Article first published as Why Don’t the Facts Seem to Matter Anymore? on Technorati.

How do Americans make up their minds on political issues? Some, I’m sure, simply echo the positions of trusted friends. There are people who are persuaded by specific arguments that just seem to personally resonate and still others who simply adhere to strict party lines. Such practices are understandable in the fast paced world of 21^st Century America. But understandable or not, one has to wonder if a more deliberate approach might be warranted.

Take for instance the current debate over the extension of the Bush tax cuts. Most polls previously showed that the majority of voters support extending the cuts for only the middle class. But the margins were remarkably thin and continue to shrink.

The most recent Gallup poll shows only 44% of participants in favor of extensions depending upon income level and tallied 40% in support of cuts regardless of income. An Associated Press poll of 1,000 people, taken just before Thanksgiving, showed a slightly larger margin, with 50% in favor of cuts for income up to $250,000 and only 34% favoring cuts for all income.

Division of this sort is typical on political issues, but what’s interesting about these results is that, while only 2% of Americans would benefit directly from cuts on income above $250,000, a third or more of those polled consistently support those very cuts. This is an atypical disparity that surely must have some explanation.

One possible motivation could be that people are concerned about jobs. According to that same AP poll, 82% of participants cited unemployment as an “extremely” or “very” important issue. Perhaps these people believe that extending tax cuts to the wealthy will result in job creation. After all, anyone who’s listened to the media has heard this argument. It’s a favorite of congressional Republicans, who regularly cast any tax increase as “job killing.”

But the fallacy of such a premise is immediately evident in even the briefest moment of serious contemplation. The fact is that employers simply don’t hire based on their personal income tax treatment. The formula for staffing is strictly limited to the number of employees required to produce the product or provide the services necessary to meet demand while maintaining a profit — period. Profits must be made before taxes even come into play. The fundamental rule is that, if demand goes up, businesses must hire more people, and if demand wanes, there will be layoffs.

I’m afraid that while the don’t-tax-the-job-creators line seems to have some legitimacy on the surface, nobody who’s actually studied the issue believes it. Economists are all forced to agree with Cornell University’s Robert Frank, who sums up the present situation with “Businesses aren’t investing because they can already produce more than people want to buy.” Indeed, the nonpartisan Congressional Budget Office (CBO) produced a report on the matter and concluded that, of the top 12 suggestions for spurring job creation, income tax cuts was the least effective option.

So, maybe jobs aren’t the primary concern. Could it be that people are moved to support tax cuts, even for millionaires and billionaires, out of a general concern over the economy? The economy was the highest priority issue amongst those voting in the AP poll. A full 90% of participants ranked it at one of the two highest levels of importance.

There has certainly been enough rhetoric flying around about the detrimental effects of raising taxes on anyone to give ample cause for alarm. Republicans are unified on the topic. The new Speaker of the House, John Boehner, voiced this conservative wisdom in an interview last August, “You cannot get the economy going again by raising taxes on those people who we expect to create jobs in America.” It sure sounds good, but once again there’s no evidence and only rare opinion to support the conclusion.

The fact of the matter is that the American economy is driven by consumer spending. To put that in perspective, around 70% of our GDP is generated thusly. So, it’s actually lack of demand that’s the key issue with the American economy today. Too many people are either without jobs and unable to spend or holding onto what money they have because they’re worried about the future. Businesses are flush with cash but aren’t investing for the same reason. They’re not refraining from hiring because they may have to pay more in taxes. They’re not hiring because there’s insufficient demand.

Tax cuts for the top 2% will stimulate the economy, but the sad truth is that pretty much any other practical option would be more effective. Numerous studies have been completed, and virtually all agree that general tax cuts are the least effective form of stimulus, and those applied to the very rich are the worst of the worst. The CBO study mentioned above again rates tax cuts at the bottom of the heap with regard to impact on the GDP, with a best case of returning $0.40 for every dollar invested. Compare that to $1.90 for increasing unemployment aid, and you might glimpse the insanity of the conservative argument.

Although concern over the deficit is also high on everyone’s list, it’s difficult to see how anyone can argue that extending tax cuts that would trim $700 billion from federal revenue could help the deficit. So, if it’s not jobs, and it’s not the economy, what is the explanation for as much as 38% of Americans supporting tax policy from which they will not personally benefit?

There is one other possibility. It could just be that good old American sense of fair play. When asked how they felt the spending cuts and tax increases needed to address the deficit should be applied, the majority (54%) of participants in the AP poll thought they should “Be spread out so that all Americans share evenly in the costs.” A truly admirable position to take.

But then, just what is it that constitutes an even share? It’s hard to believe that there’s any such equity in extending tax cuts that already provided 52.5% of the benefit to the top 5% of taxpayers. The stark truth is that you cannot achieve an “even share” by extending that which is, by design, extremely uneven.

The facts about the Bush tax cuts are dramatic. They were touted to create jobs and stimulate the economy, yet they did neither. With regard to the economy, the Bush era netted the slowest average annual growth since World War II, averaging only 2.39% per year. And that doesn’t even take into account the economic crash of 2008. The next worst period was 1971 to 1980 at 3.21%. On the job front, the results were even worse, with the Bush era producing the slowest rate of average job growth of any cycle since 1945.

In the final analysis, the Bush tax cuts served but one purpose — to accelerate the concentration of wealth in America. Things have now become so lopsided that the top 1% of Americans now have more financial wealth than the bottom 95%. When the portion of wealth held in home equity is discounted, the top 1% holds 48.4 percent of the wealth compared to 20 percent retained by the bottom 95% — and that gap is growing at an alarming rate.

By 2001, the share of financial wealth had already grown to a 39.7% – 32.5% split, but ramped sharply upward under the policies of George W. Bush. The fact is that the wealth of the very rich is being extracted by squeezing the overwhelming majority of Americans to the point of collapse. The situation is so bad today that 23.5% of overall income belongs to that top 1%.

According to Bloomberg, during the period that followed the first of the Bush cuts, up until the financial meltdown, the average annual income of the top 1% grew from $1.08 million to $1.87 million, an increase of 73%. Meanwhile, according to the U.S. Census Bureau, the Bush economic cycle was the first since tracking of the data began in 1967 to produce a decline in median household income — focusing specifically on working-age household data, real incomes dropped by a whopping $2,176.

This is a sad and unethical story, and it’s not representative of the America that most Americans have grown up to love and respect. Our nation was founded on the principles of equality, of shared prosperity and shared burden — principles to which the policies of deregulation and tax cuts for the rich that have dominated the political landscape for the past 30 years are diametrically opposed.

There’s no guesswork here; we already know the outcome of the Bush policies. If the tax cuts are allowed to be extended intact, we will maintain the present trajectory. Poverty will continue to climb; the rich will get much richer, and any balance achieved will be on the backs of the middle class. Make no mistake about it; this is unfair, unethical, immoral, and completely un-American.

Welcome to the real-life tragedy of the commons in America, where the very wealthy have chosen to bleed the country dry, because regardless of the eventual outcome — they will already have their riches. It’s a game of squeeze-all-that-you-can while the squeezing is still possible; it is in essence the great national Ponzi scheme.

America’s economic elite have no interest in reforming the system to achieve sustainability. Our nation, its people and natural resources are nothing more than fodder for the mill of exploitation. And as with any Ponzi scheme, the sustainment of the system matters only to those who have not yet reaped their reward from the extraction.

The American people are the proverbial frogs in the kettle: they continue to support their own demise because they fail to recognize that the heat is still being turned up. If the American middle class is going survive, we will need a 21^st Century awakening. And that awakening must begin with people rejecting the self-serving sound bites of those with their hands on the thermostat.

In the end, the inescapable truth is that, whether the American people choose to recognize the facts or not — the facts do matter. We are presently in a race to the bottom for the vast majority of Americans — and that’s a fact. We can continue this march into oblivion or we can stop the hemorrhaging and restore some semblance of shared prosperity — and that too is a fact. The choice lies with the American people, and the future of our nation depends upon which way they choose — and that’s the most important fact of all.

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Article first published as GOP vs. Dems; No Compromise Equals No Solutions on Technorati.

Politics can be very complicated, or at the very least confusing. Case in point: what is it about the Republican pronouncement of “NO COMPROMISE” that President Obama and the congressional Democrats don’t understand?

Did they miss it when John Boehner, the presumptive Speaker of the new Republican controlled House, announced that, “This is not a time for compromise?”  Perhaps they misunderstood high-ranking Republican House member, Mike Pense of Indiana, when he said, “Look, the time to go along and get along is over,” even though he reemphasized, stating, “If I haven’t been clear enough yet, let me say again: No compromise.”

Is it possible that the President took Senate Minority Leader Mitch McConnell’s statement that, “The single most important thing we want to achieve is for President Obama to be a one-term president” as some sort of conservative jest?

It’s hard to tell what the President hears when congressional Republicans throw down the gauntlet and demand that he move in their direction. But, in response to the wave of emboldened Republicans taking intransigent positions against any sort of compromise, President Obama told the nation, “I believe there’s room for us to compromise and get it done together.”

The saying goes, “Fool me once, shame on you; fool me twice, shame on me.” Fool me over and over again, and maybe the people who believe I’m actually being fooled are the ones being hoodwinked. Is President Obama really so foolish as to believe that the Republicans will engage in open, good-faith negotiations, or is he merely a performer in a stage show written and produced to convince the American people that somebody in Washington wants the status quo to change?

When the President spoke in Cleveland in September, he came out swinging. He artfully painted the Republicans as the champions of the very wealthy and articulated a plan for the extension of the Bush tax cuts that drew a line in the sand, defining $250,000 of taxable income as the divide between the middle-class and upper-crust. It was the perfect issue for the closing weeks of campaign 2010, but cowardly Democrats backed away in fear that the Republicans would paint them as tax-and-spend liberals.

Well, not only did the Democratic retreat fail to impress any independents, but it also ensured that there would be no resurgence of enthusiasm within progressive ranks. In fact, the real story of Election 2010 wasn’t the great turnout of Republican supporters, but rather that blacks and young voters stayed home. If even half of those who poured out to the polls in 2008 had been moved to vote, the election results would have been much different.

But whatever the case, the 2010 election is over, the Democrats got their collective butts kicked, and the Republicans have already started Campaign 2012. Republican leaders now insist that the election was a refutation of President Obama’s policies and promise a Republican led Congress that will focus on jobs and the deficit.

Americans rightfully rejoice that the promised focus is exactly where it should be, but in what has become the united chorus of one-trick-pony conservatives, the legislative remedy being offered is the extension of the Bush tax cuts for the wealthy. In fact, fed by their new found sense of power, Republicans have become more intractable regarding any compromise on the wealthfare benefits and now insist that the extensions for the rich be made permanent.

Prior to the election, Republicans seemed amenable to a potential decoupling of the cuts along the lines suggested by President Obama. The notion was that cuts for the top 2% might be extended for a limited time period while those for the bottom 98% were made permanent. But according to House Minority Whip Eric Cantor, there will be no such compromise. In a recent interview, Cantor told Greta Van Susteren of Fox News that the election gave the GOP a mandate to hold fast and accept only an extension of all cuts.

Just how the Republican leadership can reconcile their position on the tax cuts with their promise to focus on either jobs or the deficit is the subject of some serious snake oil peddling.

According to Cantor, it’s all about clearing up that “uncertainty“ the Republicans keep talking about: “We’ve got to put certainty back into the game and get these tax rates to stay the same.” But of course this is complete nonsense, since whichever way the cuts are decided, once the decision is made, the uncertainty is removed.

To the man, each of the Republican leaders has also associated the cuts for the top 2% with small business, claiming that 50% of small business revenue will be affected. Sadly, the small businesses they’re referring to are large hedge funds, law offices, and billion dollar companies like Bechtel and Koch Industries. These are the clients of the Republican Party, not the 98% of all small businesses that make less than $250K.

The sad truth is that no respectable economist believes that cutting taxes for the rich will do anything to create jobs. That horse just doesn’t run anymore — not since the results of 8 years of the Bush presidency where such cuts were a mainstay were tabulated and found to be severely lacking. The worst job creation record since the 1940s and the first decline of median household income of any cycle since 1967 are not sound arguments for repeating the policy.

And where the tax-cuts-create-jobs argument is no more than a con-job, even that bar is too high when discussing the impact on the deficit. Virtually all reputable economists agree that tax cuts are the worst form of economic stimulus, and cuts for the rich the worst of all. The Republicans are essentially without even a distorted con to explain away the $700 billion cost of the tax cuts for the top 2% over the next 10 years.

The cuts the Republicans are fighting for won’t create jobs but will add significantly to the deficit. These “fiscal conservatives” espouse fiscal responsibility and feign help for small business and middle-class America but willingly sacrifice both for the wellbeing of their corporate overlords. And the Democrats respond by offering compromise.

Just what part of slam dunk, hanging curve, lob-ball pitch do the Democrats not understand?

The Democrats need to go back on November 15 and work to pass the extension of the Bush tax cuts for those making under $250K during the lame duck session. It’ll be interesting to watch the Republicans argue why the very rich need the cuts and explain to the American people why increasing the deficit for those who don’t need the money makes sense. Their argument promises to be a mind-numbing spectacle of double-talk and diversion.

This is a win-win for the Democrats — any compromise is just once again playing into Republican hands and allowing them to set the agenda and color the conversation. The Democrats need to accept the fact that the Republicans who would not negotiate in good faith while in the minority are certainly not going to do so now. They need to figure out that the Republican campaign for 2012 has already begun and launch their counteroffensive. If they’re not willing to do so, they might as well just start packing their bags now.

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Article first published as Indictment of the American People on Technorati.

The 2010 midterm election is more an indictment on the American people than the politicians of either party.

The Democrats spent the last 22 months trying to save our nation from the ravages of Republican rule. They made mistakes along the way, but everything they did was a move toward helping and protecting average Americans. Meanwhile, instead of helping to create jobs and restore the economy, the Republicans did everything possible to force extended suffering for their political advantage — tragically, the American people have rewarded them for their treachery.

Way to go America!

For the record, President Obama and the 111^th Congress inherited the worst American economic collapse since the Great Depression. The average American household had lost a quarter of their wealth, $13 trillion in all. The Dow would close at a low of 6,547, with stocks overall dropping from a high of $22 trillion to $9 trillion. Job loss was at 3 million for 2008, and the economy was still shedding more at a rate of over 600,000 per month.

The first action the new Congress took was to stop the hemorrhaging with the federal Stimulus. Split between $228 billion in tax cuts for 95% of Americans, $224 billion in funding to help the unemployed and prop up Medicaid, and $275 billion for direct investment in job creating infrastructure, energy and technology projects, the legislation passed the House without a single Republican vote.

The very same Republicans who had voted in favor of spending $700 billion to bailout Wall Street bankers just three months prior, suddenly became budget conscious and adopted intransigent positions against spending to help average Americans. Republican leaders, including John Boehner and Eric Cantor, rallied to the aid of Wall Street but dug in their heels and fought against helping Main Street.

In retrospect, it’s obvious that the writing was already on the wall the moment that President Obama took office. The initial action of a Republican minority to oppose the Stimulus grew into unrelenting opposition to any form of legislation that would help the American people, impede the unfettered profiteering of Wall Street, or slow the offshoring of jobs.

While the Democrats continued striving to keep the average American’s nose above water, the Republicans did everything they could to make sure they kept choking.

Democrats attempted to address the issue of more than 45 million Americans without healthcare insurance. And instead of working to ensure that any legislation was effective, instead of embracing reform to deal with skyrocketing costs, the Republicans blocked all attempts without compromise. They fought to maintain the profits of healthcare insurers and Big Pharma and instead of helping to govern, seized the opportunity for political advantage with fear-mongering sound bites about the “government takeover” of medical services, death panels and the coming of Armageddon. All incidentally complete lies!

The Democrats later attempted to pass Wall Street reform to prevent a future round of too-big-to-fail collapse and bailout. The Republican response was to meet with the Wall Street bankers and plan their strategic opposition. The bill passed the House, again without a single Republican vote, but it was in diluted form in order to gain any minority support in the Senate.

For 22 months, the Republicans fought every action taken to create jobs. They opposed legislation to address the rising costs of education. They attempted to block Democratic efforts to close tax loopholes and stop the bleeding of jobs overseas. They fought against repairing our infrastructure, against small business aid, against unemployment insurance, against saving the jobs of teachers, nurses and firefighters. They argued against the President’s attempts to hold BP responsible for destroying the ecosystem of the Gulf and blocked efforts to increase their liability limits. They battled against climate legislation, clashed on the issue of gays in the military, and resisted all attempts to require disclosure of campaign funding sources They even opposed legislation to lend aid to 9/11 first responders and stood against extending the Bush tax cuts unless the extension included the richest 2%.

The bottom line is that the Republicans did everything they could, from gross distortion to outright lying, from uncompromising rhetoric to unprecedented filibuster to stop any form of legislation that might improve the lot of average Americans. Their aim was to make things as bad as they possibly could for the American people in order to leverage their misery for political gain — and they were rewarded for it.

Manipulated to feed the source of their exploitation, the American electorate deserves an indictment for societal insanity. But there’s no sense in convening a jury, because all evidence points to the conclusion that the defendant is already brain dead. This is a sad day for America.

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