Those living in the right-wing bubble have at least one thing right. America does have “makers” and “takers.” But the real “takers” are the wealthy, not the lower-income people Mitt Romney infamously branded the “47 percent.”
What radical right-wing ideology supporters generally fail to point out is that the US tax system is designed to reward the wealthy and penalize everyone else. It also creates the need for public assistance programs that ultra-conservatives refer to as the American welfare state.
The rigged American socioeconomic system has ended up producing a relatively small group rich people who use loopholes avoid paying taxes, and poor people trapped in poverty by their own government, because if they can’t make it to the top 2 percent, they end up struggling even more.
Part of the problem is in safety net income thresholds that are set at such outdated levels, they encourage failure and fraud. In a recent appearance on MSNBC’s "The Rachel Maddow Show," Nobel Prize-winning economist Paul Krugman put it this way:
“In our system … the biggest disincentives to work … are for lower-income workers who are in that range where if you earn a little bit more you start to lose benefits, you start to lose Medicaid, you lose housing subsidies.”
In Georgia, for example, the income cut-off for Medicaid can be as low as $208 per month. Therefore, if the additional income that disqualifies low-income workers from government benefits is not enough to make up for lost assistance, they end up being stuck living on the edge of poverty and dependent on the government to survive.
Up to this point, the radical right-wing conservative-types seem to have a valid argument against creating an environment of government dependence. But this is actually an ideological delusion rooted in what is fundamentally wrong with radical right-wing conservatism.
Let’s do the math. The reason so many people need public assistance for food, housing and health care is that too many US employers are unwilling to provide benefits or pay their employees a living wage, which is currently about 30 percent more than the federal minimum wage.
Conservatives routinely balk at the mere mention of raising the minimum wage with unfounded claims that it will “kill jobs.” However, it is the entire concept of supply-side economics that is the real failure of right-wing politics.
The conservative formula of keeping wages low to protect corporate profits creates an entire class of people with almost no opportunity for upward economic mobility.
If the minimum wage is $8 an hour, and a living wage is around $12 an hour, people working for less than what’s needed for the basics have no leftover cash to feed their kids, buy a new car every few years, or pay for a college education or trade school that might bring them to a higher-paying job. It all adds up to profound limitations on overall economic growth.
Ending government food assistance, housing, unemployment benefits and education grant programs does not solve the problems of income inequality, poverty, and a shrinking middle-class—it makes them worse. For every federal dollar spent on unemployment, for example, $1.60 goes back into the economy.
America cannot cut its way to prosperity.
“Nearly 40 million more Americans are only staying out of poverty with the help of programs such as Social Security, food stamps, and the earned-income tax credit. According to the Center on Budget and Policy Priorities, without these programs in place, the poverty rate would nearly double,” according to Moneynews.
If either Republicans or Democrats were serious about creating a better America, they would not suggest that more austerity is the answer. Instead, they would fully support replacing the minimum wage with living wage standards. In doing so, the need for the “welfare state” would be greatly reduced or eliminated. Also, with more money in people’s pockets, more would flow into our consumer-driven economy, and the broadened tax base would contribute to reducing the deficit.
This is not a secret formula for economic success; it’s common sense and math.
The only thing stopping prosperity from becoming reality is politicians who are afraid that their wealthy donors will dump them in favor of different elected puppets who will do their bidding to protect their profits from rising wages.
PoliticusUSA calls the right-wing Republican ideology that favors the rich a “real threat to America,” explaining it as follows:
"Many of the same individuals who received billions of dollars from the government in the bank bailouts … are currently spearheading a campaign to demand billions of dollars in cuts to social programs while billions more are requested for corporate 'incentives' like tax breaks …
"CEOs of companies ranging from TimeWarner and Honeywell to Boeing and General Electric, are all part of Campaign to Fix the Debt, a project of the Center for a Responsible Federal Budget.
"Fix the Debt is really just an advocacy organization for people who deeply believe in disaster capitalism and austerity measures. Their solutions for resolving the debt 'crisis' always revolve around funneling more money toward the wealthy through tax breaks for both corporations and upper income people while making dramatic cuts to the social safety net."
In the real world, the millionaires stumbling through the halls of Congress have probably never met anyone thriving on or contemplating the American dream, working for eight bucks an hour.