The tax cut was advertised as a means to jump-start the economy. The question I have is "which economy?" because we now have two: the Wall Street economy and the Main Street economy.
The tax cut was advertised as a means to jump-start the economy. The question I have is "which economy?" because we now have two: the Wall Street economy and the Main Street economy. The tax cut definitely helped the Wall Street economy; it did nothing for the Main Street economy. Why?
The Grand Old Party (GOP) invented the "trickle down theory," on which the tax cut was based on, over eighty years ago. It has never worked for then and never will. It did not work in the 1920's, the results were questionable in the 1980's, and it certainly did not work in 2002.
We have proven American history that the opposite works. In the early 1900's, Henry Ford (a Republican) almost doubled the wages for his workers. The result was that employees were more productive, cherished their jobs, and were now able to buy the very cars they were making. Increased worker spending added buoyancy to the market and helped trigger the economic expansion of the industrial age.
Amazingly enough, the concept was proven once again by the US Government in the most unlikely of places + Iraq. The Iraqi economy is booming. Why? Because the US government dramatically raised the wages for those who worked under Saddam's regime. These people now have the money to buy new furniture, construct additions to their homes, and purchase many necessities that had been deferred. The results are clear + these methods of spending create real jobs.
Right here in the United States, we are so far behind on creating real jobs. We continue to receive false advertising on how wonderful the job market is growing. After the Administration took office in 2001, they lost 3,000,000 jobs. More importantly, normal job growth as a result of growth in the population equals 200,000 jobs per month or about 8,000,000 jobs over the period the Administration has been in office. With normal growth, we are short by about 11 million jobs less than the 2 million "new" jobs bragged about by the Administration. Thus, we are 9 million jobs short. The resulting oversupply of labor has driven down wages to the point where workers no longer earn a living wage.
The rest of the story is a bleak picture. These 2 million newly created jobs consist of a combination mostly of government jobs and low wage, part-time jobs. One report claims that 70 percent of new jobs are part time jobs only. A job without a living wage adds nothing to the economy. Even financial markets on Wall Street understand the need for job growth. According to the Wall Street Journal, "Experts say job growth is needed to keep revenue (and corporate) profits rising over the long term." A key phrase "keep revenue rising" cannot occur if we increase jobs and lower our overall aggregate of wages. Thus, we not only need 9,000,000 more jobs, we also need a living wage. The result would be a win for Main Street economy and a win for Wall Street economy.
Finally, the Administration has said that exporting jobs is good for the economy! "Which economy?" I ask myself? It's temporarily good for the Wall Street economy, not the Main Street economy. For me, Main Street comes first. Others say that if wages increase, our jobs will leave the country because of our North American Free Trade Agreement (NAFTA) agreements. If changing NAFTA or not changing NAFTA helps the workers of our nation, then I support that change.
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