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When people spend money the economy grows. The number of jobs that exist is actually just a cherry on the top of economic growth. This is highlighted in how last year, during a height of recession, the economy grew during Christmas. Mind you at this time there really were not many new jobs being created, if any at all. The reason the economy grew at the time was because people went out and invested in the economy by buying holiday gifts for their friends and relatives. This means that the important issue is that people have money to put into the economy to make it grow.
The government is not a business and therefore has only one source of revenue. Taxes. The people who spend the most money IN PROPORTION to their income are middle-class Americans, NOT the wealthy. The wealthy spend a shitload, true, but are also very often very happy to just sit on their income and let it gain interest for one simple reason, THEY CAN. I don’t blame them either, this is simply good management. They don’t have to worry about having reserved for themselves, the means to live. The middle-classes do. Therefore, if the middle-class is taxed more, since revenue to fix the deficit will have to come from somewhere, the middle-class will also have less money to push into the economy, in proportion to their income, to help it grow.
Spending cuts do nothing but make the deficit rise at a slower rate, effectively creating a band-aide; and there probably are some programs from which cutting spending, especially when there is a $14.3 trillion deficit, makes sense. I will discuss this later. These program cuts however could also be done in the field of military funding for example (i.e. places where it will not directly effect those who invest the most money in the economy which is in jeopardy). If there is less money going to benefit programs to aide the middle-classes though, the middle-classes will have to spend more of their own income on their own medical expenses, education, and other things; thus giving them less money to invest into the economy, causing more deficit problems. Remember public spending is primarily what causes an economy to grow, not much else; and the public can’t spend money that is being taken away from them in the form of taxation. All things considered it only makes sense to tax the wealthy their fair share. If for no other reason, they can afford it and aren’t really doing anything else with it.
The idea that taxing these wealthy individuals will affect job creation is a version of the “trickle-down” theory of economics and is a complete farce. This should be obvious since, especially RIGHT NOW, there are very few jobs being created and many wealthy individuals just received huge tax rebates. Tax rebates which even Lady Gaga couldn’t dream of making throughout her entire career as the biggest artist in the world; and that was just in one year’s tax season, think of the rebates they may have received during the 8 years when Bush was president. If they are not creating more jobs right now, what the hell are they doing with their rebates? I ask you now: how many new jobs have been created, in an economy that supposedly just hit a “brick wall of hiring” if trickle-down is in fact working?
Now to address the spending cuts that Republicans want to make. Their refusal to tax the rich seems in accordance with the economic landscape of the Bourgeoisie/Proletariat era of France (before their American-inspired revolution. Do you see the irony of this?). Truth be told though, there probably are some cuts which could be made. Hear me out. I don’t want the cuts, but at the same time, with such a huge deficit some things may have to get dropped in order to make a deficit reduction easier to bear.
I don’t know which cuts would be made. At the same time though, it only makes sense that there may be some unnecessary spending in certain benefit programs. Only though, because the laws were written by legislators, and other lawyers, who understand law and understand how to make legislation which is airtight, while still containing loopholes (more irony). This way if the laws get appealed, those lawyers who helped to write the laws can go work for the other side exploiting the loopholes they designed amidst airtight legislation (hello conventional corruption).
Also I’m quite positive that some unnecessary earmarks would have been added onto other bills passed with reference to benefit programs. I’m only positive of this because it happens everywhere else. For example, there could very easily be an earmark to make a city park in the middle of a bill to expand military funding. When said military funding bill goes through, so does the earmark. For this reason I could easily see something unnecessary being put into a completely unrelated bill to expand a social benefit program.
One last issue, and I think I’m on point here, but if there is something I’m missing in this part of the discussion please explain it to me: The idea of postponing the age at which one can apply for Social Security benefits. Though it sounds good in theory, in reality I think it’s a relatively barren idea. The way that social security works is: when you are younger, you don’t receive anything. However once you become eligible for the program you receive YOUR benefits through the taxed income of those who are still working:
This means that anyone who is say, 15, to anyone who is 64, will be taxed a small percentage of their income in order to pay for the benefits of those who are then eligible for the entitlement program. Now imagine that the age to be eligible for Social Security is elevated to 67 from 65. As far as I’m concerned this will only be yet another band-aide over the deficit issue. Yes, we will save money during the two years when the first generation, which is affected by the change, turns 65; after the two-year period though we will be in essentially in the same boat which we were in two years earlier, and roughly the same amount of new people will apply for benefits; just, in this case two years later than they would have if no changes were put into affect in the first place. True the age will be pushed back and this will make the total number of people on benefits smaller, but not very. For this reason, unless I’m missing something, this strategy to tame the deficit seems like a bullshit cop-out. (FYI, the system of Social Security I just described is essentially Universal Healthcare for the elderly, and I don’t remember the United States becoming a “communistic regime” since FDR instituted his New Deal, which is where Social Security originates from.)
Remember: if the public cannot put its own money back into the economy for circulation, the deficit will not be terminated. What it really comes down to is there is far too much outsourcing done by companies who make even greater profits than they would have if they hired unionized labor, and unionized labor adds so many complications (sarcasm)… When they outsource it obviously puts jobs which Americans could have somewhere else and therefore, if an American job is lost, an American has less money to invest into the American economy. To give a quick example, when you buy a can of soda it costs about a dollar generally. Guess how much it costs Coke or Pepsi to make that same can of soda… about 5 cents and that’s NOT an exaggeration. This coupled with a “stipulation” of low import tax rates on said corporations for outsourcing, gives our government less revenue to spend on social programs and gives the corps a lot more to go to the bank with. By the way, you might say that most of these cans of soda are manufactured by machinery, and you would be correct. However, what if the machine breaks down? You need a human mechanic to fix the problem wouldn’t you? By outsourcing, corporations save so much money by not having to deal with a mechanic who is backed by a union which gets him vacation days, pensions, health benefits, weekends off, minimum wage, etc.
You don’t realize how lucky we are in this country to have labor laws. Most countries whom companies outsource to have no labor laws and this, in addition to the fact that the outsourced country is more impoverished, is the reason why the labor is so much cheaper there. If we take our labor laws for granted we might lose them.
One last thing. Don’t ever call me an idealist or look down upon me for saying this shit. An idealist is someone who doesn’t have a full understanding of the world around him.