Republicans Don’t Fear the Underdog

What is wrong with the Republicans finally getting to implement the agenda they have been carping about ever since Ronald Reagan left office? In a word, everything.

Of course, even though they have not gotten everything they wanted since Reagan, the economic policy followed by Bush I, Clinton, Bush II, and Obama still adhered to the general themes laid out during the Reagan years. Minimal taxation for the wealthy and corporations, decreasing overall deductions for the middle class, expanded deductions for corporations with lowered tax rates for capital gains. There has been an ongoing outsourcing of government services at all levels of government along with a near total deregulation of banking. And last of all, a new common denominator for how government structures trade agreements and government projects, both are now designed to improve the profitability of corporations.

Republicans built their new tax plan on a foundation established during the Reagan era. His administration established that economic ideas require exactly zero thought about what the problems are in our economy that need to be addressed. Changing the tax code should solve those problems.

Our economic problems are multiple, but the most pressing problem is our debt. Not the nation’s debt. The debt of the people who live here. Are there any provisions to reduce private debt, especially the debt owed by the 99%? Nothing, in fact the plan exacerbates individual debt. Wage stagnation is an immense problem. For the 99%, their wages have stagnated, for the 95% their real wages have dropped when measured against inflation. There is a tool that in the past helped to keep wages to keep pace with inflation. It is called taxes on the wealthy and corporations. Employers would rather raise wages and pay a lower tax rate than pay lower wages and pay a higher tax rate. These two issues, personal debt, and wages, combine to keep our economy on a dual track where the wealthy and the corporations are gathering up all available money. They are not investing in expansion, because the demand is not there. Demand is not increasing enough to push up wages and add jobs. And, demand drives the economy. We increase demand by putting more money in the pockets of the 98%, the people who will by necessity spend it all.

Flipping the GOP tax plan on its head, restore full medical deductions for everyone and restore full interest deductions for everyone. Dramatically increase taxes on the wealthy. And end lower tax rates on capital gains. Introduce a job guarantee, free public college tuition, tax deductions for all post high school education in the private sector, a living wage for a minimum wage, increase SS retirement payments and eliminate family ceilings, and of course implement Medicare for all.

These things and more will fix our economy so that it can grow organically. Instead of thinking about the Federal debt, think about the debt of families across the nation. If their debt is lowered and their wages increase, if their opportunities for jobs and education are real, then we can have a resurgence of the Middle Class.