Politics and Insights from History

Yesterday, Barack Obama once again delivered a speech. This time he was in Kansas; something that he almost forgot. Perhaps if Obama stayed in one place he might remember where he is. Yesterday, was December 7, Pearl Harbor Day. Instead of talking about it and commemorating those who died that day, he had to give a speech about how the wealthy don’t pay enough, America is unfair, and how only he knows best.

The bulk of Obama’s speech was basically chastising the rich for being rich. He claims that he wants to build the shrinking middle class. Except, the middle class is shrinking because the government keeps enacting policies that increase the cost of living and force businesses to cut costs by firing people.

Obama slammed Republicans and Conservatives who believe in Reagan’s trickle down economics theory, and who believe in cutting taxes for everyone who actually pay taxes and in cutting government regulations that hinder economic growth and development. Obama claims that Republicans have no ideas and only hold to what doesn’t work. If Reagan’s tax cuts and deregulation did not work, then why were 1980s a decade of economic growth, a prosperity that continued through most of the 1990’s despite Bill Clinton’s increase in taxes and regulation? Obama claims that the Bush tax cuts led to the recession we are in now. If that is so, then how come unemployment under bus remained under 6% until the last few months of his presidency when the housing market collapsed? Meanwhile, Obama’s policies made unemployment shoot up to 10% and the economy is now stagnated with a 9.1% unemployment. But according to Obama his not so new socialist ideas are working.

Obama rants that Republicans have no new ideas. But He and his fellow Democrats have no new ideas either. IN fact, everything they do is just a throwback to F.D>R.’s New Deal programs. Neither side has new ideas and it doesn’t matter if they do or not. What is important is if they have good ideas that actually work.

Almost every other paragraph in Obama’s speech yesterday was him whining how the wealthy don’t pay their fair share. What is fair about 50% of Americans who pay no taxes but receive government welfare from those that actually pay taxes? That’s fair? Taking money from someone and giving it to someone else to fulfill your ideological sense of fairness is fair? Obama claims that a billionaire only pays 1% of his income in taxes while someone earning 50 grand a year pays more. Let’s do the math? Say a person who earns $1 billion annually pays 1% in taxes. That equal $10 million that goes to Uncle Sam. Now take the guy who earns $50 thousand and pays 38% of his income in taxes. That amounts to $19,000 that goes to Uncle Sam. Despite the differences in the tax rate, who still pays more to the government? If this still seems unfair to some of you, why not get rid of the current tax code that even the IRS cannot make sense of and institute a flat tax, where everyone, regardless of their income level, pays the same tax rate. Let’s say the billionaire in the example above still pays 1% of his income in taxes, but now the guy earning $50,000 also pays only 1%. This means that the he will only pay $500 of his annual earnings to the government.

Interestingly, Obama is pushing an extension of the payroll tax cut. But just a few months ago he proposed increasing taxes. Also, he is pushing the extension of a tax cut, while in the same speech he claims that tax cuts led to the “greatest economic crisis since the Great Depression”.

Another thing Obama falsely claims is regarding the 1920s. Obama claims that deregulation and tax cuts led the disaster of the 1920s. The 1920 were the most prosperous decade in our history because we had presidents who deregulated and cut taxes and then minded their own business. Remember Calvin Coolidge? The reason why the stock market crashed in 1929 was because under President Hoover, the government began meddling in the economy again. Then Obama praised F.D.R. whose polices kept us in the depression. His New Deal programs were so great that while the rest of the world recovered economically the U.S. continued to have double digit unemployment and a stagnant economy.

Obama’s speech was the same speech he’s been giving since he was elected. Basically, according to Obama America is unfair, capitalism doesn’t work, the wealthy are too wealthy and could do with less, the poor just need a government program to make it, and, well, the world’s just not fair. This coming from a guy who is going to spend 17 days in Hawaii for his Christmas vacation. Isn’t this something those wealthy CEOs do?

This is a 45 minute presentation that explains briefly what Trickle Up, Trickle Down, and Supply Side economics are.  Hope you all find it helpful.   (Note: In the the first video when you here “9 million”, it’s supposed to be “9 trillion”.)