Let’s look at all of their arguments one at a time and you can check the facts with all reputable people from the Congressional Budget Office to the economics departments of major universities.
Lets look at the face of it. As a percent of GDP, the total money a country makes in a year, the countries doing best in Europe have the HIGHEST amount of debt like England and Germany and the countries with a lot of unemployment and serious problems have much much less. Spain, Greece, and Italy have a lot less debt as a percent of GDP than Germany, France and England, yet Germany France and England are not in crisis. So the debt is NOT the cause of the economic problems of these countries. The economic problems of these countries are actually directly connected to the bad effects of having a common currency on a continent where labor mobility cannot assuage changes in the regional value of the currency, thus putting Germany etc. in a position to rake in huge amounts through exporting products and ruining the export solution (the traditional way out of economic problems that cause unemployment) for European nations. But unemployment and the devastation of the Euro as a common currency for countries like Italy and Spain are ignored with a fake debt crisis painted as the real cause making countries already unable to get people to work even more unable to get people to work as they are forced to cut jobs to balance a budget that does not need any balancing in order to accommodate the Euro.
With regard to the USA, the so-called debt crisis no matter how you look at it, amounts to about a year’s worth of GDP owed over the next 30 years or so. The average person in Massachusetts earns about 60 thousand dollars a year. If I told the average person that the amount they owed for their car, house, college loans, credit cards would be set at 60 thousand dollars instead of the average 600 thousand dollars or so, they would be in financial heaven. Can you imagine your mortgage falling to about say 150 dollars a month (half the new debt payments).
This model is the amount owed by the USA and the boogie man debt crisis: one year’s income spread over thirty years.
Argument one: Europe and the USA have a big debt crisis.
A completely fake crisis intended to make our attention focused on cutting jobs, to make the actual crisis unemployment even worse, and to make the amount of taxes coming into Washington even lower. But hey, that is what the right wing wants because they aren’t interested in the unemployment of low income earners they are actually interested in cutting government and making sure rich people have even lower taxes and bigger bonuses; which of course they would be because that is how they make their profits. Unfortunately that behavior has negative consequences that go beyond the individuals out into the community, consequences which they are insulated from but will start to feel more and more every time they leave their gated communities as unemployment goes up. Jared Diamond, points to this insulation as one of the major collapses of civilizations throughout history.
Keep in mind that the political magicians are always trying to get you to not pay attention to what they are really doing: cutting government and getting the rich richer at the expense of the poor and working folks. Don’t be fooled by the rhetoric: follow the dollars.
It would take in this country with annual income of 18 trillion dollars one third of which is given to the rich 1 percent or some 6 trillion dollars a year to the top one percent, an 11 percent surtax on people earning over 1 million dollars a year to wipe out the national debt in twenty years without cutting one nickel on the federal budget, without making one millionaire less than a millionaire after the new tax, without making one millionaire pay a higher percent in taxes than the average person in the USA pays right now so where’s the problem?
There is NOT a financial problem. There IS a cultural problem.
We do not have any fewer dollars than we did before; they are just in the wrong place and not circulating.
Under cover of the debt crisis Medicare and Social Security are under attack even though 60% of all US discretionary spending is for military hardware, guns and drones etc. none of which is apparently on the chopping block really since some of the rich make their money from these outsourced contracts. Mark my words any cuts to the military are cutting soldiers, cutting soldiers benefits and lowering soldiers pay raises, not cutting defense contracts which go to companies owned by the super rich in the USA. Four Southern States in the USA get over 80% of all US defense contracts and none of those contracts give one penny to people who risk their lives for us as soldiers. Note that none of the people who LIVE in those states get the cash: the companies are located there. The owners live all over the world in many different fancy homes.
Lets look for a second at Social Security. The AARP did a careful study backed up by the Congressional Budget Office a non partisan, respected analyzer of financial effects of government actions. The CBO and AARP point out
- the Social Security Trust Fund is the largest pile of money in the USA that no private company can touch and getting their hands on this money is what the ‘crisis’ in Social Security is really about: it’s a fake to get us to agree to changes that would allow the friends of the rich to give more cash for the rich to invest in the USA casino capitalism game that has dominated the USA since the days of the robber barons.
- The CBO says there will be by 2036 an inability for the fund to pay 100% of benefits unless change is made: our problem will happen in other words in 25 years.The fund would still be able to pay 75% of benefits and without any changes the fund would be able in ten years after then to go back to paying 100% if we did nothing because the elderly population would fall back to normal after baby boomers die.
- The CBO and AARP and others all say that a change in FICA, the tax we all pay for social security of one half of one percent would solve the problem.OR 90% of the problem would be solved if rich people would pay FICA on money they earned over 106 thousand dollars!Right now rich people don’t have to give one penny toward social security for money earned over 106 thousand dollars even though they COLLECT social security even though they are billionaires and don’t need it.
- It is said that the rich pay taxes on their social security.This is true. In real life the richer folks pay a total of 3.1% in taxes of what Social Security is spending, practically nothing.
- There is no program in the USA so well funded for so long with so little needed to make sure it goes forever than social security.What we really ought to do is tax everyone the same for social security meaning get the rich to pay their share which means we could actually DOUBLE the amount of benefits forever.
There are similar stories about Medicare, Medicaid and so forth. Rich folks and their advocates want you to think that cutting back on government spending (in other words reducing what government costs) and reducing taxes on rich people is what would solve our problems. Myth logically, because then they would have more excess money to invest in projects that would help that money then circulate. Myth logically, because then the potential profits of big business investments would be so large that people would take risks with their investment dollars to get big payouts, which would drive innovation.
These myths are very deeply routed in American rhetoric and are hard to chip away at because they seem classic and rational at first. However, what case examples have shown is that after the initial competition of capitalism wealth tends to accumulate and at a critical level the market becomes monopolized. After this occurs, the way to maximize profits is to take on very low risk projects and spend excessive amounts of investment in mass marketing, sabotaging competition, and making very narrow incremental innovations instead of radical innovations.
This can be easily seen in the development of HIV medications, which were only developed as a result of government funded research through channels such as the NIH, then after the public paid for the scientific breakthroughs (which happened because fanatical biologists and chemists really like doing that sort of thing, not because they were trying to get lots of money – another myth); but after the scientific breakthroughs were paid for by the public, then the private companies bought up the product to mass produce the drugs, inflate the prices under patent protection, and spend their investment dollars on mass marketing and advertisements.
This behavior crosses many industries, and though it is logical because it makes the most amounts of profits for wealthy, the social outcome is that it gets rich people richer and makes poorer people suffer more.
Don’t get conned by the Scott Browns and the other PR guys that dilute the facts and sell stories about what would be nice.
We don’t have a debt crisis and never did.
Social Security has more money than any program in government and will have it for at least 25 more years even if nothing is done.
Health care needs to be made more efficient, not reduced.
And the rich need to pay their share somehow; it would be great if it could be accomplished without mandating it. There is no reason to make people feel as though they are being punished. But what we have learned from historical and economic evidence is that society functions better when money is not pooled in the pockets of the few but is being invested (or circulated) in the welfare of the many.