ALEC Distracts Electorate From Economy, Jobs; Is It Too Late?

Even the most clueless Americans are beginning to look up from their smartphones and tablets and see the severe ideological crevasse that distinguishes progressives from conservatives, whether it’s on economics, morality, patriotism, or whatever the ALEC-controlled red-state legislatures can use to keep women, blacks and Hispanics in survival mode through either abortion or immigration standoffs.

Ever since 9/11–when the GOP somehow convinced white people that they were the only ones who could keep America safe from terrorists despite the fact that it was during their watch that the worst attack on U.S. soil happened—they realized that with enough money and sufficient distractions, the clueless white middle-class could be convinced of just about anything. I assure you, The reports of the GOP’s demise is greatly exaggerated.

Let’s deal with most overlooked item, the economy; a subject on which the GOP has been masterfully keeping the well-meaning, but woefully out-strategized and out-spent, and out-propagandized Democrats on the defensive as easily as they played them regarding the Bush administrations failures in keeping the country safe from terrorists.

As Usual, President Obama Makes a Great Speech But to What End?

In his speech on Wednesday, July 24th president provided a masterful summary of the mainstream progressive narrative about the U.S. economy from 1945 to 2009:

“In the period after World War II, a growing middle class was the engine of our prosperity. Whether you owned a company, swept its floors, or worked anywhere in between, this country offered you a basic bargain – a sense that your hard work would be rewarded with fair wages and benefits, the chance to buy a home, to save for retirement, and, above all, to hand down a better life for your kids.

        But over time, that engine began to stall. That bargain began to fray. Technology made some jobs obsolete. Global competition sent others overseas. It became harder for unions to fight for the middle class. Washington doled out bigger tax cuts to the rich and smaller minimum wage increases for the working poor. The link between higher productivity and people’s wages and salaries was severed – the income of the top 1% nearly quadrupled from 1979 to 2007, while the typical family’s barely budged.

Towards the end of those three decades, a housing bubble, credit cards, and a churning financial sector kept the       economy artificially juiced up.”

That’s a pretty damn accurate assessment of the progressive theory of the case. In 2008, not only did the stock and real estate bubble of the 2000s burst, but the larger entire Bubble Economy which had been “artificially juiced up” since Ronald Reagan’s voodoo, supply-side economics went down the crapper.

If you accept this thesis, as most progressives and economists who live outside the influence of lobbyists and various other snake oil salesmen do, there will never be a return to the pre-2008 crash “normality”— because from Reagan to George W. Bush the “normal” was a slowly and meticulously built house of cards, sustained by the Keynesian stimulus provided by Reagan’s and George W. Bush’s military build-ups and the stock market and real estate bubbles fueled by tax cuts for the rich.

Note: Conservatives, of course, oppose Keynesian stimulus in the form of productive infrastructure investment, but support Keynesian stimulus if it benefits defense contractors, real estate speculators, Monsanto, Chemical producers, large pharma and hedge fund managers.

In the progressive view, rebuilding a broken economy requires productivity-enhancing investment in manufacturing, innovation, infrastructure and education. In his speech, the president called for federal action in all four areas.

For a fundamental contrast, the “House Republican Plan for Economic Growth and Jobs” was publicized as an alternative to Obama’s speech. Unlike progressives, the House Republican leadership does not bother to present an historical context illustrating the bifurcation of productivity growth and income for most Americans over the last generation.

The conservative Republican historical piece of fiction — that the U.S. economy was just fine in the age of the Robber Barons when even more wealth was concentrated and extreme in its inequality—worked until Franklin Roosevelt came along and screwed everything up. Reform for today’s radicalized right means successfully destroying every safeguard enacted since the lessons learned from the Great Depression by restoring the bruyal, unregulated capitalism of the late nineteenth century.

Short on vision, much less specifics, the House Republican plan is short on good sense as well. It proposes “3 ways to immediately grow jobs and strengthen the middle class”—approve the Keystone pipeline, pass the SKILLS Act to reform job training, and expand offshore domestic energy production.

Except for the undeniably fictitious promises from the pro-Keystone pipeline propaganda, I would mildly support these proposals. But the few full-time jobs that pipeline construction would create—if any, given that it’s a unspoken fact that Canada will bring their own Canadian full-time engineers, leaving mostly part-time, benefit-less jobs for Americans, though helpful, cannot compensate for the high unemployment that Republican-backed austerity policies needlessly have inflicted on the U.S., by means of the sequester and lay-offs of public sector workers during the Great Recession.

Even the editorial board of Gannett’s USA Today — hardly a bastion of left-liberal tenets — agrees. In a rebuke of conservative economic doctrine, USA Today dismissed the conservative claim that excessive government regulation is a major cause of the weak recovery, compared to austerity:

“…the biggest factor is the most obvious: austerity…. In the public sector, 629,000 government jobs have been axed since December 2009, mostly at the state and local level, putting a further damper on demand. On top of that, the federal government has aggressively cut spending and hiked taxes as the result of budget deals in 2011 and early 2013, and the automatic cuts known as the sequestration….Coming as the economy was struggling to regain some momentum, austerity has taken its toll. Economists estimate that the government cuts alone have kept the unemployment rate at 7.6% when it would otherwise be about 6.5%”.

When even USA Today goes for Keynesian dogma instead of going Galt, the Right is clearly losing the argument about the economy. Conservative Republicans have enough power in Congress to block most of the progressive agenda. But they do not have a plausible alternative to the progressive vision of the past, present and future of the U.S. economy that President Obama has set forth. Hence their multitude of ALEC-driven socio-moralistic agendas being driven in red state after redstate, if for no other reason, than to keep the semi-comatose poor white base in control of the House Republican caucus while Speaker Boehner spends his days and nights swimming in his Smirnoff-induced stupors.  

The Other Shoe: Economic Inequality in the New Wall Street Bubble

Whatever growth in GDP or reductions in unemployment is blazoned across the 6:00 “News”, most Americans think the economy stinks…as well they should.

The Dow Jones industrial average and the broader S&P 500 are hovering near record highs. At the same time, income inequality has surged. From 2009 to 2011, 121 percent of income gains went to the richest 1 percent of the population. The 99 percent beneath that select group saw their incomes fall by about a half a percent over the same period.

The trend seems all the more exasperating given that it takes place against a backdrop of steeply rising employee productivity. Even as workers function more efficiently, they are rewarded less. President Barack Obama described a “winner-take-all” economy in which the gains of the top 1 percent has quadrupled while the rest of the country has barely budged.

The Federal Reserve, under Ben Bernanke, has successfully kept inflation low but because of GOP obstructionism to every job-creation policy that comes from the Senate or White House, has done little to promote full employment. Critics say he has erred far more cautiously on the side of low inflation. That tension also falls along class lines — bankers, of course, hate inflation because it means the money they have loaned is paid back in a depreciated currency. Workers, on the other hand, are less concerned by mild inflation and helped far more if easy money leads to more jobs.

At the bottom of the ladder, the minimum wage long ago fell behind increases in the cost of living.  

Obama called for hiking the minimum wage in his speech Wednesday. While he’s likely to run into the same buzzsaw of opposition not only from the GOP but from some members of his own party, there are measures he can take unilaterally. Amy Traub, an economic policy analyst at think-tank Demos, said Obama could, without any interference from Congress, set wage floors for hundreds of thousands of workers employed by government contractors.

Liberal economists pin part of the blame for declining worker earnings on the demise of union organizing, which historically helped not only union members but also other workers, whose wages and benefits were pushed higher by the precedent of collective-bargaining agreements.

With the pay of top executives aligned with the share prices of the companies they run, few efforts are spared to cut costs and boost short-term profits. The result: Job cuts, stagnant wages, and cuts in research and development. Economists at the Economic Policy Institute found that average CEO pay at the country’s largest 350 companies was $14 million in 2012, up 37 percent since 2009.

That kind of disparity, one would assume, would be a major component of Democratic strategies to use to offset ALEC and the Koch Bros. propaganda agendas of austerity and union-busting. Unfortunately, the Democrats, as usual, are playing defense and losing ground at the state level.

If they don’t start now, in countering those ALEC-driven strategies by beating the GOP at their own game by getting the adversely-affected minorities the proper IDs and the proper motivation and methods to get to the polls, the GOP will have won the war from the inside out by winning the popular vote, state after state, but continuing to lose House Seats until the house of cards built by ALEC and the Koch brothers crumbles into the next Great Depression.

Harvey A. Gold

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