There is a reason why it has taken so long to emerge from George W. Bush’s Great Recession. And the Republican leaders of the House and Senate with their new majorities typify why we have barely emerged from it; and one of the reasons why I think we are headed full speed for another Great Depression.
As I stated a few years ago on this website, it’s a matter of when, not if (Will It Actually Take Another Great Depression? November 10, 2011).
Why? Because the Republicans either just don’t get it, or they just don’t care. Their policies that continue to distribute wealth upward hamper not only meaningful, long-term economic growth, but our standing in the world. We are far from the only economic powerhouse. In fact, we continue to shoot ourselves in the foot by electing this bunch of irresponsible, voodoo economic Republicans.
Also for several years on this website, I’ve tried my best to explain the difference how and why the business of government cannot, and will not, function in the same manner as a business or even a personal check book. But Republicans continue to successfully push the propaganda to their followers that they can, and worse, that they should. (The “Redistribution” Big Lie Dec. 14, 2011; Proof That Austerity Does Not Work in a Recovering Economy; Another Alarming Failure of “Reagan” Economics March 25, 2012; Forget Dodd-Frank: Reinstate Glass Steagall March 1, 2012; Stop the GOP Assault on the U.S. Economic Future May 10, 2012; GOP Austerity Gobbledegook De-bunked: Again! June 12, 2012; etc., etc.).
Still, they continue to attempt to downsize government and block regulations of any kind, including Dodd-Frank (see link above), when it was the lack of adequate regulation during Republican GW Bush’s term that caused the financial meltdown and Great Recession. This is while the lack of government spending on basic public works projects has been a major drag on economic growth, and literally threatens millions of oblivious Americans’ lives as they drive to and from work and school over bridges that were designed and built in previous centuries!.
It is baffling to me that NRA supporters who purportedly place the safety of their families and future above all else will allow Republicans to endanger millions of them every day by starving government of its means to give even minimal support to repairing our crumbling infrastructure.
Throughout the ill-timed austerity pushed by Republicans and whose promulgation was obstructed by Republicans, there was a corresponding decline in output of more than 6 percent of GDP — that’s 6 percent of the now $16 trillion in goods and services that were never produced, while some 8 million workers lost their jobs causing incalculable damage to families and communities.
Yet Republicans still intone the same tired, albeit convincing to Americans who can’t even balance their own checkbook, messages that regulation of any kind is harmful.
“The administration’s biggest hit on the economy has been the aggressive over-regulation that has descended on virtually all of American private enterprise and that’s the reason we’ve had such a slow recovery after the Great Recession of 2008,” said new Senate Majority Leader Mitch McConnell. “It’s reasonable to assume that we’ll be pushing back against this bureaucratic excess across the board.”
It’s like listening to Tokyo Rose and believing that whatever is said must surely be true. Moreover, all one must do is read a bit of history on the Roman Empire, which had the exact same opposite political divisions 2,000 year ago…and despite their massive achievements and vast superiority over other simultaneous social systems, they went the way of the dinosaur because of unchecked capitalism which eventually led to the wealthiest 1% killing the goose that was laying the golden eggs….the thriving middle class.
The cries from the unheard masses is heard daily, “Fix our broken Tax Code, address the debt that’s hurting our economy and imprisoning the future of our kids and grandkids, reform our legal system, reshape our regulatory policy to make bureaucrats more accountable, and give parents more choices in a system that isn’t educating enough of America’s children.”
But Republicans haven’t helped; instead they allow wealthy donors to direct their every move. They have fought almost every growth stimulus program, and tanked the economy to boot, with the debt ceiling debacle that shut down government and downgraded the government debt.
Now, if unchecked, they will to do it again with their new majorities made possible by a voter turnout of barely over one-third of the population. In an attempt to keep their diminishing power base, they restrict voters’ right, collective bargaining and oppose minimum wage programs of any kind that would increase household incomes.
They believe supply stimulates demand, when it is exactly the opposite. The increasing demand for goods and services—combined with a middle class that has discretionary income to spend on more than just bare necessities and the confidence that they will continue in their jobs—stimulates supply and profits, from increasing household incomes. So when they oppose raising the minimum wages and collective bargaining, they are literally restricting the growth of household incomes, and thereby growth.
And the result is a very deflationary environment that becomes a vicious circle. Falling prices mean falling profits, meaning falling incomes and rising unemployment. It’s as simple as that, yet Republicans don’t seem to get it.
It has also led to the greatest income and wealth inequality since 1928—not coincidentally, it led to the Great Depression.
One last caveat…the last Republican administration and Congress to reduce the federal debt was Herbert Hoover’s administration and the corresponding Republican Congress—which also led directly to the Great Depression.
Don’t believe me? How about UShistory.org?:
“By 1929, companies had expanded to the bubble point. Workers could no longer continue to fuel further expansion, so a slowdown was inevitable. While corporate profits, skyrocketed, wages increased incrementally, which widened the distribution of wealth.
The richest one percent of Americans owned over a third of all American assets. Such wealth concentrated in the hands of a few limits economic growth. The wealthy tended to save money that might have been put back into the economy if it were spread among the middle and lower classes.”
Harvey A. Gold