The Search to Cure Bad Economy

[WalkerARCHITECTS]

Finding A Cure

The idea that one medicine cures everything has been popular among the ignorant for a long time. In the old days, if a "doctor" thought that your skin looked too red, the standard prescription was . . . leeches. Fever? Leeches. Rash? Leeches. Bruise? Leeches. In fact, if you seemed to have an unfortunate tendency to get angry, the treatment for that was – leeches, you know blood sucking parasites!

Science requires research and study, solutions require knowledge based design intelligence. Where politics is concerned both are missing.

Architects are frustrated with the lack of solutions offered by the Congress to correct the economy. Across the country, thousands of people have registered their anger at a political and financial system that rewards the richest 1 percent at the expense of everyone else, by joining the 99 Percent Movement. Last week, the Congressional Budget Office added fuel to the fire, releasing a major report showing that average household income for the top 1 percent has nearly tripled since 1979 while income growth for other groups was largely non-existent. Apparently there is some reason to believe that this distribution of wealth is healthy. Architects that I know, unanimously disagree.

This was not some passing fad. This idea of curing people with leeches went on for quite a long time, in the range of 2,700 years, throughout Asia and Europe, and then the New World. Yet sickness remained, plagues came and faded away. leeches did not cure anyone but the people remained faithful to their false promise of health.

Being bled of opportunity and wages does not cure any of America’s problems. And it’s not just protesters who are concerned, as a new poll shows two-thirds of voters think the middle class is shrinking and 55 percent believe income inequality is a big problem for the country. The cure is not lower wages or lower taxes for the wealthy. Architects still need jobs and can't find them anywhere.

In response to the increasing attention on income inequality, many Republicans are trying to show they are committed to addressing the problem. It is not likely they will. House Majority Leader Eric Cantor (R-VA) recently planned a major speech on the subject, but abruptly canceled when he learned the speech would be open to the public. As "Politico" noted at that time, income inequality is “working its way into the discourse of Republicans on Capitol Hill,” even though their policy response has been to push the same old tax cuts they always suggest.

For the same old reasons we will hear one of the most pernicious falsehoods during the next seven months of political campaigning. This is an assertion that there is a necessary tradeoff between fairness and economic growth. By this view, if we raise taxes on the wealthy the economy can’t grow as fast. This is a fascinating fiction.

It is a lie. Taxes were far higher on top incomes in the three decades after World War II than they’ve been since. And the distribution of income was far more equal. Yet the American economy grew faster in those years than it’s grown since tax rates on the top were slashed in 1981.

This wasn’t a post-war aberration. Bill Clinton raised taxes on the wealthy in the 1990s, and the economy produced faster job growth and higher wages than it did after George W. Bush slashed taxes on the rich in his first term.

We wonder where these dysfunctional ideas come from. The leeches actually were grown on leech farms. Doctors were trained in their use. Doctors bought the leeches in lots, and kept them in an earthenware jar with little breathing holes in it. Whenever a patient "needed" one, the doctor would apply it to the patient. And then the leech would suck the patient's blood out. This was not curing anybody but the doctors were still paid for it. So were the leech farms.

During an interview last week on Capitol Hill, Peter DeFazio (D-OR) cast doubt on the seriousness of Republican efforts to fight inequality. There does not appear to be any serious effort to do anything about it. DeFazio blasted the GOP for signing onto the Americans for Tax Reform (ATR) “Taxpayer Protection Pledge,” as all but six House Republicans have done, effectively binding them to the opinions of ATR leader and extreme anti-tax zealot Grover Norquist:

DEFAZIO SAID: “They’re saying, you know, unleashing the job creators, protecting their tax loopholes, you know, and their tax breaks, protecting the Bush tax cuts will somehow solve income inequality.”

“ Well, we’ve got ten years of experience now of tax cuts that don’t create jobs and they have exacerbated the income inequality of this country. So, they are chained, they are chained to Grover Norquist and they can’t do anything that he doesn’t like so they can’t deal meaningfully with it.”

“They can pretend, they can change their rhetoric, they’re very good at that. They’re just really in a position with Grover Norquist over there and Wall Street over there. Where are they gonna go?”

Taking the life blood of the middle class away and giving it to the wealthy has not reversed the problems of the American people. This is a cure, just like leeches, that simply won’t work.

If you need more evidence, consider modern Germany, where taxes on the wealthy are much higher than they are here and the distribution of income is far more equal. But Germany’s average annual growth has been faster than that in the United States.

You see, higher taxes on the wealthy can finance more investments in infrastructure, education, and health care – which are vital to a productive workforce and to the economic prospects of the middle class.

Higher taxes on the wealthy also allow for lower taxes on the middle – potentially restoring enough middle-class purchasing power to keep the economy growing. As we’ve seen in recent years, when disposable income is concentrated at the top, the middle class doesn’t have enough money to boost the economy.

Leeches are the ultimate Yuk. For most of us, but some members of congress are now contenders.


So, basically, whatever was wrong with you, the doctor would attach a blood-sucking parasite to you, and that was supposed to make it better. That actually sounds very much like the right-wing's economic policies. Whatever might be wrong with the economy, let's just drain all the blood out of it, and see if that helps.


Unemployment? Let's cut teacher jobs. Deficit? Let's cut police and firefighter jobs. Trade imbalance? Let's cut sanitation and public transport jobs. Banking crisis? Let's cut nursing jobs. Cutting jobs produces only more desperation and foreclosure, not economic vitality.


Less is always going to be less. False beliefs that cutting will produce more than investing in America is like going back to leeches in place of modern day medical care. Fewer and fewer of us can have the medical care we should have because it keeps getting more and more costly as wages continue to fall.

Finally, concentrated wealth can lead to speculative bubbles as the rich in the same limited class of assets – whether gold, dotcoms, or real estate. And when these bubbles pop the entire economy suffers.

What we should have learned over the last half century is that growth doesn’t trickle down from the top. IT NEVER HAS!! It percolates upward from working people who are adequately educated, healthy, sufficiently rewarded, and who feel they have a fair chance to make it in America.

Fairness isn’t incompatible with growth. It’s necessary for it

Last week, in the New York Times, Paul Krugman described right-wing economics in a similar way: "suicide by economic crisis." The “greedheads” who run Europe are exploiting the economic crisis in weaker countries like Greece and Spain to wipe out pensions, benefits, unions and public healthcare everywhere. They don't just want to tear the social safety net. They want to nuke it.”

It will happen here to if we fail to act.

By 2007, America was about as unequal as it had been on the eve of the Great Depression — and sure enough, just after hitting this milestone, we plunged into the worst slump since the Depression. So more leeches were applied. This probably wasn’t a coincidence, although economists are still working on trying to understand the linkages between inequality and vulnerability to economic crisis. . If workers overseas are cheaper why would we have factories here? As employment & wages fall buying fades away. It is simply obvious if you think about it. Workers without good jobs and making good money can’t keep buying, so companies can’t sustain sales and profits. In fill that gap with E-Z credit and the recipe for disaster comes to form.

The saddest thing about that is all of the pain that it inflicts on the vulnerable and the needy. But the next saddest thing is this:


It just doesn't work. Bleeding a patient with leeches doesn't make him healthy. Even if you bleed him dry.


And now the greed-heads are coming for us, with their Ryan Budget and their Medicare vouchers and their Social Security cuts and their Medicaid block grants and their student vouchers and their privatization. Now, they're coming for us.

Well, here is this Architects answer: “No.“

TLW