There are many policies about which reasonable minds may differ. However, some policies are just dead-ass wrong. The Viet Nam war comes to mind, as does the invasion of Iraq. While we are still paying the price for those, nothing has affected quite so many quite so much as trickle-down economics.
For as long as this country has existed, we’ve struggled with one another over how much or how little we should regulate our economy. Some say we should use our tax dollars to level the playing field and create a safety net. Others say we should incentivize business with fewer regulation and lower taxes. The latter favors businesses and the wealthy on the theory that they will invest more into the economy, which will create a “rising tide lifts all boats” situation. Thus, the moniker “trickle-down.”
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The only trouble is that it’s never worked. The privileged do not reinvest in the economy, they hoard their profits. You might not notice it at first, but after a few decades, you’ve got some artifacts you wish you didn’t:
Cost of living is unaffordable for most laborers. They do not accrue savings for emergencies or wealth.
Homelessness increases due to the cost of housing and price gouging by corporately-owned rentals
Vast wealth inequality, leading to rogue billionaires meddling in foreign and domestic public policy and lower wage workers becoming increasingly desperate.
Societal polarization and civil unrest eventually follow.
Enlightened self-interest
Personally, my life is comfortable enough that I probably benefit from trickle-down’s tax cuts. If I oppose it anyway, it’s not because I am some benevolent, selfless being. In fact, I’m just about the most self-absorbed person I know. However, I do not exist in a vacuum. I have to live on this vast continent with 333 million other people and what happens with them affects me.
Until January 6, 2021, I was fortunate to live in relative peace and safety. Now I have to worry about getting doxxed if I’m too outspoken. Why the change?
No one should be surprised at this point. After forty years of no wealth-building, the working class is disproportionately under capitalized. Middle income-earners spend an average 39 percent of their income on rent. As trickle-down time goes by, corporations begin to consolidate and, in the laissez-faire economy, everything is eventually commercialized:
Health care
News
Education
Political favors
The price of rent is driven up and the housing supply is reduced by properties being bought up by private equity firms. That means, if you’re lucky enough to find a place, you can rest assured that you are paying top dollar for your rent and that your landlord does not give one whit about you. To the corporate landlord, all you are is a revenue stream. The reason homelessness exploded during the pandemic is simply because renters with little savings were furloughed from their jobs and could not keep up their rent. With no income and no savings, where exactly is one supposed to go? Some camped out with friends and relatives. Many moved into cars, RVs, or tents. The misery is compounded by peoples’ fear and hatred of homeless people, so what little a homeless person has is likely to get swept away when government agencies clear encampments. They clear encampments so that people like me will not be disturbed.
During the worst part of the pandemic, we went sofa shopping in Berkeley CA. Walking down one of the major arteries in the town, we were greeted by tents that were chock-a-block on the sidewalk. In one of the richest nations on earth. When we get to this point, our policies become obscene. Meanwhile, Jeff Bezos has a yacht so big it cannot pass under the historic Koningshaven bridge — and he sincerely felt entitled to demand that the bridge be dismantled!
I try not to use the phrase “income inequality” because I honestly have no problem with different people having different incomes. At the end of the day, I’m a capitalist who likes meritocracy. I’ve got no issue with rich people being rich or successful people being successful. My issue is with wealth inequity. That’s what happens when some people have a plethora of opportunities while others have none. Besides being unfair, such a scenario is downright dangerous.
Why I vote Democrat
Besides the fact that I don’t want some freak and his cronies taking the country hostage, I’ve got my reasons for voting Biden in 2020 and Harris in 2024. Joe Biden is the first president in forty years (since Ronald Reagan pushed us over the trickle-down waterfall) to begin reversing these short sighted and cynical policies. Kamala Harris will continue in that vein.
For as long as America has been the USA, people have been quacking about that bogeyman “socialism.” That one word is all they have to say to rile up the Republican base. It’s obvious, however, that persons invoking “socialism” do not know what the word means. They speak of socialism trusting that you don’t know what it means either. It’s as if the mere mention of safety nets and infrastructure conjures an image of all of us trudging around in Mao suits. I rarely argue with them because I wouldn’t know where to begin.
Part of this comes from the “pick yourself up by the bootstraps” ethos of American individualism. It engenders contempt for people who rely on social programs and benefits. Like most bigotry, this is all in ignorance. Not only do many people misunderstand the nature and extent of government programs, they also fail to understand how mass destitution endangers their own lives.
Widespread poverty can significantly endanger a community in several ways:
Economic Instability: Poverty limits access to education, skills training, and employment opportunities, which can lead to high unemployment rates and economic stagnation.
Health Issues: Poor communities often lack access to adequate healthcare, clean water, and nutritious food, leading to higher rates of illness and malnutrition.
Crime and Violence: Economic desperation can increase crime rates as individuals may turn to illegal activities to survive.
Social Fabric: Persistent poverty can erode social cohesion, leading to increased social tensions and reduced community trust.
Political Instability: High levels of poverty can undermine political stability, as disenfranchised populations may become more susceptible to radicalization and civil unrest.
Environmental Degradation: Poor communities might rely on unsustainable practices for survival, such as deforestation or overfishing, which can lead to long-term environmental damage.
Addressing poverty requires a multifaceted approach, including improving access to education, healthcare, and economic opportunities, as well as fostering social inclusion and environmental sustainability.
The honest truth is, America’s economy has flourished the most under Democratic administrations. It’s regular people who reinvest their resources into the economy — not the corporations or the wealthy — at a level of scale that truly does create a rising tide that lifts all boats. To see the consequence of extreme wealth inequality, one need only look to the French Revolution.
A psychoanalytic moment
If what I’m saying is correct, don’t you wonder why anyone would institute a trickle-down economy in the first place? One obvious reason is the long term consequences pale before the short-term gains. I think there’s a bit more to it than that.
In Psychology 101, we learn about defense mechanisms — tactics people instinctively deploy to stave off feelings of insecurity, shame, or threat. Carl Jung said that “everyone carries a shadow” — an aspect of ourselves that we reject, deploying defense mechanisms to deny that this unwanted part of ourselves exists. This inability or refusal to reckon with the shadow aspects of ourselves can often create more problems than they solve.
The defense mechanism I’m thinking of now is projection. This is when we see in others the disowned parts of ourselves. The disowned parts of human nature that contribute to the ills of trickle down economics include:
Greed and lust for power,
Self-centeredness,
Contempt for others who are different, foreign, or experiencing something we dread,
A tendency toward short-term planning.
Trickle-down economics presents itself as if it were benevolent and virtuous. “A rising tide lifts all boats,” they say. Or, something about rugged individualism and meritocracy that implies that needy people only got what they deserved. Rather than projecting greed, avarice, and shame onto others, if we accepted these unattractive parts of our human nature, we’d be in a better position to eradicate them or at least mitigate their effects. Purveyors of trickle-down economics are saying “I’ve got mine” and do not care about the others of us who struggle.
What to do?
My best suggestion is to begin by gaining enough influence to end trickle-down policies. We need enough power to bring a halt to economic policies that send tax dollars to large corporations and wealthy people, while others descend into destitution and despair, infrastructure crumbles, and the obscenely rich wreak havoc on foreign policy. (For an example of that, see Musk, Elon.)
Leveling the playing field, protecting people from destitution, and creating equitable opportunities for all does not mean you can’t get stinking freaking rich. Let’s look.
If you wanted a monthly budget of $250,000, how much wealth would you need?
For your wealth to last ten years, you’d need thirty million dollars.
To make it last for seventy years, you’d need $210 million.
To support a monthly budget of one million dollars for ten years, you would need $120 million.
To support a million dollar monthly budget for fifty years, you’d need a nest egg worth $600 million.
That’s pretty freaking rich.
So, what would be the effect of a 90% tax rate on these folks?
If you earned $250 million a year in income and capital gains, your after-tax revenue would be twenty-five million dollars.
If the tax rate were 50%, you’d be left with $125 million
If you had $1 billion that you wanted to spend down in a year, you would have to spend $83.33 million each month.
These are rough, back-of-a-co*cktail-napkin figures, but what do they tell us? Consider this:
Elon Musk’s net worth is $239 billion.
Jeff Bezos’s net worth is $191 billion.
Mark Zuckerberg’s net worth is $180 billion.
What do these guys have in common (besides being dweeby white men)? Their individual net worths are larger than the annual budgets of some entire countries. These billionaires have an average true tax rate of 3.4%. Even a sharp rise in their effective tax rates would barely register as a blip in their pocketbooks.
The world doesn’t have to be this cruel
When some individuals have enough money to sabotage foreign policy and consolidate entire industries, they become a national security problem. No one deserves to be that rich. Yes, I know I’m being judgy, but these guys have more money than they even know how to comprehend. Billions of dollars would have to be shaved off before they would notice it missing. How would Joe Biden’s economic plans effect these guys?
“The Build Back Better framework includes a new surtax on the income of multi-millionaires and billionaires – the top 0.02 percent of Americans. It would apply a 5 percent rate above income of $10 million, and an additional 3 percent above income of $25 million. The Build Back Better framework will also close the loopholes that allows some wealthy taxpayers to avoid paying the 3.8 Medicare tax on their earnings.”
Poverty does not make someone a leech. Wealth does not make someone evil. But in order to create the best conditions for the most people for the longest amount of time, we need to confront “the shadow” and create a hack for our human nature. You don’t have to be a saint to see that it’s in your own best interests.
Song of the Day
“Opportunities” — Pet Shop Boys
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Keep on keepin’ on,
Cindy
