The new numbers are out. The typical American worker received a $200 raise last year, an increase of 1/2 of one percent. The Typical CEO of a Fortune 500 company enjoyed a raise of $2,000,000, an increase of 23 percent. It looks as if good times are here again.
Maybe the Republicans are right; if you sprinkle enough money and tax breaks on the wealthy and on corporate America, the economy will improve. Corporate profits are up, dividends are up and those corporate jets are getting a real work out. Since 2008 the market has come up over 52 percent, and it is expected to increase another 11 percent by the end of 2011.
In fact, according to the Federal Reserve, our U.S. corporations held a record $1.93 trillion in cash on their balance sheets of 2010.
The Republicans call this “Trickle Down” economics. This theory holds that if you cut taxes enough and give tax breaks to corporations, then good economic times will trickle down to the rest of us. After 20 years of collecting data, most economists dismiss this theory as a failure.
Nonetheless, the Republicans continue to treat this theory as an article of faith. They are opposed to closing any of the loop holes that companies are using to send our jobs overseas or to increase any tax on the wealthy who now pay less tax than any time since Harry Truman was president.
We are at a critical point. The debt ceiling must be raised. We must borrow more money to pay for programs that Congress, long ago, appropriated and spent. It is like getting a credit card bill for stuff you bought last month.
And just like us, if the United States defaults, our credit rating will crash and our interest bill will go through the roof. This will almost guarantee another even deeper national recession.
The Republicans’ answer to the debt ceiling crises is to cut spending. They absolutely refuse to close a single loop hole or raise taxes a single penny on the wealthy. But if you only cut spending to solve the problem, you will have to cut deeply into the programs that most Americans depend on. Of course for the Republicans, that is a plus.
After all, very few of them need the social safety nets developed over the last 70 years to protect the rest of us. As far as they are concerned, Social Security, Medicare, labor law, OSHA and environmental protection are just socialist schemes that interfere with the “free market” that they depend upon to keep profits up.
So, if you got a 23 percent pay increase last year, or your corporate jet is fueled up and ready to go, you are rooting for the Party of No. But, if you did not get your $200 raise last year because you are unemployed or you are depending on Social Security or Medicare, you might consider rooting for the another team.
Louis Vitale — Franklin, N.C.