For some Libertarians and Republicans who sincerely believe that Supply-Side Economics, also known as Reaganomics, Trickle-Down Economics, Milton Friedman Economics, or Chicago School of Economics, is the be-all and end-all of economic philosophy. But they can find no actual, demonstrable evidence to prove their case.
There has never been a long-term successful society based on the system of Supply-Side Economics or on the Libretarian model. Everywhere it has been tried it has failed miserably. Why doesn’t it work? It seems like a fairly reasonable concept at first glance. The problem is that it falls down at every turn because it is based on false premises and assumptions and delusional concepts.
Let’s take this philosophy apart and see where it takes us. The basic premise of Supply-Side Economics is that prosperity is driven by supply. In other words, when things are being produced, there are jobs, income and prosperity. So if we give the tax breaks and money to the people and corporations at the very top, they will create jobs and the money will eventually "trickle-down" to the masses. So just give the money to the rich and we will all do well. George H.W. Bush, when he was running against Gov. Ronald Reagan for the Republican nomination for President, called the Supply Side Economics plan which Reagan touted - "Voodoo Economics".
The first problem I see with this is that the idea that economics are supply driven is ludicrous on the very face of it. Any successful business owner will tell you that being given a tax cut or credit does not give them any reason to hire people. Business people aren’t stupid, they hire people when there is a demand for the products or services they provide. If there is no one out there who is interested in or financially capable of purchasing what they are selling, then hiring employees is simply throwing money out the window. But when you give money to working people in the form of increased wages or tax cuts or any other form of income what will they do with it? They will spend it. This creates demand. When there is demand for a good or a service businesses will increase their production or new businesses will spring up to fill that demand because there will be profit in it for them. These businesses will then hire more people to meet the demand and those people will spend their wages creating more demand and so on and so on.
What do these rich folks do with the extra money if there is NO increase in demand for their wares? They invest it where they can earn dividends, stash it in off-shore accounts to avoid paying taxes on the interest. They buy homes overseas and otherwise give themselves more pleasures and luxuries. These folks are in the business of acquiring and accumulating wealth and for many of them this is an addiction much like gambling or hoarding. They could really care less about the rest of us and what our lives are like. Certainly there are exceptions but in the vast majority of cases this holds true. These people and companies didn’t get rich by sharing their wealth or by giving away their money. They hog it for themselves with no concern for anyone else.
So how do they sell this crap to us? First they created (via President Ronald Reagan) the meeme that government is the enemy. Reagan said "The 9 most terrifying words in the English language are... 'I’m from the government and I’m here to help.' " Thus was created the illusion that our government was inept, ineffective, and totally and irreversibly corrupt. They persuaded us that anything government does can only be to the detriment of the people because the government is so inept. This was a smoke screen, a snow job that allowed Republicans to fool people into voting against their own best interests. Democrats have always been much better at actually governing efficiently and effectively and, so to circumvent this advantage of the Democrats, the Republicans used them as their scape goat as a way to gain and retain power for themselves. The Republicans carry out the agenda of the multi-national corporate monopolies and the mega, ultra-rich who, in turn, richly reward these politicians by funding their campaigns and giving them posh jobs after their days of "public" service are done.
So what are the actual results of embracing trickle-down economics?
Let’s see what they would do if they were in power and how this would change our lives.
First order of business would be to give huge tax breaks to the ultra rich and tax breaks, "incentives" and tax loop holes to the huge corporate monopolies, many of which are not even based in this country anymore.
Second: They would eliminate the minimum wage and maybe even introduce a maximum wage cap. Keeping labor costs dirt cheap is one of their primary objectives.
Third: They would abolish labor unions, leaving workers with no power to challenge wrongful and unjust or unsafe practices by giant corporations. All fair labor practices would be abandoned. Workers would be totally under the thumb of their employers who could fire them at will, cut their pay and/or hours or require them to work 16 hours a day under all manor of unreasonable and unsafe conditions. Legal recourse for workers would be nearly eliminated.
Fourth: They would eliminate pensions and health care benefits paid by employers, leaving working people to fend for themselves in these areas.
Fifth: They would privatize medicare, social security, education and almost every other function of government. This would result in people’s health and retirement costs being completely subject to the whim of the markets and subject to the additional expenses of providing profits to the private companies running them. These profits would take away from the funds available to actually provide these services. This would also put education, even basic education, beyond the financial reach of the average working family. Putting such programs at the mercy of the markets would be a disaster as proven by the recent crashes in the stock markets causing so many to lose their life savings, pensions and net worth.
Sixth: The taxes on the middle class (whatever would be left of the middle class by this point in time) and the poor would be increased to bear the burdens of maintaining whatever infrastructure would be required for the rich and the corporations to maintain and increase their wealth and power.
Seventh: All restrictions and regulations on corporations would be eliminated, leaving us at the mercy of companies who pollute, who treat their workers no better than slaves, who refuse to provide safe work environments and safe and sanitary products to the market place and who basically have no concern for doing anything ethical or moral in fear that it might take away from their profits.
Now, what kind of life would most Americans have under the total Republican agenda?
With things changing so rapidly and varying so much from region to region in the country these figures are pure estimates. You can figure out what they would be in your area and plug those values in here. Let’s say you have a wife and 2 kids. I base these figures loosely on what it costs you to live your life and what might be your income under such a system of Supply Side Economics. You would probably only work 38 hour week which would reduce the labor costs for corporations, thus giving them more money to put in their pockets.
Your pay might be around $7/hr if you were lucky, bringing home an approximate net income of $213 per week, or $852 per month. If your wife worked full-time and brought in a net amount of $700 per month (women could not be allowed to earn as much as men) for a combined net total of $1552/month. Let’s see what this will get you:
1) Rent or mortgage - small 2 bedroom /one bathroom - probably $700 for a modest place.
2) Utilities: (water/sewer/trash pick up, electricity, gas, etc) around $275 a month.
3) Groceries: for a family of 4 - about $500/month eating very frugally
4) Transportation: You couldn't afford a car - only a bicycle. You might take the bus or train to work, the doctor or grocery store - $150/month
5) Insurance: out of the question - you can’t afford any kind of insurance
6) Medical expenses: (including dental, primary care and vision plus medications) - $250 minimum
7) Clothes: $200/month - for very modest clothing for the 4 of you
8) School expenses for the kids - supplies, field trips, pictures, extra curricular activities: $150/month
Keep in mind that these would be the minimal costs to live for a family of four.
So let’s total things up. Keep in mind this gives you no cable TV, no vacations, no health care coverage, no sick days or time off to take care of sick kids, no frills at all.
1) Housing - $700
2) Utilities - $275
3) Groceries - $500
4) Transportation - $150
5) Insurance - $ 0
6) Medical - $250
7) Clothes - $200
8) School Expenses - $150
Total Expenses - $2225
Total Monthly Income: $1,552
Total Monthly Expenses: -$2225
Shortage Each Month: -$673
So you are barely living at a subsistence level and still coming up $673 a month short. It is easy to see how one single catastrophe, an accident, a medical emergency, a leaky roof, a blown transmission, a lost job, etc. could send a hard working family to living in the streets in a flash.
You would never have enough to live on. And with no minimum wage law how long do you think it will take corporations to push wages down to the level of a third world country. Would you like to work for $50 a week or $50 a month?
This betrays the conservative agenda beneath the one that they present to us in their corporately controlled and right wing biased media. They want the cheapest possible work force. They don’t want to pay for any kind of a social safety net for us. They consider us completely expendable and easily replaceable (keep those babies coming) and they haven’t got the least bit of empathy, understanding or compassion for the difficult and many times impossible living conditions this scenario would create for the vast majority of us working our butts off and trying so hard to make a decent life for ourselves. They bitch and moan about paying us too much and then when we can't afford the basics of life they scream and hollar about our being freeloaders and sucking at the government teat. They want their cake and eat it too.
Is this the kind of America you want? A nation of wage slaves - a vast impoverished population who never have enough of anything to be safe, secure or comfortable much less happy? Do we want to be a nation always fearful of getting sick, being in an accident, or losing our already low-paying job to someone who will work for even less? Do we want to be a country of people with no hope of things ever improving? Is this what our soldiers over the centuries have died for? Is this what our founding fathers had in mind for us? Is this what our parents and grandparent toiled so hard for? Hell no! They wanted a good a prosperous life to pass on to us, attainable by diligent work and by doing our very best to make the finest products we can, after all, it is our neighbors, friends and family who will be buying and using them. And of course we want them to have the best possible quality of goods, foods and services as we would for ourselves. We would want them and ourselves to have a safe and reliable food and water supply, safe and reliable products, and the best possible health care that we can have for our entire lives, right?! If we aren’t answering "yes" to these questions we might want to check and see what country we are really looking for, because this is no America I ever heard of.
What happens to the American Dream under such a system? It works fine for the ultra-mega wealthy. They are doing just fine. They have no worries, no problems that they can’t buy their way out of; no laws they can’t bribe their way around. They leave us with no recourse when they abuse us by making us work in horrible working conditions for long hours with no extra pay, for cat-food wages and with no voice in what happens to us and no power to change things for the better.
Is this beginning to sound like feudalism from the middle ages? That’s exactly what it is and what the wealthy ruling class are trying to recreate. That is precisely the system that assures them of their continued wealth and power. They keep the "rabble" under tight control by keeping us ignorant, powerless, poor, sick and always struggling so hard to survive that we have no time to think about the bigger picture and what we might be able to do to improve our lot in life.
These people want us to work for dirt cheap wages, find our own way to get medical care for us and our loved ones if we can, accept whatever wages, working conditions and demands they may make on us without complaint and be grateful that they are even condescending to give us a job at all.
And in the meantime these fat cats are raking in record profits in the hundreds of billions and trillions with huge bonuses going to CEOs and fat dividents to their wealthy investors. They could easily afford to bite the bullet a little in order to make life reasonably comfortable for the rest of us. It’s no skin off their noses if they start to pay their fair share of taxes as we have always had to do and share their great fortune with those of us upon whose backs their wealth is built. They have now created a permanent royalistic, generational rich, ruling class that cannot be challenged and are immune to the hardships the rest of us live with every day.
This is not the kind of American dream that any of us ever dreamt of. No one in his right mind would think this was a good life. But there it is, the Republican plan for us. How do you like it?
How long would it take for life in America to degenerate to the point of being a feudalistic system, with the very few very rich and powerful controlling everything to their complete advantage with not a single thought of how it affects any of the rest of us? In the meantime the rich and powerful would live in their plush mansions in their guarded, gated communities or estates with gold plumbing in the bathrooms, yacht docks in the back and a helicopter landing pad on the roof. They would have luxurious estates such as this in as many countries as they wanted and have a fleet of Rolls Royces, Lamborginis and Bentleys at each one. Servants (probably your wife, kids, sister, brother or parents) would attend to their every desire and they would feast on the finest of cuisine while you’d be lucky, very lucky to eat Ramon noodles and day old bread.
And yet they have convinced us that we could one day be among their ranks because that is the "American Dream" - more like the American fairy tale. How many people that you know have made it to the ranks of millionaires, much less billionaires? It is a myth they create to get us to support their plan and vote directly against our own best interests. If you think like you might one day be a millionaire then, of course, you wouldn’t want the "government" stealing your money from you, would you. So we'd better make sure that the rich get to keep it all so that when we join them we’ll get to keep ours too. HA! What fools we are if we believe that. That is exactly what they want us to think, exactly how they have manipulated the information they give us via their corporately controlled, biased media to dupe us into thinking we’re one of them. YOU’RE NOT ONE OF THEM AND YOU NEVER WILL BE! How the hell much money does a person need to live a good life and be happy? And where do you draw the line between having enough and just plain GREED??? I don’t think it takes a genius to see that a happy and prosperous life can be had with much, much less money than these fat cats hold in their sweaty little hands.
Well, that’s the picture. Not a pretty one, eh? So, it’s time to take responsibility for ourselves, to make the effort to find out what’s really been going on in our country, who’s really in control and pulling the strings, how they are manipulating us into doing their bidding and what you can do to change it.
It is our absolute DUTY as American citizens to become informed of the truth, of reality, of the issues and candidates and what they stand for and what results they are actually creating in our lives. Get busy, you’re way behind in your homework, folks. If you don’t like what you’ve got then you have no one to blame but yourself. Let go of your anger, your hatred and you frustration, get up and start working to change things for the better. Don't take these crooks at their word. Don't believe things just because you heard them on the "news". Check out their sources, find the real facts. Elect people who are truly on our side and unwilling to bend to the power and the wealth of the mega-rich. We need people with enough integrity to withstand the onslaught of money, intimidation and downright threats these "gold collar criminal" use to get their way. Let’s get this ship of state turned around and heading, finally, in the right direction. If we all work together there is nothing in this world that can deny us what we seek.