain, in which the soul of America is bartered or whored-out outright! What's in it for the U.S. to continue to support the increasingly fanatic, aggressive and extremist governments in Israel? The most obvious answer is this: Israel provides the convincing 'pre-text' for US oil wars in the Middle East. Big oil has said to Israel or perhaps Israel to big oil: 'you scratch my back and I will scratch yours!'.

The Republican Party was once a moderately conservative, pro-business outfit, until it was hijacked by the oligarchy and turned into a full-on predatory machine, hiding behind the facade of hate mobilizing issues like bogus overseas threats abroad and uppity brown people and demanding women at home. Basically, any way that middle class white males could be distracted from their sinking economic status - through the diversion of a sense of superiority over others, or the supposed threat to that superior status - was employed to cover for a party whose true agenda was to quietly produce the greatest transfer of wealth in all of human history.

Having succeeded dramatically, they are back at it again. It is now transparent, for anyone who cares to look, that the ugly tea party movement in America is an invention of the Koch brothers, Rupert Murdoch, Dick Armey and their sick ilk, once again mobilizing a boatload of fools who are angry, but too stupid to know quite why. This explains their endless rhetoric about the evils of the federal government, and their simultaneous desire to keep their Social Security and Medicare benies. It also explains their unmatched idiocy in serving as tools for their own destruction. If they succeed, they fail. If they get their champions elected, they lose their government-provided (Shhhh!) goodies. Brilliant.
In any case, the takeover of the GOP by Serious Money is now well into its second stage. Just when you thought it couldn't get any worse, it is. Seriously, what is the next step after this one fails to provide any long-term solutions to what ails America, as most assuredly will be the case? For a decade or three now, regressives in America have been showing that they are capable of anything. Which more or less answers that question, doesn't it?

If you're willing to savage military icons like John McCain, Max Cleland and John Kerry in order to win elections - and especially after you get away with it every time - you're willing to do anything. If you're willing to mock the 9/11 widows as scheming opportunists, you're willing to do anything. If you're willing to don a tuxedo and joke about missing WMD at a press banquet in Washington, just as you're telling the American military's adversaries in Iraq to "bring it on", you're willing to do anything; Our Long National Neight Isn't Over; It's Just Beginning, --David Michael Green

War is a Racket

It always has been. It is possibly the oldest, easily the most profitable, surely the most vicious. It is the only one international in scope. It is the only one in which the profits are reckoned in dollars and the losses in lives. A racket is best described, I believe, as something that is not what it seems to the majority of the people. Only a small "inside" group knows what it is about. It is conducted for the benefit of the very few, at the expense of the very many. Out of war a few people make huge fortunes.

In the World War [I] a mere handful garnered the profits of the conflict. At least 21,000 new millionaires and billionaires were made in the United States during the World War. That many admitted their huge blood gains in their income tax returns. How many other war millionaires falsified their tax returns no one knows.
How many of these war millionaires shouldered a rifle? How many of them dug a trench? How many of them knew what it meant to go hungry in a rat-infested dug-out? How many of them spent sleepless, frightened nights, ducking shells and shrapnel and machine gun bullets? How many of them parried a bayonet thrust of an enemy? How many of them were wounded or killed in battle?
Out of war nations acquire additional territory, if they are victorious. They just take it. This newly acquired territory promptly is exploited by the few – the selfsame few who wrung dollars out of blood in the war. The general public shoulders the bill.

--War Is a Racket, General Smedly Butler, Two-Time Congressional Medal of Honor Recipient, Major General Smedley D. Butler, USMC, Retired

Conspiracies are how things get done. Some are legal; some are not. A 'corporation', for example, is a conspiracy made legal by 'charter'. Corporations were described by St. Thomas More in his 'Utopia':

I can perceive nothing but a certain conspiracy of rich men procuring their own commodities under the name and title of the commonwealth.

They invent and devise all means and crafts, first how to keep safely, without fear of losing, that they have unjustly gathered together, and next how to hire and abuse the work and labour of the poor for as little money as may be. These devices, when the rich men have decreed to be kept and observed for the commonwealth’s sake, that is to say for the wealth also of the poor people, then they be made laws.But these most wicked and vicious men, when they have by their insatiable covetousness divided among themselves all those things, which would have sufficed all men, yet how far be they from the wealth and felicity of the Utopian commonwealth? Out of the which, in that all the desire of money with the use of thereof is utterly secluded and banished, how great a heap of cares is cut away! How great an occasion of wickedness and mischief is plucked up by the roots!

--Sir Thomas More (1478–1535), Utopia

If you are still drinking the Kool-aid, go to Findlaw, where the search term 'conspiracy' of itself will get you 690 cases. Go to the Cornell University Law Library. Type in the single search term 'conspiracy'! Among the hundreds (possibly thousands of cases) you will find No. 03-3156,UNITED STATES OF AMERICA,APPELLEE v.ANTONIO N. TABRON, A/K/A FAT CAT,APPELLANT.

The transfer of wealth upward is deliberate. It's how the 'pay-offs' are laundered. Initially, it was only the top 20 percent who benefited as charts dating to the beginning of the Clinton administration indicate and prove. Clinton briefly reversed the trend. It might have been Clinton's lasting legacy, his finest hour, had not the regime of George W. Bush resumed the payoff as evinced in the resumption of the inexorable flow of U.S wealth upward and outward.

I don't know who it was who said that Satan's biggest 'trick' was convincing the world that he did not exist. The traitors of the 'American' right wing have, in fact, sold out America while wrapping themselves in the flag, convincing you that 'conspiracies' do not exist. But, in fact, St. Thomas More's description of the 'conspiracy of rich men to procure their commodities in the name and title of the commonwealth' was never more accurate or more precisely descriptive than it is today. It is this 'conspiracy of rich men;', this ruling one percent who alone have benefited from GOP 'tax cuts', tax cuts which are inexorably followed by job losses if not recessions/depressions. And it is only the GOP which has benefited from them as working people are denied not only jobs but careers.

This is how the right wing thinks. While sane and/or scientifically inclined people will observe first and conclude later, the right wing acts upon prejudices and/or whatever rationalization makes them feel good about themselves. Supply-side economics is most certainly a rationalization whose origins lay in the troubled and often psychopathic minds of tortured Republicans. Thus 'trickle down' theory helps them feel better about themselves, relieves them of guilt, helps them sleep at night.

The GOP needs to believe. Studies by Stanford University prove that Republicans have more nightmares and night terrors than do normal people. To this end, they shoe-horn reality into a GOP mold; they work backward from foregone conclusions. They cannot suspend a prejudice long enough to reach a conclusion based upon evidence or verifiable fact. They reverse 'cause and effect' and often mistake one for the other. They will shoot first and ask questions later! They will not tolerate facts that proves them wrong.

Here are the basic facts on the major financial panics of the 19th century.

Panic of 1819

The first major American depression, the Panic of 1819 was rooted to some extent in economic problems reaching back to the war of 1812.

• It was triggered by a collapse in cotton prices. A contraction in credit coincided with the problems in the cotton market, and the young American economy was severely affected.
• Banks were forced to call in loans, and foreclosures of farms and bank failures resulted.
• The Panic of 1819 lasted until 1821.
• The effects were felt most in the west and south. Bitterness about the economic hardships resonated for years and led to the resentment that helped Andrew Jackson solidify his political base throughout the 1820s.
• Besides exacerbating sectional animosity, the Panic of 1819 also made many Americans realize the importance of politics and government policy in their lives.

Panic of 1837

• The Panic of 1837 was triggered by a combination of factors including the failure of a wheat crop, a collapse in cotton prices, economic problems in Britain, rapid speculation in land, and problems resulting from the variety of currency in circulation.
  
• It was the second-longest American depression, with effects lasting roughly six years, until 1843.
  
• The panic had a devastating impact. A number of brokerage firms in New York failed, and at least one New York City bank president committed suicide. As the effect rippled across the nation, a number of state-chartered banks also failed. The nascent labor union movement was effectively stopped, as the price of labor plummeted.
  
• The depression caused the collapse of real estate prices. The price of food also collapsed, which was ruinous to farmers and planters who couldn’t get a decent price for their crops. People who lived through the depression following 1837 told stories that would be echoed a century later during The Great Depression.
  
• The aftermath of the panic of 1837 led to Martin Van Buren’s failure to secure a second term in the election of 1840. Many blamed the economic hardships on the policies of Andrew Jackson, and Van Buren, who had been Jackson’s vice president, paid the political price.

Panic of 1857

• The Panic of 1857 was triggered by the failure of the Ohio Life Insurance and Trust Company, which actually did much of its business as a bank headquartered in New York City. Reckless speculation in railroads led the company into trouble, and the company’s collapse led to a literal panic in the financial district, as crowds of frantic investors clogged the streets around Wall Street.
  
• Stock prices plummeted, and more than 900 mercantile firms in New York had to cease operation. By the end of the year the American economy was a shambles.
  
• One victim of the Panic of 1857 was a future Civil War hero and US president, Ulysses S. Grant, who was bankrupted and had to pawn his gold watch to buy Christmas presents.
  
• Recovery from the depression began in early 1859.

Panic of 1873

• The investment firm of Jay Cooke and Company went bankrupt in September 1873 as a result of rampant speculation in railroads. The stock market dropped sharply and caused numerous businesses to fail.
• The depression caused approximately three million Americans to lose their jobs.
• The collapse in food prices impacted America's farm economy, causing great poverty in rural America.
• The depression lasted for five years, until 1878.
• The Panic of 1873 led to a populist movement that saw the creation of the Greenback Party.

Panic of 1893

• The depression set off by the Panic of 1893 was the greatest depression America had known, and was only surpassed by the Great Depression of the 1930s.
• In early May 1893 the New York stock market dropped sharply, and in late June panic selling caused the stock market to crash.
• A severe credit crisis resulted, and more than 16,000 businesses had failed by the end of 1893. Included in the failed businesses were 156 railroads and nearly 500 banks.
• Unemployment spread until one in six American men lost their jobs.
• The depression inspired "Coxey's Army," a march on Washington of unemployed men. The protesters demanded that the government provide public works jobs. Their leader, Jacob Coxey, was imprisoned for 20 days.
• The depression caused by the Panic of 1893 lasted for about four years, ending in 1897.

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Who Owns America and Why!

by Len Hart, The Existentialist Cowboy

Always severely divided in one way or another, the U.S. has become two nations --one of the very,very rich elite on the one end and the rest of us on the other. The rich have literally waged war upon the poor since the nation's founding. The so-called 'Robber Baron Era' was notable for preceding and causing the Great Depression.

Income and wealth disparities are even worse now! As a direct result of Reagan/Bush tax cuts benefiting only the upper classes just ONE PERCENT of the U.S. population owns more than 95 percent of everyone else combined. Poverty is higher among every minority group. A 'ruling elite' of just one percent is primarily White Anglo Saxon Protestant.

...two Americas...one privileged, the other burdened...one America that does the work, another that reaps the reward. One America that pays the taxes, another America that gets the tax breaks.

--Sen. John Edwards

Edwards was absolutely correct and, if anything, understated the problem. It is not surprising that the ruling elites, the establishment, and the fossilized leadership of the GOP would respond with yet another label: class warfare! If 'class warfare' it be, then 'bring it on'!

The current numbers should be compared with figures from 1998 when information provided to the IRS indicated that the richest 1 percent of U.S. households owned 38 percent of all U.S. wealth. Clearly --the Bush years were disastrous for the economy and must certainly be among the factors responsible for the current 'financial crisis'.

Up until the early 1970s, the U.S. actually had lower wealth inequality than Great Britain, and even than a country like Sweden. But things have really turned around over the last 25 or 30 years. In fact, a lot of countries have experienced lessening wealth inequality over time. The U.S. is atypical in that inequality has risen so sharply over the last 25 or 30 years.

--An Interview with Edward Wolff, The Wealth Divide: The Growing Gap in the United States Between the Rich and the Rest

Please note that the figures cited for wealth distribution are accurate as of the date of the 'interview' excerpted. More current figures are stated earlier in this article.

The transfer of wealth upward is a contraction of the supply of money among those who are most likely to spend or invest monies in ways that drive the economy. Supply-side economics has never stimulated the economy. In every instance, 'supply side' economic policies have precipitated recessions/depressions. Tax windfalls --clearly --were not invested in new jobs or expansion; rather, they were 'exported' to offshore accounts. Until the current crisis, the most notable examples were the Great Depression of '29 and the two year long depression triggered by Ronald Reagan's infamous tax cut for his rich backers in 1982. It is not surprising that Reagan's supporters would opine: 'He made us feel good about ourselves'. Well, if not 'good', then 'richer'!

Appalling poverty and the declining value of currency defined ancient Rome. When the Praetorian Guard auctioned off the empire to Didius Julianus, a nobleman, the sale was transacted in greek Drachmas --not worthless Roman sesterces. The U.S. dollar, today, is propped up by China so that U.S. citizens can buy Chinese stuff at Wal-Mart. That's because the US is at the very bottom of the CIA's World Fact Book with the world's largest NEGATIVE current account balance, formerly called the balance of trade deficit.

The U.S. is already a Vassal State of China and the impending fall of 'America' will simply 'formalize' a collapse that seems already concluded. When only the ruling elite have a place to live, the more overt symptoms will become increasingly apparent.

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It's the Hypocrisy, the Financial Collapse, the War Crimes

by Len Hart, The Existentialist Cowboy

Where were the 'tea baggers' when Nixon was selling us out to China to whom we are now but a vassal state?

Where were the 'tea baggers' when Ronald Reagan's incompetent policies would plunge the nation into the greatest depression since Hoover's 'Great Depression' of '29.

Where were the 'tea baggers' when it has since become clear that the US has not really ever recovered from the Reagan 'recession' in which were lost several major US industries to Japan and, most recently, China!

Where were the 'tea baggers' when Ronald Reagan sold us out to both Iran and the Contras?

Where were the 'tea baggers' when Bush Sr lied about raising taxes?

Where were the 'tea baggers' when Ronald Reagan called 'crazy' those made jobless by his idiotic, right wing policies?

Where were the 'tea baggers' when Bush Jr was bankrupting the nation with wars of naked aggression, lying about 911, covering it up, and money-laundering booty to his 'base' via 'tax cuts' and whopping defense contracts?

Where were the 'tea baggers' when Bush Jr waged war on what he called a 'goddamned piece of paper' known to the rest of us as 'The Constitution'.

Where were the 'tea baggers'? The Carvellian quick response: 'they were bent over with their heads squarely up their asses!

The Tea Party Express has hit Washington and while there are many sincere people involved in the Tea Party protests and they have valid points to make about government spending, the entire movement is stained by the fact that its organized by conservatives who are the ones responsible for the mess in the first place and who haven't to this day, taken responsibility for their own mistakes and the economic mess they created by letting George W Bush get away with his disastrous policies.

--The hypocrisy of tea party conservatives

I grew up listening to windbag conservatives denounce 'big spending librul's' and DC bureaucrats. So --what do these windbags do? They support Ronald Reagan who DOUBLED the Federal Bureaucracy and TRIPLED the national deficit. But this idiot ilk will still talk about 'big spending libruls'. Give it a frickin' rest or get a new comedy writer!

Enough already!

My suggestion to the GOP: unless you can come up with more creative lies, more entertaining bullshit, just do us all a favor and just shut the fuck up!

The same policies, under a Democrat, might have been redeemed by the 'Keynesian' increase in jobs which even Nixon would have embraced. But during the Reagan regime, NONE of the moneys spent so profligately 'trickled down'. Following Reagan's tax cut, called a 'red herring' by his own Budget Director David Stockman, the nation plunged into a depression of two years, the deepest and longest since the Great Depression during the Hoover years.

Now --after another INCOMPETENT GOP President bankrupts the nation, plunges it into yet another financial crisis, a war of naked aggression, commits war crimes for which he is culpable and prosecutable, so-called 'tea baggers' are protesting GOVERNMENT WASTE.

Where were these scumbaggers four years ago?

It was the conservatives who, after 8 years of the greatest economic expansion in history during the Clinton years, came to power and intentionally undid everything Clinton did, reversing all of Clinton's policies. And anyone with half a brain knows that if you do the opposite of anything you will get the opposite results. And that's what the Republicans did. And that's what the country got. Now the conservatives are shaking their baby rattles and complaining.

It was a conservative Republican administration and a conservative Republican congress who blew a $5 1/2 trillion budget surplus. They destroyed the balanced budget they inherited, and after Clinton had eliminated the deficit, they exploded the deficit to record levels with their war and tax policies.

It was a conservative Republican government that took the country from the greatest economic expansion in history, lowest unemployment in 40 years, a balanced budget and record surpluses to deficits, unemployment and the greatest economic crisis since the 1930's.

So during these Tea Party protests conservatives are showing why the word "hypocrite" should be part of the dictionary definition of conservative.

The hypocrisy of tea party conservatives

I know where these lying hypocrites were eight years ago. They were in Florida busily violating Federal Laws, attacking vote re-counters, stealing an election! They were trying mightily to effect Antonin Scalia's prescription for a GOP win: stop the recount while Bush was still ahead! Or as Robert Novak put it: 'the Democrats are trying to steal the election by counting votes!'

Eight years ago, this ilk was trying mightily to sandbag a continuation of Clinton's policies which --in fact --had reversed previous declines in jobs and GDP, another legacy of two failed GOP regimes: Reagan and Bush Sr.

Here are some facts I wish the GOP would choke on:

Job Growth Per Year Under Most Recent Presidents⁸

Johnson   3.8%
Carter    3.1
Clinton   2.4
Kennedy   2.3
Nixon     2.3
Reagan    2.1
Bush      0.6

-- Bureau of Labor Statistics, Current Employment Statistics Survey

The GOP prezzes are at the bottom because that's where their policies have taken the US vis a vis the rest of the world. Those official figures shatter the carefully cultivated GOP myth, in fact, an Orwellian re-write of history, a bald-face lie! Fortunately, enough patriotic liberals have survived the wave of murders and assassination to set the record straight after so many GOP-types have worked so mightily, so assiduously to set it crooked.

Reagan inherited many of those economic problems, but once he cut taxes, America's entrepreneurial spirit was unshackled. We experienced the greatest peacetime expansion in postwar history - the so-called 'Seven Fat Years' from 1983 to 1989. Then George Bush broke his 'Read my lips: no new taxes' pledge, and sent the economy back into recession."

There are several problems with this story. First, Carter actually began many of the policies that Reagan would later become known for; Carter gave the rich a capital gains tax cut, massively deregulated key industries like trucking and airlines, and even increased defense spending. This was also the period that corporate PACs began compelling Congress to pass pro-business legislation.

According to supply-side theory, these actions should have nudged the economy in the right direction, not plunged it into the worst recession in 40 years. Other problems involve timing: Reagan's first tax cuts went into effect in 1982, but this was also the summer that the Federal Reserve Board slashed interest rates and expanded the money supply. Most economists believe the Fed, not Reagan, was responsible for the following recovery. Finally, the recession of 1990 began four months before Bush broke his "no new taxes" pledge. The recession began in July 1990; Bush signed his tax increases into law in November 1990.

And supply-siders are careful to note that Reagan's was the longest peacetime expansion since World War II. In truth, the Kennedy-Johnson expansion was longer: 106 months compared to Reagan's 92.1 Of course, there was a war in Vietnam, which gives supply-siders an excuse to dismiss it because wars are beneficial to the economy. But they are beneficial because governments engage in Keynesian borrowing and spending during them (which could be directed to social services as well as war). Unfortunately for supply-siders, it was really Keynesianism that produced the longest economic boom since World War II.

--Steve Kangas, Economic Performance, The Reagan Years

Such GOP success as was enjoyed by the 'White Rioters' in Florida is a failure, a tragedy in fact, for the nation as a whole. I no longer expect the GOP to see past the end of its crooked nose, to perceive the fact that what is good for the GOP's increasingly tiny elite gang of oligopolists is not good for those of us who have refused to sell out to the special interests.

I am frankly not interested in defending Obama. If Obama did little more than just show up and punch a clock, he beats any GOP regime since WWII.

Anything but Joe, the idiot beats another disastrous GOP regime of lies, incompetence, cronyism, and rampant felony crimes at the highest levels of government. An unemployed paper hanger could have done a better job than Bush Jr ...a dumb ass if there ever was one!

DOWN WITH THE GOP!

There is a growing body of scientific research to the effect that 'Republicanism' is a mental illness! Earlier, Stanford Univ psychologists published the results of their studies concluding that Republicans have more nightmares and night terrors than do normal folk!

Earlier, Dr. Gustav Gilbert ascribed to Nazi 'war criminals' at Nuremberg a 'lack of empathy' and implied that it was the source of evil itself. Hanah Arendt, a founder of the distinguished New School for Sociological Studies in New York wrote of the 'banality of evil'. Anyone who has acquired and read the 'minutes' of the Nazi meeting at Wannsee conducted by Reinhard Heydrich will discover such 'banality', i.e, Nazi bureaucrats discussing disspasionately the the mass murder of an entire race over a gourmet lunch amid witty conversation and 'banal' quips.

Certainly --anyone who can look at Reagan's abysmal record after some four years in office and blame CARTER for it is either 1) nuts, or 2) stupid, or 3) both!

Hey, GOP! Live with this: Carter beats any GOP President since WWII.

Also see:

• How the US Became a Vassal State of China
  
• Terrorism is Worse Under GOP Regimes
  
• The US Army Document That Proves the US is the World's Number One Sponsor of World Terrorism
• Dissecting the Scrambled Brains of the GOP
  
• Why the CIA is the World's Number One Terrorist Organization
  [w/LINKS]
• Why the CIA is the World's Number One Terrorist Organization [PDF]
• How the GOP Pays Off its 'Base' of Elites
  
• A Spiritual Mind Movie

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How the US Became a Vassal State of China

by Len Hart, The Existentialist Cowboy

China owns the United States --or, at least, holds a 'mortgage'. China props up the dollar just enough to ensure that its excess production can be dumped here by way of its US retail outlet --Wal-Mart! The value of the US dollar is almost entirely dependent on China. When it ceases to be advantageous for China to prop up the dollar, the dollar will collapse.

The decline and fall of the American empire is a sorry, tragic saga. It is the story of betrayals of this nation by the likes of Richard Nixon, Ronald Reagan , Bush Sr., the Shrub, and many lesser known 'agents' of the increasingly tiny cadre of ruling elites. It is the story of how GOP administrations paid off its elite base with tax cuts which have had, in fact, the effects of impoverishing the poor, enriching the rich, exporting the US manufacturing base, and exporting the jobs that it had supported.

There are many versions of the 'supply side' story, but the most famous one involved a napkin and a Pizza Hut. While Ronald Reagan still occupied the White House, an alleged "economist" is said to have drawn a fictitious curve on a napkin. [More about this 'curve' to come.] As a result, millions lost their jobs, tent cities sprang up across the country, the nation plunged into a great recession --the deepest, most severe, the longest since Herbert Hoover's "Great Depression! I saw some of those 'tent cities' in 'boomtown' Houston. I was inspired to publish an essay in a local magazine. My essay was entitled: "What happened?" In a word, the bulls had gone bear if not 'bare'; the captains of capital cashed out at the top and left many another holding real estate that was declining rapidly in values. The least fortunate were those whose interest in Real Estate was simply that of keeping a roof over the heads of family members. Many of these folk lost their homes and moved into the 'tent city'.

Under the occupancy of George W. Bush, the folly was repeated and the harmful effects left to Barack Obama whom it is hoped will take the rap.

Called "preppies", they consulted Republican political campaigns and were in a position to spread economic dogma like 'supply-side' or 'trickle down theory'. Economists Arthur Laffer and Milton Friedman lent an imprimatur of respectability. Laffer, for example, drew a "curve" on a napkin which some believed proved the preposterous idea that reducing taxes for the elite classes would reduce debt and deficit. In fact, when Reagan put the theory to work with his infamous tax cut of 1982, the opposite occurred. Both debt and deficit increased. Supply side, i.e, 'trickle down' theory was proved wrong. Sadly, the GOP has not gotten the memo.

• Wealth might have 'trickled down' IF the wealthy had invested tax cuts domestically!
  But they don't and probably never have! They squirrel away their windfalls in offshore banks, havens, shady investments or other ways which do not create new jobs, do not raise wages or stimulate capital investments or growth! The opposite has always occurred, i.e, the economy, rather, has always contracted with each GOP tax cut! If the government wishes to stimulate an economy by stimulating spending, it should just cut out the 'middle man' or, as John Maynard Keynes suggested, it should put bucks in mason jars, bury them in a landfill and let 'labor' dig them up! There is no point in letting the very, very, very rich SKIM OFF the top with idiotic schemes like 'trickle down theory'.
• Lower income citizens do not bear smaller tax loads as claimed.
In fact, their taxes are always higher as a percentage of income because the working classes do not have access to most forms of depreciation, offshore tax havens, capital gains, tax credits, etc. Because they have dodges which salaried people don't, elites pay much less tax as a percentage of total gross income.

Unfair tax cuts always make the rich richer. Reagan's tax cut, for example, benefited only the upper quintile. [See the GINI Indices at the Bureau of Labor Stats later published by Brookings ] Bush Jr's cuts benefited an elite of just one percent which, as a result of his policy, owned more than 90 percent of the US population. By the end of his reign of terror, this elite of just one percent had increased its share of total wealth, owning more than 95 percent of the rest of the population combined.

I told ya so!

During the 1920s, the wealthy accumulated such exorbitant stocks of cash, they couldn’t spend it all. Instead, they played the stock market, fueling a rapid run-up in stock prices. Lower and middle income households, on the other hand, lacked wealth enough to meet their daily needs and were forced to borrow heavily. Today --the elites have squirreled their tax cut windfalls offshore, effectively removing wealth from the US economy. That is called a 'contraction' and it is the source of many recessions or, more properly, depressions.

Many historians believe that a combination of growing personal debt and a widening wealth gap destabilized the economy and precipitated the Great Depression, characteristics that define the current collapse. Not so long ago, the media touted rising economic growth and a soaring Dow Jones. Those 'signs' of wealth likewise preceded Herbert Hoover's Great Depression. Certainly, the 20s are remembered for vast inequities of wealth financed by growing consumer debt. Neither 'elephant' has left the room.

Welfare for Wall Street

The lessons of Enron and WorldCom were not learned. The GOP still schemes to PIRATIZE your Social Security and are, perhaps, even more motivated to do so now than during the Bush years. PIRATIZING Social Security i.e, letting Wall Street speculators play with YOUR money is the ultimate 'bailout' of crooks who brought you the current 'financial crisis'. There is simply no rational justification for allowing Wall Street to 'speculate', play the markets with your money.

What are 'private accounts' but a government give away, welfare for Wall Street? You already have the right to open a private account of your own anytime you wish. Giving Wall St speculators carte blanche to play the markets with monies you earned by working is foolhardy, stupid at a time when taxpayers have already underwritten a national debt of several trillion bucks. Privatizing Social Security means that when the next collapse occurs, you will pay for it twice --once with an immediate bailout out of tax revenues and --again --with your hopes for a comfortable retirement, the Social Security which you may never see again!

How right wing policies have robbed the US population with "trickle down theory" and other nonsense utterly unsupported with fact or evidence:

• In the late 1970s, the top one percent of the US population held 13 percent of the wealth; in 1995 it held 38 percent. [Source: Source: Levy, Frank. The New Dollars and Dreams ].
• The top ten percent of the US population owns 81.8 percent of the real estate, 81.2 percent of the stock, and 88 percent of the bonds. [Source: Federal Reserve Bank data in Left Business Observer, No. 72, Apr. 3, 1996, p. 5].
• One percent of the US population owns sixty percent of the stock and forty percent of the total wealth. [Source: Hawken, Paul, The Ecology of Commerce: A Declaration of Sustainability. New York: Harper Business, 1993].
• The top fifth of households saw their income rise 43 percent between 1977 and 1999, while the bottom fifth saw their income fall 9 percent....
• Since 1973, every group in society except the top 20 percent has seen its share of the national income decline, with the bottom 20 percent losing the most. They have just 3.6 percent of national income, down from 4.4 percent a quarter century ago.
• Indeed, the top fifth now makes more than the rest of the nation combined...
  Rebecca Blank, who recently left the President's Council of Economic Advisors, pointed out, ‘We've gone back to levels of income and wealth inequality that this country hasn't seen since the teens and 1920s.’" [Source: Merrill Goozner, Crash of '99?, Salon.com, Oct. 1, 1999; addendum: since 1999, the date the source was published, the situation is much, much worse. Today --just ONE PERCENT own more than 95 percent of the rest of us combined. GOP incompetence and criminality moves so fast these days, it's hard to keep up!].
• The top one percent of Americans receive more income than the bottom 40 percent. [Source: Korten, David. When Corporations Rule the World, p. 108].
• Federal Reserve median family net worth by percentile for 1992, 1995, 1998, 2001 (Federal Reserve Bulletin January 2003, pp. 1-36). Note the small gains for the bottom 75% of the population and larger gains for the upper 25% and that the 1998 to 2001 gains were largest.

  --US Wealth Distributions 1989-2001

Republicans bought the scam because it made them feel good about being greedy, shallow bastards. The appeal is obvious: trickle down rationalized greed but only after the fact; it made one feel good about one's worst impulses, motives, and elitist bigotry.

To his credit, the Sr Bush called the Laffer Curve 'voodoo economics'. Two politicians, however, bit big. One of them was Ronald Reagan . The other was the Jr Bush, the Shrub, the idiot left behind!

It is a GOP promoted myth that the GOP does not pay attention to 'polls'. That they promote it, proves it's a myth and that 'trickle down' itself is a deliberate lie by which wealth is transferred upward. It the mechanism by which GOP pays off its base! Not surprisingly, trickle down tested well in focus groups. Everyone likes pie in the sky and greedy bastards will always support any measure that is sure to enrich themselves at the expense of those who must work hard for a living.

Republican campaigns are driven by polls, focus groups, and market research. They're rich; they can afford it. Modern sophistry --the teaching of politicians how to lie, how to con the media, how to couch a phrase or deflect a point --was and most surely remains a growth industry.

The Laffer 'curve' was worse than fiction, it was a fraud. But the 16 month long depression which resulted is a disastrous effect that is still with us.

• New job creation under Reagan was 2.1% per year compared with Bill Clinton's 2.4% job creation rate.
• Reagan's showing, however, may be misleading; almost half of those jobs were in the public sector. In other words, Reagan , though he had promised the opposite, added nearly 2 million jobs to the Federal Bureaucracy. Reagan GREW the government --but NOT the economy.(Incidentally, job growth under Bush Sr, was a mere 0.6% --the worst performance since World War II. ) Reagan tripled the national debt and left huge deficits to his successor --Bush Sr whom Reagan blamed for what can only be called the Bush/Reagan recession.
  
• The disparity between rich and poor grew during the Reagan regime, narrowed somewhat during Clinton but exploded nova-style under Bush Jr.
• Almost one half of all American taxpayers were victimized by Reagan 's so-called tax reform; in other words, over 40 percent of those workers had a bigger chunk taken out of their check at the end of Reagan 's misrule than was taken out at the beginning of his regime.
• And what about "real wages", i.e, income adjusted for inflation? That declined as well.

The Presidency of Jimmy Carter is often tarred with a made-up, focus group word that has a GOP stench about it: 'stagflation'. Diplomatically, 'stagflation' is a myth and will remain one until I find the memo that proves that it was all just made up, validated, perhaps,by a focus group. In any case, it is a GOP fabrication with which the GOP would forever tar the Carter legacy. In fact Carter is among the best US Presidents in economic terms. Here are the FACTS that the paid liars of the GOP will not tell you:

Job Growth Per Year Under Most Recent Presidents⁸

Johnson   3.8%
Carter    3.1
Clinton   2.4
Kennedy   2.3
Nixon     2.3
Reagan    2.1
Bush      0.6

-- Bureau of Labor Statistics, Current Employment Statistics Survey

Stagflation, my ass!

How the GOP Exported Your Job

But, it is objected, the 80s were a period of great prosperity and, surely, Reagan 's tax cut must be credited! The quick response: the 80s, adjusted for inflation, were, in fact, a period of stagnation, increased poverty, and lost job opportunities defined by the export of US jobs, primarily Japan and China.

This was a point about which Milton Friedman reacted very testily, defensively when pressed about it in the grand ballroom of one of the luxury hotels in Houston's famous Galleria. I know. I was there! Friedman said that US jobs are not exported. He was either wrong or excessively pedantic! It was not --after all --a meeting confined to professional economists. For those who must work for a living, Reaganomics represented in a very real and practical sense the export of his/her job! For the real story about the phony 'prosperity' in the 80s, check out: Playing with the Numbers, How So-called Experts Mislead Us about the Economy, Richard A. Stimson

Reagan 's legacy lives:

• US manufacturing is all but non-existent as the shelves of Wal-Mart remind every shopper!
• Labor never regained a pre-Reagan living standard
• wages never kept pace with inflation
  
• 'good paying' and/or skilled jobs never rebounded.

The US had only begun to recover in Clinton's second term. [Bureau of Labor Statistics, BEA; summarized by Kangas, Economic Performance] It was left to Bush Jr, then, to finish the job that had begun with the administration of Ronald Reagan, that is, the collapse of the US economy.

The US boasts the world's largest NEGATIVE current account balance while China boast the world's largest POSITIVE current account balance. [CIA, World Fact Book, Current Account Balance] China owns us! China props up the buck because it is still in their interests to do so. China will pull the plug on the buck when it is in their interests to do so! As a result of the GOP policies of Ronald Reagan , Bush Sr and Bush Jr, the US has become a vassal state even as it indulges the delusion of empire! Pathetic!

Supply side --though discredited --reared its stupid head again some twelve years after Bush Sr. failed to grasp the simple maxim:

It's the Economy, Stupid!

For measuring the economic welfare of individuals rather than the strength of the nation, it is necessary to convert the national measure to the amount per individual, family or household. Otherwise, a nation could double its GDP and its population without anyone benefiting. Such an individual measure is real per capita GDP, obtained by dividing real GDP by the population, and this can be very useful for comparisons over time, although it contains the same weaknesses as GDP itself.

Another such measure is per capita personal income, which is the share each individual receives, on average, of total personal income. The latter parallels GNP and GDP, differing only moderately because of adjustments explained in first-year college economics courses (for example, corporate retained earnings and some taxes are deducted, while Social Security benefits, private pensions, and welfare are added).

A paradox almost always arises during recessions. Wages are stagnant, unemployment grows, and yet the media broadcast and print government reports of increasing per capita personal income.

This misleading result can be explained by considering the average income of a population of two: namely, billionaire Bill Gates and almost anyone of the rest of us. Take the total, divide by two, and you have an enormous amount. If Gates adds another billion it raises the average but does nothing for the other individual.

Rising per capita personal income during recessions reflects the gains being made by a small fraction of the population, which are enough to offset the losses of all the rest and thus bring up the average.

A per capita figure has the characteristics of a simple average (the arithmetic mean), but people’s economic well-being depends on how evenly or unevenly the fruits of production are shared in the population. For this reason, the median (that is, the value at the middle of the range, with as many lower instances below as there are higher instances above) is a better measure. It is available statistically in the form of median family income and median weekly wages and salaries.

Another complication is that when a household has more wage-earners and/or people work longer hours, often taking more than one job at a time to make ends meet (as has been happening to an increasing degree), a given amount of real income is not as beneficial as when it came from fewer hours.

--Playing with the Numbers, How So-called Experts Mislead Us about the Economy, Richard A. Stimson

Die hard, embittered supply-siders tried to effect a coup by impeaching a popular President who presided over the creation of some 35 times the number of jobs than were created under Bush Sr! The coup didn't work, of course, but the die-hards failed to get the message.

It's the Stupid Economy!

Following the closest election in the history of the nation, an election in which the winner was defined [by Scalia's 'majority opinion'] as the one getting the fewer number of votes, a mediocre, self-described 'retail politician' of few achievements and fewer ideas presumes to lead a nation while declaring:

"This would be a lot easier if this were a dictatorship...and I was the dictator!"

Those are the words of a someone who places loyalty to his ideological party and his corporate constituents above his loyalty to his nation. This is the kind of man who subscribes to "supply side" economics because it justifies his largesse to his corporate sponsors --the Enrons who bought him a public office.

But --it is hard to comprehend the near mass hysteria that accompanies debate on this issue --exploited as it was by Bush Jr's hero, Reagan, who somehow managed to make people feel good about themselves, when, perhaps, they should not have.

Reagan, Bush Sr and Bush Jr, indeed, the GOP, must take the responsibility for the US debt which was, last time I checked, some 7.4 trillion dollars, the highest in US history, perhaps World History. Since Ronald Reagan bankrupted the nation, the US has been a net debtor nation which survives, literally, at China's whim.

You can pay off your old credit cards with new ones for as long as you can find another card willing to extend you credit! Eventually, however, someone will refuse, and you will have to cough up the cash --and, if you can't cover what's due by selling off your assets, you must declare bankruptcy. The US is bankrupt!

Why was the US able to sustain the fraud for so long? Europe was willing to buy our T-Bills because the world's fuel --oil --was traded in dollars. Nations wanting to buy oil, had first to exchange their currency for dollars as oil producer nations demanded payment in US dollars. A crack in the dike was the creation of the Iranian 'oil bourse' where oil would be traded in currencies other than the dollar. That and other less publicized moves explains US antipathy toward Iran and US determination to seize the oil fields of Iraq, specifically, the Bush/Cheney/Carlyle/Halliburton attempted "oil grab" in the Middle East --the raison d'etre for war, the plan behind the convenient pretext called '911'. The history of the US since 1980 is the history of US attempts to seize and/or dominate the world's oil resources and markets.

This was all predictable! It was shortly after the US attack and invasion of Iraq that I posted the following comment on one of NPR's long defunct 'How's Bush Doing Board'.

The most absurd invention in the history of technology --the SUV --will go out of fashion overnight --and so will jobs!

It will make the Great Depression of Herbert Hoover --another GOP charlatan --look like a casual walk in the park.

Nixon Ends US Agreement with Bretton Woods

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A Feast of Unrepentant Wingnuts

by Len Hart, The Existentialist Cowboy

Egalitarian societies are more productive than societies in which a mere one percent owns more than some 90 percent of the rest of the population. Since 1980, US productivity declined with the dollar in a race to the bottom. The results may be seen quantified at the CIA's 'World Fact Book' where the US is at the bottom of a list of nations with the world's largest negative current account balance. It is not coincidental that America became the world's largest net debtor nation as it joined the ranks of the most inequitable.

American politics has been hijacked by a tiny coterie of right-wing economic extremists, some of them ideological zealots, others merely greedy, a few of them possibly insane. The scope of their triumph is breathtaking. Over the course of the last three decades, they have moved from the right-wing fringe to the commanding heights of the national agenda. Notions that would have been laughed at a generation ago--that cutting taxes for the very rich is the best response to any and every economic circumstance or that it is perfectly appropriate to turn the most rapacious and self-interested elements of the business lobby into essentially an arm of the federal government--are now so pervasive, they barely attract any notice.

The result has been a slow motion disaster. Income inequality has approached levels normally associated with Third World oligarchies, not healthy Western democracies. The federal government has grown so encrusted with business lobbyists that it can no longer meet the great public challenges of our time. Not even many conservative voters or intellectuals find the result congenial. Government is no smaller--it is simply more debt-ridden and more beholden to wealthy elites.

--Feast of the Wingnuts: How economic crackpots devoured American politics

The US won the race to the bottom begun with the ascension of Ronald Reagan to the White House.

In 1981, the top federal income-tax rate was 70 percent. Today it is 35 percent. Looked at in another way, the retention rate — the rate of income that individuals keep after taxes — went from 30 percent to 65 percent, an increase of well-over 100 percent since 1981.

Rohmann goes on to identify what he calls a “corollary hypothesis,” the so called trickle-down theory, where greater spending and investing power unleashed by tax cuts for those at the top of the economic ladder eventually “trickles down” in the form of increased employment, benefiting all of society. The term “trickle down” is a derogatory term invented by detractors of supply-side ideas. An appropriate description of the effects of supply-side policies was captured by John F. Kennedy in reference to the importance of economic growth in driving up the well-being of all Americans. Said JFK, “a rising tide raises all boats.”

--Tom Nugent, Laffer Lines

The US will remain on bottom or eventually collapse entirely unless and until it repudiates the failed and incompetent policies that got us there!

Egalitarian societies are more productive. Higher employment makes possible increased spending and supports economic expansion from the bottom up --not from the top down!

US wages have stagnated for the past three decades, while the
work force has also faced an erosion of job security, health care, and pension plans. This increasing economic insecurity has coincided with rapid globalization. Is there a causal relationship between the two? This policy brief probes domestic and international economic changes over the past half century to argue that the main causes of eroding US living standards have been “made in the USA,” as the postwar consensus in favor of egalitarian economic policy has broken down.

The domestic consensus that supported a relatively egalitarian US economy and good living standards for a broad middle class had seriously eroded before the current phase of globalization began. Globalization revealed and exacerbated, rather than created, the basic problems with the US system.

...

Currently, over 30 million workers—one-fifth of the US work force—earn less than the $9.80 per hour that would be required for a sole wage earner to lift a family of four out of poverty. The minimum wage should also be indexed to inflation and increases in worker productivity. This productivity link would help to distribute the gains from productivity more broadly across the economy and correct the disproportionate capture of gains by investors and corporate executives. This would be good for both low-income households and domestic demand. If the minimum wage grew with average productivity gains, it would also steer capital toward more productive firms that succeeded by increasing the productivity of minimum-wage workers rather than toward firms relying on sweatshop wages. This would increase the overall efficiency of the economy.

--US Living Standards in an Era of Globalization, Sandra Polaski, Senior Associate and Director, Trade, Equity, and Development Project, Carnegie Endowment for International Peace

Of course, I deny that anyone can lift themselves, let alone a family, out of poverty on some nine bucks per hour. Nevertheless, Polaski makes her point succinctly and effectively.

The Rise of Reaganism; the Fall of America

Since Ronald Reagan, GOP tax cuts have benefited only the upper classes, an increasingly tiny percentage of the population, now just one percent of the entire population. The promise that these 'tax cuts' would trickle down or result in increased investment and thus jobs was not merely false but disingenuous. The right wing [GOP] leadership knew better but proceeded in any case. It was apparently a quick and painless way to pay off the base for its continuing support.

The term 'supply side economics' is just an advertising slogan focus group tested for its effectiveness. The theory itself is said to have been cooked up by Arthur Laffer and drawn on a napkin.

Starting in 1972, Wanniski came to believe that Laffer had developed a blinding new insight that turned established economic wisdom on its head. Wanniski and Laffer believed it was possible to simultaneously expand the economy and tamp down inflation by cutting taxes, especially the high tax rates faced by upper-income earners. Respectable economists-- not least among them conservative ones--considered this laughable. Wanniski, though, was ever more certain of its truth. He promoted this radical new doctrine through his perch on The Wall Street Journal editorial page and in a major article for The Public Interest, a journal published by the neoconservative godfather Irving Kristol. Yet Wanniski's new doctrine, later to be called supply-side economics, had failed to win much of a following beyond a tiny circle of adherents.

That fateful night, Wanniski and Laffer were laboring with little success to explain the new theory to Cheney. Laffer pulled out a cocktail napkin and drew a parabola-shaped curve on it. The premise of the curve was simple. If the government sets a tax rate of zero, it will receive no revenue. And, if the government sets a tax rate of 100 percent, the government will also receive zero tax revenue, since nobody will have any reason to earn any income. Between these two points--zero taxes and zero revenue, 100 percent taxes and zero revenue--Laffer's curve drew an arc. The arc suggested that at higher levels of taxation, reducing the tax rate would produce more revenue for the government.

...

At that moment, there were a few points that Cheney might have made in response. First, he could have noted that the Laffer Curve was not, strictly speaking, correct. Yes, a zero tax rate would obviously produce zero revenue, but the assumption that a 100-percent tax rate would also produce zero revenue was, just as obviously, false. Surely Cheney was familiar with communist states such as the Soviet Union, with its 100 percent tax rate. The Soviet revenue scheme may not have represented the cutting edge in economic efficiency, but it nonetheless managed to collect enough revenue to maintain an enormous military, enslave Eastern Europe, fund ambitious projects such as Sputnik, and so on. Second, Cheney could have pointed out that, even if the Laffer Curve was correct in theory, there was no evidence that the US income tax was on the downward slope of the curve--that is, that rates were then high enough that tax cuts would produce higher revenue.

--Feast of the Wingnuts

Thus was removed from the economy revenues/monies that might have driven expansion, growth, or the creation of new jobs had any class but the increasingly tiny elite benefited. The utter failure of 'trickle down/supply side economics' has proven that for the US industrialist, a tax cut is just a windfall --not an incentive. Such windfalls are simply transferred offshore to numbered accounts or other dodges. If 'demand' had justified additional investment in equipment or labor, the industrialist would have already made the decision and taken the 'investment tax credit' up front. There is no need to wait for tax cuts. Therefore, GOP tax cuts misstate the issue, compound the problem and are at the root cause of the decline and fall of American productivity, living standards and 'would-be' empire.

Glyn identifies five internal constraints on an egalitarian economic policy: (1) sluggish private capital accumulation, (2) conflicting claims, (3)government deficits, (4) financial markets, and (5) taxation and the costs of expansion. Each of these items sounds familiar. It is as if nothing fundamental regarding the economy's structure has changed since the early 1970s. In varying degrees, each of these constraints was present then, and the implication is that the only barrier against returning to the relatively more egalitarian economic outcomes of that period is changed political climate.

--The Unbalanced Economy: Business Domination as the Real Constraint on Egalitarian Policies, Thomas I. Palley, Assistant Director of Public Policy, AFL-CIO

Wal-Mart rose as American purchasing power and the dollar fell. Not coincidental. The CIA's 'World Fact Book' puts the US as the bottom of a list with the world's largest negative current account balance. Of equal importance is the overlooked fact that Wal-Mart is patronized by the American working class which is impoverished of late. Again --not coincidental.

In better times, the American working class, especially highly skilled auto workers or steel workers, might have patronized a better version of Wal-Mart where moneys spent remained in the community and enriched it. But Wal-Mart is not a characteristic of 'better times' It is a symptom of America's broken promise and economic demise.

The rise of the GOP, however, seems to have confirmed David Ricardo 's theory of wages in which it was said that wages represented 'labor's natural price —the income which is necessary for the worker to exist'. Not surprisingly, capitalists agreed with Ricardo but only because he seems to support the idea of 'subsistence' wages, keeping workers poor, impoverished, hungry. Things have only gotten worse. Today's capitalist thinks the prototypical conservative Ricardo 'pink' for daring to ascribe to labor any value at all. Even so, it is difficult for even robber barons to ignore the verifiable fact: wealthier workers spend more on a better life. Paying subsistence wages 'contracts' the economy --a recipe for depression. Capitalists are blind and stupid if they insist upon keeping workers poor. Economies are driven by purchases. Poorer people purchase less. Economies contract. Depression results. Basic economics. GOP stupid. GOP blind and dumb.

The Wal-Mart Leech Exposed!

The rise of Wal-Mart is the inverse of the loss of domestic purchasing power. It is a race to the bottom and we've won it! It is said that demand is created when the people have discretionary spending. More accurately, discretionary spending may facilitate or 'satisfy' demand but must not be confused with demand itself.

If one has 'everything' no additional amounts of money will encourage spending; 'tax breaks' for those already among the top one percent will simply wind up offshore. The net effect on the domestic economy is one of 'contraction' i.e, recession/depression. People have diminished capacity for 'discretionary spending' when jobs are exported and the value of the dollar declines as a result. Again --economies contract. Depression results. Basic economics. GOP stupid. GOP blind and dumb.

During WWII, Adolph Hitler derided the US manufacture of refrigerators and other appliances. On another occasion, he and Albert Speer BLEW PAST a US made auto on the new autobahn. In a German Mercedes, Hitler and Speer left the US car in the dust amid great laughter and ridicule. [ src: Inside the Third Reich] The significance of that is that prior to the outbreak of WWII, US auto manufacturers were selling cars in Europe if they were not of Mercedes quality. Some went too far. Henry Ford, for example, helped finance Adolph Hitler who proudly displayed a portrait of Ford in his new Chancellery. I can tell you from experience, you will see precious few US made cars on any major thoroughfare or street in Europe.

As we have established, the most egalitarian societies are most productive. Conversely --those societies, like the US, in which just one percent owns more than 90 percent combined are least productive. Even conservatives in America will tell you: 'if you want a prosperous economy, you must create wealth', a true statement that does not go far enough. It is labor that creates wealth or, if you prefer, value. This is the 'labor theory of value' espoused by almost every major economist from David Ricardo to Paul Krugman, from Karl Marx to John Maynard Keynes. Wealth is created by work alone! If you wish to create wealth with money, you must first put money to work with productive, domestic investment --not offshore dodges.

Wealth is not created by transferring the products of labor upward to the increasingly tiny clique of moneyed elites --just one percent or less of the entire population. Wealth is not created by exporting jobs or by undermining local merchants with Faustian bargains and/or Wal-Mart. Wealth is not created by shipping it offshore to benefit only those who have never worked. Wealth is not created by 'screwing' the working, productive classes, robbing them of jobs, educations, and futures.

Under GOP mismanagement, dishonesty and incompetence, the US has done everything that DOES NOT create wealth while unfairly burdening those who do! Wealth is not created with tax cuts for those already rich. That strategy inevitably results in 'economic contraction'. As Reagan said: here we go again --economies contract. Depression results. Basic economics. GOP stupid. GOP blind and dumb.

Insanity!

Ideologues work backward from conclusions in a frantic search for premises to prove them. Sane, rational, pragmatic or scientific folk will begin with facts rather than conclusions. Wealth is created when wealthy folk are taxed fairly and when working consumers have purchasing power to buy things with the moneys they earn. The GOP system is a race to the bottom. As the rich get richer and the poor, poorer only Wal-Mart prospers by brokering the transfer of US wealth to China. To drive the point home: economies contract. Depression results. Basic economics. GOP stupid. GOP blind and dumb.

It has been aid that when conservatives cut taxes, they cut them for everyone. That has never been true. Ronald Reagan's 'tax cut' resulted in my paying higher taxes, a much higher percentage of my income. That was true primarily because 'breaks' are called 'loopholes' if an individual avails themselves of them, but 'tax incentives' if it is the big corporation that benefits. In any case, across the board tax cuts are meaningless as long as the range from poor to very, very, very rich is plotted on increasingly steeper curves. [See: the L-Curve]

As a percentage of income, everything is cheaper for the rich!

Because billionaires spend infinitesimally less as a percentage of income just staying alive as do those who work, the benefits of a tax cut accrue only to the wealthy. Only a progressive tax addresses this injustice. As a percentage of their income, the prices rich folk pay is much, much, much less than you pay for just about everything. A restaurant meal, for example, is a negligible expense for the wealthy, a precious and expensive luxury for those in the middle class.

As they grow richer, elites bid up the prices of properties and/or goods, a process that puts necessities beyond the reach of the poor, and makes them a luxury for the middle class. In the late fifties and early sixties, thirty thousand dollars would put you in a very fine, two story home in an excellent neighborhood. A comparable home today will cost you millions. If this increase were merely inflationary, your income would have kept pace and kept you in the market. That it did not has created super enclaves affordable only to the super rich.

As recently as 1967 a distinguished economist observed that there were increasingly fewer status symbols available to millionaires that were not also available to someone earning $20,000 per year. A rising tide, it would appear, does not raise all boats.

Moreover, the ruling elite of just one percent of the population has access to tax dodges and offshore accounts that those who work for a living may never have even heard of.

The first bailout gave these companies over 700 billion in bailouts and the main culprit of the insurance derivative fraud AIG that primarily caused the disaster received 150 billion dollars of taxpayers money.

More than 83 corporations have offshore subsidiaries where their funds are protected in tax havens in the Caymen islands such as: The Bank of America, Citigroup, Morgan Stanley, AIG, JP Morgan Chase, Wells Fargo, and even Pepsi and General Motors who received 13.4 billion have hundreds of millions of dollars in tax havens offshore. All those corporations receive protection from paying the US government their taxes and the loss to the US is into the 100 billion dollars of lost tax revenue.

Senator Carl Levin a democrat from Michigan and Byron Dorgan, Democrat of North Dakota requested the report to be released and are pushing for new laws prohibiting these bailout scam corporations from being tax dodgers while asking for bailouts from the taxpayer.

--Bailout Corporation Tax Havens in Caymen Islands

It is no coincidence that the US was most productive when it was most egalitarian and that was the era that began with the end of WWII and ended with the inauguration of Reagan.

The automobile industry successfully converted back to producing cars, and new industries such as aviation and electronics grew by leaps and bounds. A housing boom, stimulated in part by easily affordable mortgages for returning members of the military, added to the expansion. The nation's gross national product rose from about $200,000 million in 1940 to $300,000 million in 1950 and to more than $500,000 million in 1960. At the same time, the jump in postwar births, known as the "baby boom," increased the number of consumers. More and more Americans joined the middle class.

--The Post War Economy: 1945-1960

Democracy is always the first victim of militarism. Today, Germany, which is said to have lost WWII, is the world’s largest exporter of manufactured goods, ahead of China for whom the US is just a place to dump product while polluting its own environment. To make the point even more dramatically, German wages and benefits today are higher than those in the US even as it maintains a much higher and better 'safety net'.

Back in February–when even the mainstream media was convinced the capitalist economy was in full-blown meltdown mode–Newsweek magazine ran an article titled “Why there won’t be a revolution.” Newsweek wanted to reassure the rich–and convince working people–that the masses weren’t getting ready to dust off their pitchforks and head to the town square.

“Americans might get angry sometimes,” they wrote, “but we don’t hate the rich. We prefer to laugh at them.”

Newsweek couldn’t be more wrong. The 10 percent of Americans who rely on food stamps, the 25 percent of Ohioans who are waiting in lines at food banks, the 500,000 people who lost their jobs last month and the millions more who can’t find work–these people aren’t laughing.

And plenty of Americans–rightly–hate the rich. While our homes go into foreclosure, while our credit card rates go up, while our jobs disappear and college tuition shoots up, the well-heeled “masters of the universe” on Wall Street are still making out like bandits, but now with hundreds of billions of dollars in taxpayer money, courtesy of the Obama administration.

A lot more people would be even angrier if the mainstream media reported the truth about the rich and powerful in America–who they are and how they “made it” to the top. Consider the 10 richest people in the country as of last September, according to the annual Forbes magazine list.

--Adam Turl, How the Other 0.00000003 Percent Lives

The US economy--in obvious decline since 1982 --is 'fragmented, inefficient. Health care has become a luxury that the working classes cannot afford. US investment in research and development is dropping precipitously as a share of GDP. The result: US product quality continues to deteriorate and markets for US goods will continue to decline because of it.

"War is a racket!"

Concurrently, democracy itself is threatened. 'Presumed external' enemies have been exploited to justify subsidies given the Military/Industrial Complex. A crack down on dissent has threatened to undo the US Constitution, called a 'goddamned piece of paper' by the incompetent liar who had recently sworn to uphold it. As America's future dims, there is no 'mea culpa'. There is no remorse. There is no lesson learned. We are not a feast fit for the gods; we are, rather, burgers and fries for unrepentant wingnuts.

Gen. Smedley Butler was precise and correct when he said: "War is a racket!" It's not about external threats, it's about CONTRACTS. As long as industrialists make money facilitating the mass murder of human beings, there will be NO peace! EVER!

Trickle Down Theory Debunked

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