October 29, 2011
President Obama in his weekly radio address conceded that the “middle class has lost ground while the wealthiest few have become even wealthier, [which we have known for some time.] In fact, the average income for the top one percent of Americans has risen almost seven times faster than the income of the average middle class family. And this has happened during a period where the cost of everything from health care to college has skyrocketed,” reported in USA Today.
He stated the Congress is “playing politics” and that his Jobs Bill sets out to provide “common sense” proposals to create and save jobs for teachers, veterans, construction workers and first responders reminding Congress that both Democrats and Republicans have supported these kinds of proposals in the past.
Further, 7 in 10 millionaires are willing to pay higher taxes, but the Republicans in Washington are not listening. The president spoke emphatically that “The middle-class families who've been struggling for years are tired of waiting. They need help now. So where Congress won't act, I will.”
Expanding mortgage loan refinancing to rescue people in danger of foreclosure announcement last week is an example of his using executive order bypassing Congress.
The Republican response was given today in a radio address by Rep. Bobby Schilling, R-Ill., said “Obama and the Democratic-run Senate are the ones refusing to cooperate on a Republican jobs plan that emphasizes fewer regulations on businesses.”
“For the last 14 years, we've been the proud owners of Saint Giuseppe's Heavenly Pizza in Moline.” Between Herman Cain and Bobby Schilling, there seems to be a pattern of pizza ownership in the GOP. This characterizes in a unique way how the millionaires—or close to it—have capitalized on the purchasing power of the middle class, yet it is these people they are compromising by not passing legislation that puts them back to work, so they can have an extra $25 to go out for pizza.
The Republican’s ideology of trickle down or supply side of economics continues to pervade the conversation. Rep. Schilling spoke about the so-called forgotten bills, “These bills are common-sense bills that address those excessive federal regulations that are hurting small business job creation. They were written after listening to the farmers, manufacturers and small businesspeople from around the country.” The concept here is that by relaxing regulations, businesses will have more money to create jobs, but is there any empirical evidence proving this?
Why Supply Side Economics Doesn’t Work
This philosophy banks on the good will of employers to be benevolent and use the money they save to create more jobs. But do we have any evidence of this? According to faireconomy.org, “Overall, data from the past 50 years strongly refutes any arguments that cutting taxes for the richest Americans will improve the economic standing of the lower and middle classes or the nation as a whole.
The economic indicators examined in this report are dependent on a variety of factors, not just tax policy. However, what this study does show is that any attempt to stimulate economic growth by cutting taxes for the rich will do nothing -- it hasn't worked over the past 50 years, so why would it work in the future? To put it simply and bluntly, Bush's top-bracket tax cut is an ineffective attempt at stimulus that will not cause any growth -- unless, of course, if you're talking about the size of the deficit.”