November 9th, 2009 :: Permalink
Americans have become the world's leading whiners. They refuse to do the hard work to educate themselves about the challenges we face; prefer to latch on to ideological belief systems that do not match facts on the ground, which has trapped us in two miserable wars that are bankrupting the nation while our national and state economies spiral into the abyss.
Our whining Hawai'i community now claims they are fed up "with the half-baked way these furlough days were enacted." Yes ... I warned that taking hatchets to state government would only make a structurally inefficiently system far worse. There were (and still are) better ways to bring our public sector into harmony with economic realities.
A significant percentage of our nation wants to follow the trifecta of fools, i.e., Beck, Limbaugh and Palin, who have learned there is gobs of money to be made by inciting our most uneducated and emotional citizens - people who have been frustrated for years - and who are ripe to be exploited.
Supply side economics (SSE) is crushing our nation. The theory says putting more money in the hands of our top performers, generally our most wealthy, will lead to more reinvestment in America: accelerating our economy, creating more jobs, and in turn, providing more revenue to investors, workers and government coffers. Clearly this did not happen and this fact is not in dispute.
We began this massive social experiment during the Reagan years. It failed then, forcing George H. W. Bush to commit political suicide, "Read my lips ... I will not raise taxes." He did and he lost.
SSE works - in theory. It might work in practice -- but the "system must be closed."
Under the principles of SSE we give unprecedented tax breaks to our most wealthy. The world's 2nd richest man, Warren Buffett, reported he paid a federal rate of 16.5 percent on his billions last year. Middle class employees working for Buffett's company paid a minimum of 25 percent.
Since our economic system isn't closed top investors do not return these tax savings to America. It's a simple explanation so I put it to you. If you were to receive a windfall of $1,000,000 and your objective is to generate the greatest return possible, where would you invest this capital? Proposal A will return 12%; Proposal B will return 4.5%; and the risk is similar.
Even those of us who aren't the brightest investors in the chandelier know Proposal A is the more profitable option.
Due to our global economy Proposal A is in Dubai; Proposal B is in America. This is what's happening to our economy. We are incentivizing our top investors to follow global currents of prosperity. U.S. jobs are following and we're leaving the middle class holding the bag.
As millions of good jobs have fled our shores there is intense competition for remaining work. This forces wages down. Since 1970 American worker productivity has increased by more than 60 percent yet wages have risen by only ONE percent adjusting for inflation.
Reagan found an Achilles's heal in our social consciousness and pointed his finger at government. His nine deceptive words about our public sector seemed gospel, since this national head of state had also led one of our largest state systems.
Reagan provided a smokescreen for an emerging corporatist class in America. Small businesses soon found themselves behind the competitive curve, as they could not achieve "economies of scale" similar to multi-billion dollar global corporations. Small business is the heart and soul of America. Their plight soon filtered into the American family.
With leaders blaming government taxes for the collapse of Ma & Pa businesses and with families witnessing the destruction of their purchasing power, it did not take long for this deception to become the accepted wisdom.
Government is the problem ... government is the problem ... yet government continued to grow larger under Reagan, Bush I and Bush II (dropping only under Clinton) while state and local government increased even more. America's demand for government services in this increasingly complex world appears insatiable and we recently suffered the biggest military buildup in decades. We simply do not want, and in many cases cannot afford, to pay the bill.
Good-bye Maui Land and Pineapple; good-bye Gay & Robinson sugar cane; good-bye tuna canneries on American Samoa. In the continued rush to the bottom our private sector seeks labor willing to work for $1/hr or less.
Good-bye Honolulu symphony; good-bye 180-day Hawaiian public school year for Keiki; good-bye courses and top professors at the University of Hawai'i. As we're increasingly pinched we decimate programs that prepare our future.
One Hawaiian voter's solution: If these furlough days work we should make them permanent.
Auwe!!! We are all going to get a better understanding of permanent if we do not change course immediately ...