CRYING IN ONE’S BEER

Folks you know that things are going wrong when you see television, cable or related. This is not a usual recession. Back in 2008, we were on the cusp of almost total financial  collapse. How did that happen? Here are a few reasons of  many. The downward spiral started in the 70’s and escalated in the 80’s. Under Clinton, things were beginning to turn around, then we went down again.(MSNBC.com)

In 1970, the average pay of a worker compared with a CEO was 28 to 1. Today the range is between  350 to 550 times greater in income. (Business Week, 2006)

 Using Supply side economics, for every dollar invested 17 cents trickles down to average consumer/worker(The Week, 2006) When jobs leave this country, the  three that leave two return as minimum wage jobs. The third is highly technical and professional (Sessions & Wortman, 1999)

The top 1% own 43% of the personal financial wealth (www.mybudget360.com) The top 1% pay 35% percent of reported income. However, most get their money from capital gains (money from productive property.) Thus, they pay 22 cents on the dollars as capital gains is 15%.When you combined the two previous stats, you get the 22%. (www.taxfoundation.org/news/show/250 html.)

Big business has to pay one of the highest corporate taxes in the world. That is 35%. However, after the accountants  prepare to pay the tax, it comes out to 2.3%.( Time, 2011) When a dollar is invested at the top as in trickledown theory, it moves from one person or organization to another 4 times (multiplier effect.) If it is invested in the middle, the multiplier is 8 times. The greater the multiplier, the greater the growth ( Moody.com)

The Fed is sitting on 9 trillion in bad loans (my budget 360) We need to pay back our debt, but slowly. We have not arrived at a safe spot yet (as this is being written.) Job growth was 2.4 jobs last year. Only one million are in the USA. The others are in foreign countries.  (MSNBC.COM) 409 K is not a good pension plan. Nearly half go to fees.(CNBC.COM) Standard pensions were replaced with 409’s because it was cheaper. Unlike a pension, the 409 is highly volatile. It also boosted the stock market.

By turning to supply side economics and related policies, this 30 year old strategy appears to  have greatly weakened the USA.

REFERENCES CITED

Sessions, R. & J. Wortman (1999) WORKING IN AMERICA New York: Notre Dame Press.

Steir  (2011) “Tax break for jobs”  Time, 2/7/56

_____BUSINESS WEEK(2006) 10/30/13.

_____CNBC.COM

_____Moody.com

_____Mybudget360.com

_____MSNBC.COM

_____Mybudget360

_____”Supply Side Economics  Revealed “THE WEEK (2006) 5/26/18

_____ Tax Foundation.org/news/show/250 html