Ah that Sarah Palin busing around America, making lots of money, and fibbing in her speeches. One of the last whoppers was that President Obama had increased the debt more than all other presidents combined. Senator John Kyl also said it a couple of years ago. Here’s the data. When Obama took office the debt was $6.3 trillion and now is 9.7 trillion; 3.4 trillion more. The total debt, including what we owe ourselves was $10.6 trillion and has grown to $14.3 Trillion, and increase of $3.7 trillion. All and all it is still a lot of money and gives us a very big problem in a world wide economy where folk are loosing confidence in us to handle our own financial affairs.
If you compare apples to apples in terms of increases in national debt remember that the national debt doubled under the Bush administration and tripled under the Reagan administration. And a good deal of Obama’s debt comes from those previous policies.
We live in a very rich country capable of caring well for all its citizens. So what do? We give tax cuts for the wealthy and cutbacks to program for those in need. I have written these numbers before but they need to be repeated until we get it. Over half the wealth of this country is in the hand of the top 10th of the top 1% of the country. The middle class is shrinking and its standard of living has dropped over the last 3 and half decades. The poor are getting poorer. We need to tax the millionaires and billionaires at a more sensible level and tax the heck out of the ultra ultra rich which seem to have plain bought the government, a government that continues to subsidize the rich at the expense of the rest of us.
I understand the anger of the Tea Party but they and we have been flimflammed by supply side economics the Reagan began. Sarah Palin, if you really want to do some good for the country repaint your bus to said, “Raise taxes on the rich.” But then you’re getting pretty rich on your tour and that would cost Grizzly Mom bucks.
What the Tea Partiers unfortunately don't understand is that the debt problem is actually a direct by-product of the wealth-concentration problem. For those at the top to be able to grow wealth any faster than the GDP growth rate would require the rest of the population to go increasingly into debt so there are more financial assets to be had. There's only so much business equity out there, past that most assets are someone else's liabilities. The balance sheet must balance.
ReplyDeleteLeft to its own, the natural tendency for the system would be to go through long cycles then where those at the bottom become increasingly indebted to those at the top until the system destabilizes, there's financial panic wiping out a lot of assets, and the system resets.
You can mitigate this, or even prevent this painful cycling altogether through a progressive tax structure that maintains financial stability, which we did for decades after the depression.
However the last few decades we've steadily done away with these stabilizing elements by cutting progressive taxes (like income tax) and increasing reliance on regressive taxes like property and sales tax.
The inevitable result of the supply-side exercise is dramatically increasing wealth concentration and the dramatic increase in public and private debt that is an inevitable part of that. The system becomes unstable.