WARNING: This contents of this blog post should cause a few blood vessels to pop out on your forehead in extreme anger at the way the 1% keeps stealing from the rest of us. If it doesn’t have you ready to snap, you’re either part of the problem or you need to go easy on the recreational pharmaceuticals!
Seriously, there’s a misconception perpetuated by conservatives that lowering taxes on the rich are essential to economic growth and creating more jobs for the middle and lower classes. It’s a case of the crooks telling us they aren’t stealing while at the same time they’re robbing us blind! Sour grapes? You’re damned straight! Do you enjoy being ripped off? I sure don’t and you shouldn’t either!
This is something that goes beyond traditional political boundaries. Blue collar or white collar, military or civilian, stay-at-home parent, single parent, unemployed or anything else that doesn’t put you in the top 1%, you should be totally upset by the gross deception being pulled by the 1% in collaboration with fringe groups. Trying to avoid getting mired in conspiracy theories, the simplest explanation seems to be the most rational — they’re simply greedy! And I mean very greedy!
This is not just some passionate diatribe! No, I have researched this and found numerous articles that have led me to this state of agitation. Now, I know many of you may believe the “conventional” wisdom espoused predominantly by Republicans that cutting taxes on the wealthy and corporations provides money for them to invest in new businesses and expanding existing businesses which in turn generates more good paying jobs. And as these workers have more to spend, they will spend more which creates more demand and leads to more jobs, etc. It’s an appealing argument EXCEPT that it’s purposely skewed to make the wrong people look good.
In actual fact, that’s not really how it works. According to an online article (read it here) on Business Insider from 2013 by it’s CEO and editor-in-chief, entrepreneur Henry Blodget, jobs are created by a “a healthy economic ecosystem — one in which most participants (especially the middle class) have plenty of money to spend.”
The same article cites Nick Hanauer, a wealthy investor and entrepreneur who founded online advertising company aQuantive, which Microsoft bought for $6.4 billion,as saying that creating jobs starts “with the company’s customers.”
Hanauer continues by stating that, “entrepreneurs are an important part of the company-creation process. And so are investors, who risk capital in the hope of earning returns. But, ultimately, whether a new company continues growing and creates self-sustaining jobs is a function of the company’s customers’ ability and willingness to pay for the company’s products, not the entrepreneur or the investor capital. Suggesting that ‘rich entrepreneurs and investors’ create the jobs, therefore is like suggesting that squirrels create evolution.”
Moreover, the article defines who those customers are. “The customers of most companies are ultimately America’s gigantic middle class — the hundreds of millions of Americans who currently take home a much smaller share of the national income than they did 30 years ago, before tax policy aimed at helping rich people get richer created an extreme of income and wealth inequality not seen since the 1920s.”
The article goes on to explain that the middle class has been hurt by tax policies geared to helping the 1% (and making everyone else pay for them), as well as globalization and technological advancements. Essentially, if the money that the 1% got in tax cuts was distributed to workers in the form of wage/salary increases, it would generate far more jobs than it would in the hands of the wealthy.
Okay, so that’s just one article, right? Au contraire. Let me share some insights from a 2014 article contributed by Steve Denning for Forbes.com. In it, he quoted researchers Jason Wiens and Chris Jackson of the Kauffman Foundation, who actually conducted research on investment and job creation, “… between 1988 and 2011, companies more than five years old destroyed more jobs than they created in all but eight of those years.”
Say what? Yes, jobs were created by new businesses. New startups create jobs and either flourish or drop out of the market quickly which frees up capital for more new ventures. So yes, investment has its place, but not exactly what we’ve been told. And there’s more enlightenment from Wiens and Jackson in the article.
“New businesses account for nearly all net new job creation and almost 20 percent of gross job creation, whereas small businesses do not have a significant impact on job growth when age is accounted for. Policymakers often think of small business as the employment engine of the economy. But when it comes to job-creating power, it is not the size of the business that matters as much as it is the age. New and young companies are the primary source of job creation in the American economy. Not only that, but these firms also contribute to economic dynamism by injecting competition into markets and spurring innovation.”
And that’s only exposes part of the subterfuge. You see, it turns out that publicly-held companies tend to either sit on excess funds or use them to buy back shares of stock to increase shareholder wealth.
The article quotes William Lazonick in HBR and the New York Times. “From 2004 to 2013, 454 companies in the S&P 500 Index expended 51 percent of their profits, or $3.4 trillion, on repurchases, on top of 35 percent of profits on dividends… More than three-quarters of compensation for the 500 highest-paid executives came from stock options and stock awards.
“So who gains from open-market repurchases? Their sole purpose is to give a company’s stock price a manipulative boost, and prime beneficiaries are the corporate executives who decide to do them… For corporate executives, stock-based pay is a ticket to membership in the 0.1 percent top-income club.”
Upset now? You should be! Now, don’t get me wrong. I believe that hard work and innovation deserve success and the rewards that come with it. However, those who reap the most rewards under our system should contribute the most in taxes and charitable donations to supporting the country that makes their gains possible. It’s not that alien of a concept!
Yet, billionaires and corporations spend millions of dollars to buy elections so they own politicians who will vote as they’re told. That means they’ll vote for policies that put more money in their owners’ pockets through tax cuts at the expense of the middle and lower classes. And that’s why they’re against universal health insurance, contributing to Social Security and Medicare, Medicaid, and all other forms of social programs. It’s also why they’re against unions and consumer financial protection laws.
Time to let the 1% know that the 99% isn’t going to take it anymore!!!
Get active in the political process!!! Contribute to campaigns of local politicians you trust so they rely less on big donors who do not have your interests at heart!!!
TAKE ACTION!!! SPREAD THE WORD!!! KNOWLEDGE IS POWER!!!
Let the R.A.I.N. wash away the lies and expose the truth!
The Divine Miss Briby