An editorial in today’s Boston Globe begins,
THE EARLY DAYS of the Bush administration seem like another era: no Sept. 11 attacks; no war in Iraq; no Hurricane Katrina; no $317 billion deficit. The president’s chief ambition early in 2001 was to cut taxes deeply to soak up large budget surpluses. Yesterday, two sections of that law took effect, and will reduce taxes for the wealthiest Americans by about $27 billion over the next five years.
After you’ve digested the Globe editorial, take a look at this post by Hale Stewart discusses a Congressional Budget Office study that proves “supply side” doesn’t work, and cutting taxes does not stimulate the economy sufficiently to make up the loss of revenue. If the government cuts taxes, it loses revenue. Simple as that.
At the New York Times, via True Blue Liberal, Bob Herbert shows us how Congress is attempting to pump federal revenues — by sacrificing the poor.
Consider the budget that will soon be sent to the president for his signature. Members of the House and Senate have agreed on legislation that achieves something approaching $40 billion in savings over five years primarily by hammering the sick, the poor, the elderly and college students and their families.
This is the same Congress that genuflects each time the president asks for yet another gift-wrapped tax cut for the wealthiest among us. The textbooks tell us that the U.S. is a representative democracy, but only the upper strata are truly represented.
The nearly 800-page budget bill would allow states to jack up the premiums and co-payments of millions of low-income Medicaid recipients. It would also allow some Medicaid benefits to be rolled back.
One of worst aspects of the Medicaid provisions is that large numbers of poor people, faced with the higher premiums and co-payments, will inevitably decide to take a pass on the health care they need. Some will die.
But others are doing very well, of course, as described in this editorial in today’s NY Times, which begins:
There is no shortage of numbers and studies detailing the widening gap between what American companies pay workers and the millions of dollars those same companies pay top executives. But just in case anyone hasn’t been paying attention, here enters David Brooks, chief executive of the bulletproof vest manufacturer DHB Industries Inc., to provide a fuller picture.
Thanks to defense contracts, Mr. Brooks (not to be confused with Bobo, the Times’s famous keyboarding vegetable) is a fabulously wealthy man. He recently threw a $10 million private party for his daughter and her friends at the Rainbow Room at Rockefeller Center. Meanwhile, much of the body armor Brooks sold to the DoD has been recalled for being defective.
The editorial continues,
Meanwhile, the party came less than three months after the release of a report on ballooning pay for chief executives that singled out Mr. Brooks for making $70 million in 2004 compared with $525,000 in pre-Iraq-war 2001. The report said he made an additional $186 million in 2004 selling company stock.
The same report, by the Institute for Policy Studies, a left-leaning research center, and United for a Fair Economy, a group seeking to narrow the gap between rich and poor, found that in 2004 the ratio of C.E.O. pay to worker pay at large companies had ballooned to 431 to 1. If the minimum wage had advanced at the same rate as chief executive compensation since 1990, America’s bottom-of-the-barrel working poor would be enjoying salad days, with legal wages at $23.03 an hour instead of $5.15.
One of the conceits of winger philosophy is that people are rich because they deserve to be rich, and vice versa. Wealth naturally finds its way into the hands of the virtuous and hard-working. Another conceit is that markets must be “free” and business unregulated to allow “nature” to take its course; oversight and regulation interfere with the mandate of heaven, as it were, and cause wealth to flow to people who don’t deserve it. This is not just bad economics; it is immoral, they say.
Republicans must think they are doing God’s work by tweaking law and public policy to be sure the wealthy get wealthier, and the poor are punished for being poor. Why this is any less “artificial” than regulations keeping business honest and preventing exploitation of labor isn’t clear to me, but then I’m not a Republican.
In Republican World, war profiteers are God’s Chosen People. If Defense Contractor Brooks is making lots of money in spite of the fact that he sells defective products that put our soldiers at risk, it’s God’s Will. And blessed are them that inherit big bucks, because they are virtuous and wise and deserving by birth and don’t have to work at it real hard.
And has anybody else noticed how many of the leaders and spokespeople of today’s conservatism are the children of the leaders and spokespeople of yesterday’s conservatism? Well, it worked for them, huh? Can’t argue with success.
See also: Los Angeles Times series on how economic changes in the U.S. have shifted financial risks.