"Look, I'm glad Blue Dogs don't just want to cut taxes for the wealthy with more deficit financing, but their priorities don't make any sense," Steve Benen wrote this weekend. "They want to cut spending (which improves the economy) in order to pay for breaks for the wealth (which doesn't improve the economy)." We may be out of the recession, but we aren't out of the woods. Demand is still low, which is driving the unemployment crisis. Cutting government spending means reducing demand further, while extending the tax giveaway doesn't really do anything. If it did, the Bush economy wouldn't have been so stagnant until it finally crashed. If there's one thing that should've become obvious by now, it's that supply-side economics is basically a superstition -- we've watched it fail for about a decade, if not longer. Extending Bush's tax cuts to the richest Americans won't do a damned thing for the economy. At least, not anything positive.
Still, we've got those who FDR called "economic royalists" working to help the wealthiest at everyone else's expense. For them, economics works like this: the very wealthiest people are the most important people ever and the rest of the world is just a support system that makes their lives possible. The end.
Franklin Delano Roosevelt, Speech before the 1936 Democratic National Convention:
The hours men and women worked, the wages they received, the conditions of their labor -- these had passed beyond the control of the people, and were imposed by this new industrial dictatorship. The savings of the average family, the capital of the small-businessmen, the investments set aside for old age -- other people's money -- these were tools which the new economic royalty used to dig itself in.
Those who tilled the soil no longer reaped the rewards which were their right. The small measure of their gains was decreed by men in distant cities.
Throughout the nation, opportunity was limited by monopoly. Individual initiative was crushed in the cogs of a great machine. The field open for free business was more and more restricted. Private enterprise, indeed, became too private. It became privileged enterprise, not free enterprise.
"The royalists of the economic order have conceded that political freedom was the business of the government, but they have maintained that economic slavery was nobody's business," he said. "They granted that the government could protect the citizen in his right to vote, but they denied that the government could do anything to protect the citizen in his right to work and his right to live."
And so it still is. Companies employ people for 35 hours a week, instead of 40, so they can claim they're part-time and deny them benefits. They cut workers' pay -- not because the company is struggling, but because they believe they can increase their profits -- while the millions made by the people making those decisions only increases. "There's class warfare, all right," billionaire Warren Buffet once said, "but it's my class, the rich class, that's making war, and we're winning."
And we recognize the unfairness, even if we don't know about it. A new study [pdf] finds that, given our choice, we'd rather live in a society where income distribution was closer to Sweden's. In fact, we tend to believe it already is. And this is because we're unaware of how unequal our present society is. And it's incredibly unequal.
Raw Story [emphasis mine]:
Recent analyses have shown that income inequality in the US has grown steadily for the past three decades and reached its highest level on record, exceeding even the large disparities seen in the 1920s, before the Great Depression. Norton and Ariely estimate that the one percent wealthiest Americans hold nearly 50 percent of the country's wealth, while the richest 20 percent hold 84 percent of the wealth.
But in their study, the authors found Americans generally underestimate the income disparity. When asked to estimate, respondents on average estimated that the top 20 percent have 59 percent of the wealth (as opposed to the real number, 84 percent). And when asked to choose how much the top 20 percent should have, on average respondents said 32 percent -- a number similar to the wealth distribution seen in Sweden.
"The authors suggest the reason that American voters have not made more of an issue of the growing income gap is that they may simply not be aware of it," we're told. It's a lot easier to be a drone in the royalists' hive when you don't know you're just a drone.
Still, we have some gut awareness of this fact. We must, because we know extending the tax giveaway to the wealthy is moving in the wrong direction. Gallup shows that 44% -- the largest group -- wants tax cuts extended for everyone but the wealthy. We know that this is fair, even if we're not entirely sure why.
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