For many Republicans, it’s an article of faith that lower taxes on the wealthy stimulate job growth. But it is increasingly difficult to find economists who agree.
When the Bush tax cuts for the richest Americans were extended late last year, Republicans insisted that it would promote job creation. But the dismal, almost shocking fact is that there were only 18,000 jobs produced nationally in June, which is effectively a rate of zero new jobs for two months in a row.
To economists, this has become a state of emergency. Former Federal Reserve Bank chairman Alan Blinder pointed out in the Wall Street Journal that the fraction of the employed population, 58.2 percent, is now lower than when the recession officially ended in June of 2009, when it was 59.4 percent.
With the highest tax rates in the Bush years far lower than in the Clinton years when the economy was soaring, there is no evidence that raising taxes on the wealthiest Americans would prevent job creation as House Speaker John Boehner, R-Ohio, keeps insisting. “What some people are suggesting is that we take this money from people who would invest in our economy and create jobs and give it to the government. The fact is you can’t tax the very people that we expect to invest in the economy and create jobs.”
Both the Bureau of Labor Statistics and the Tax Policy Center show that for the past 60 years, whenever tax rates were the highest, more jobs were created than when the tax rates were the lowest, as they are now.
Also, the wealthy and big corporations have billions of dollars in cash but are not using it to make more jobs. Yet Boehner argues that if they get more money, they will create jobs.
This country spent $14 trillion it didn’t have, mainly on two unfounded wars and tax cuts for the wealthy, and yet some Republicans say we should not honor those debts by raising the debt ceiling to pay bills we already have incurred. Income inequality is the worst it has been in 90 years, and yet congressional Republicans see nothing wrong with the rich getting richer while the poor get poorer.
When the economy is struggling as it is now, it makes no sense to put hundreds of thousands more people into joblessness by having state, local and federal governments drastically reduce public jobs. When the economy is struggling, it makes no sense to threaten to cut Social Security benefits, which did not cause the deficit. When the economy is struggling, it makes no sense to keep giving the richest people lower taxes.
At this point in a dramatically depressing soap opera in Washington, with America’s credit worthiness steadily decreasing, it is incredible that we still haven’t solved our economic crisis. It’s amazing that 16 percent of the public still has any respect at all for the wrangling politicians.
Our history is replete with bad decisions by our government — creating agricultural policies that contributed to the Great Dust Bowl, our treatment of Native Americans, our treatment of the Japanese Americans during World War II, the decisions that let the Great Depression develop, starting wars that we could not win.
It is now looking as if we could have another economic cataclysm because too many politicians are playing chicken with the debt ceiling and trying to get into position for the 2012 elections.
What this country desperately needs is not lower taxes or more rich people or another president or more tea parties. It needs stability so that businesses will have the confidence to expand and hire more people and bring jobs home from overseas.
At this point it is hard to figure out anybody else to blame but those Republicans who have decided, apparently, that it doesn’t matter who gets hurt as long as they get rid of President Barack Obama.
It is childish, and it is dangerous, and a lot of innocent people are going to suffer.
— Scripps Howard News Service