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Archive for the ‘wealth redistribution’ Category

Overall, the USA rates 75th highest in the world in income inequality, just behind Ghana and Turkmenistan, but ahead of Senegal, Thailand and Zambia, although only nine nations are compared in the graph above. Those are industrialized nations in the graph. Naturally, among those nine the USA is dead last. Why is the USA last among those industrialized nations?

Liars of the corporate news media and their pundits will tell you it is because of technology and automation, as if China, Germany, Sweden and other nations in the graph above don’t have the exact same issues. They do. Yet income inequality in those nations are far less than in the USA.

As you can see from the graph, severe income mal-distribution peaked just before the Great Depression in the USA. That mal-distribution caused the Depression because it weakened the demand for goods and services by the 99 percent.

You can see that a  massive rise  in mal-distribution began in the USA with the so-called Reagan Revolution, which was essentially, something of a coup since the 1 percent essentially stole control of the US government via treason. See The Real October Surprise Really Happened–Christian Science Monitor .

The 1 percent took complete control over the corporate news media around the same time, and sold us a ton of lies, such as trickle down economics, which redistributed income from the 99 to the 1 percent and gave more money to the 1 percent with which they corrupted government. The government redistributed income by signing free trade treaties and other legislation that allowed the 1 percent to ship jobs overseas, and pocket the difference between the higher old wages and the new lower wages.

The press continues to lie to us about a number of things. One of them is that our biggest trade deficit is with the nation of China. No it is not! Our biggest trade deficit is with US corporations as a whole that ship jobs overseas, or create them there which they would otherwise not be able to do without these corporate trade treaties. US corporations also hire foreign contractors and or sub-contractors to manufacture goods and services, rather than US contractors and subcontractors, thanks to these so-called trade treaties. In all of these cases, goods and services are exported to the United States from foreign nations by US corporations such as Apple, Microsoft, General Motors, General Electric, Fannie Mae (call centers in India and Pakistan), Capital One, and many others. The result is a massive United States trade deficit. This is the primary conduit through which income is redistributed from the 99 to the 1 percent.

Wall Street President Barack Obama plans to increase income and wealth inequality in the USA through the Trans Pacific Partnership, the largest income redistribution treaty of all time. Incoming Wall Street Senate Majority Leader Mitch McConnell is completely with the president on this scam. So is Democratic Liberal Wall Street Senator Ron Wyden. The game is completely rigged against the 99 percent, but the fight’s not over.

In other words, income inequality has been brought about by an inequality of political power in government and in both major political parties.

We can stop the madness. There are a great many Democrats in congress who want to get reelected, and so a few simple phone calls by a large number of constituents can sway them. The same is true of many Tea Party Republican members of the US House. Call them and protest. Let you voices be heard. Let them know you’ve had enough of these income redistribution scams.

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On Thursday, November 20, 2014, President Obama announced that he was taking executive action that will allow up to five million undocumented immigrants to stay in the United States. The president promised these immigrants that they will not be deported, that they can seek work legally in the United States, on certain conditions, such as paying taxes.

Much of the news media of the 1 percent are claiming this is good for the economy, that everybody will prosper because of the president’s action.

For example, a study released by the Center for American Progress says, “Once they (undocumented immigrants) attain legal status, immigrants will be able to contribute to the increased consumption of goods and services that boosts business sales and raises the earnings of all Americans. They will pay taxes on their higher wages and increase the gross state product (GSP). Additionally, immigrants will be able to use their new legal status by integrating their skill set and education into creating jobs and raising productivity.”

Common sense, however, tells us that once undocumented immigrants receive legal status, they will consume approximately what they consume today. It is possible that with higher wages they will consume more. That will be offset, however, because the rest of us will be consuming less, according to an analysis of a similar congressional measure by the non-partisan Congressional Budget Office (CBO). According to the CBO, everybody’s wages and job opportunities will decline with the deal, except for the newly legalized immigrants. That means the impact of immigration reform will have little, or no, or perhaps even negative, net impact on the consumption of goods and services. It could even result in a decline of GNP. How could the consumption of goods and services go up if everybody’s wages and salaries are going down? They can’t and so the claim by the Center for American Progress is patently wrong.

According to the CBO, a senate bill similar to President Obama’s executive action which failed in committee last year would have depressed wages of all workers for the next twelve years, “raise the unemployment rate,” and “result in higher interest rates.” Notice the corporate news media hasn’t reported these things to you.

The president’s action will also push the unemployment rate higher than it would otherwise be through 2031. Currently, the real unemployment is somewhere between 10 and 13 percent, which is higher than the official rate of 7 percent. The executive action will force more and more people to compete for a smaller number of jobs, and this will drive wages down.

According to the Pew Hispanic Research Center, 80 percent of undocumented immigrants work under the table, that is without paying income taxes. Most of these people are expected to move into better paying jobs in the legal job market, creating greater labor competition, and driving wages down.

This same process also occurred after the amnesty granted undocumented immigrants in December 1986. Real wages immediately began to plummet for the next six years and didn’t recover to their 1986 level until 11 years later. Check out the graph below from the Bureau of Labor Statistics website. You’ll see a big dip in real wages for everybody beginning in December 1986.

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The CBO also reported, “Capital investment would rise primarily because the return that investors would earn on a given amount of investment would be higher under the legislation than under current law.” The rationale for this is given with economic jargon, but basically it boils down to this; lower wages will increase profit margins, and so members of the 1 percent will purchase more corporate stocks, bonds and politicians.

In other words, the president’s executive action ensures the 1 percent benefit by pushing down wages, salaries and other compensation and redistributing the difference between the old rates and the new lower rates into the hands of the 1 percent. Nice scam, but it gets worse.

The president’s action comes at a time of real declining average wages for all American citizens, and so things are now going to become worse for us. On top of this, the 1 percent has been stealing 95 percent of all income growth for the last four years. Now it might grow as high as 96 percent. We are in an economy heading for disaster.

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In an op-ed for the Huffington Post, US Senator Elizabeth Warren issued a caustic rebut that she would no longer support President Obama and his Wall Street cronies when the president nominates such people to important government positions, such as US Treasury Secretary and Undersecretary of Treasury.

The president has nominated a plethora of such people, showing his links to Wall Street in the process. Gene Sperling (Goldman Sachs) – Director of the National Economic Council Jacob Lew (Citigroup) – Treasury Secretary Stanley Fisher (Citigroup) – Vice Chairman of the Federal Reserve William Daley (J.P. Morgan Chase) – Chief of Staff Rahm Emanuel (Wasserstein Perella) – Chief of Staff Nathan Sheets (Citigroup) – Treasury Under Sec. for International Affairs Stefan Selig (Bank of America) – Under Sec. for International Trade at the Dept of Commerce These are the people that help to rig the economic and political game for the 1 percent and against the 99 percent.

Below is what Warren wrote:

I believe President Obama deserves deference in picking his team, and I’ve generally tried to give him that. But enough is enough. Last Wednesday, President Obama announced his nomination of Antonio Weiss to serve as Under Secretary for Domestic Finance at the Treasury Department. This is a position that oversees Dodd-Frank implementation and a wide range of banking and economic policymaking issues, including consumer protection. So who is Antonio Weiss? He’s the head of global investment banking for the financial giant Lazard. He has spent the last 20 years of his career at Lazard — most of it advising on international mergers and acquisitions. That raises the first issue. Weiss has spent most of his career working on international transactions — from 2001 to 2009 he lived and worked in Paris — and now he’s being asked to run domestic finance at Treasury. Neither his background nor his professional experience makes him qualified to oversee consumer protection and domestic regulatory functions at the Treasury. As someone who has spent my career focused on domestic economic issues, including a stint of my own at the Treasury Department, I know how important these issues are and how much the people in Treasury can shape policies. I also know that there are a lot of people who have spent their careers focused on these issues, and Weiss isn’t one of them.

For the complete story click the link below.

Enough is Enough! Huffington Post

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It should also be pointed out that tax cuts for the rich destroy jobs, because the rich take their ill gotten gains, and purchase legislation from politicians to ship jobs overseas, which does not create jobs, but destroys them, at least here in the United States. That’s just one of the ways tax cuts for the rich destroys jobs. There is not one iota of evidence that any tax cut for the rich has ever created a single net job in US history.

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How does a US corporation pay a 2 percent negative tax rate? It gets a rebate on taxes it never ever paid. So, if Boeing (in this case) made $100 billion from 2008-2013, it paid zero in federal taxes, and received $2 billion from the taxpayers in the form of a check or checks given to the company by the Federal government. Quite naturally, the disbursement of much of that money goes to the shareholders of Boeing, members of the 1 percent. And so that $2 billion represents a massive redistribution of income from taxpayers (the 99 percent) to the 1 percent. Nice scam huh?

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