The Angry Liberal Commentary Archive:
Economic Stimulus: The Rich get Richer. . .Again
Suppose you just discovered that your house caught on fire. You quickly dial 911. Minutes later, sirens blaring and lights flashing, several fire trucks screech to a halt in front of your home. Oddly enough, the fire trucks are all manned by congressional Republicans. Suddenly, George W. Bush jumps out of the lead truck, his helmet and ax at the ready. As the Republicans race toward your door, they begin to strip off their fire gear, revealing tuxedos beneath. They break down your door and quickly begin mingling. Caterers arrive with Champaign and caviar. A string quartet sets up near the growing flames in your living room. Limousines pull up and rich Republican campaign contributors leap out, joining the Republican congressmen and president in your house. As this group mingles and drinks, some partygoers accidentally spill Champaign on the flames. As the fire intensifies, more bubbly is uncorked, sending a spray of liquid in the general direction of the portion of your house that is burning. After your house burns to the ground , the Republicans leave. Still giddy, George W. Bush presents you with a bill for the party on the way back to the truck. Then they climb back into their limousines and fire trucks and drive out of sight.
What kind of stupid way is that to fight a fire, you ask? I hate to tell you this, but it is exactly how your Republican-controlled House of Representatives and your president treat the subject of economic stimulus. Instead of putting money in the hands of those who need it, the Republicans prefer to put it into the hands of those who don't, namely, corporations and their rich campaign contributors, in the hopes that the ensuing corporate party will "spill" enough cash to create some jobs and stimulate the economy.
Time for a little economic theory. Terrorism aside, the economy is slowing down for one reason: People aren't buying as much stuff. In similar situations in the past, businesses used to lower their prices until their products sold, trading profits for sales. This process, while adversely affecting corporate bottom lines, stimulated the economy. Sometime during the Reagan 80s, businesses decided that instead of lowering their prices during economic downturns, they would instead simply send their work force home until the products already on the shelves sold . This shifted the burden of the downturn away from the stockholders and toward the work force. Unfortunately, it also aggravated the economic slowdown since those unemployed workers were not buying stuff from other companies anymore.
If companies no longer have an interest in helping grow the economy, what is the best way for the rest of us to do it? Folks, this is simple. Put money back into the hands of those who are no longer spending it due to a lost job. This would return the nation's spending to normal, removing the products from the shelves and forcing job recalls to replace the falling inventories. In addition, the actual victims of the economic slowdown might actually be able to save their homes and cars from the repo man.
No wonder the Republicans hate this! Here's their plan instead: Businesses, which used to have to sell stuff to make money, are relieved of this burden with huge retroactive tax cuts. Why bother to lower prices when you can collect a big check from the government? Corporate revenue increases and the stuff on the shelves gathers dust. The problem is this: Since the products are still sitting on the shelves after this "stimulus," why would a corporation recall its work force? If nobody is spending money, why would an entrepreneur want to start a business? This money, given to corporations and rich people under the guise of creating jobs, would not do so because savvy businessmen don't start or expand businesses without some sort of increase in demand.
Best of all, the tab for this " stimulus" goes to the taxpayers! That's right, those who are suffering most under the economic slowdown will eventually pick up an extra share of the tab for attempting to jump-start the economy. Think about it: Run up government debt by cutting taxes for the rich, and when it comes time to pay off that debt, the rich pay back less because of their lowered tax burden. This isn't economic stimulus. This is the rape of the American worker.
It's really very simple. Rich people who donate money to the Republican Party do not do so to better the nation. They invest in Republicans much like they invest in stock, and they demand a return on that investment. Bush's tax cut, his first order of business after assuming power, was the first of many dividends to be paid to his investors. The economic stimulus package, unless the Democrats can stop it, will surely be the next.
. . .The Angry Liberal
12/06/01
