President Obama broke new ground today with the most forceful Progressive speech of his career. In fact he may have made history as the first President in the modern era to attack the core Republican economic gospel by name, known as Trickle Down Economics. Today we fondly refer to it as Reaganomics, named for its first successful proponent in the modern era.
Obama asserted that Republicans have always believed in this nonsense. He is mostly correct, it was common belief in the roaring 20s, but “government by and for the rich” did fall out of favor in the 30s. It made a brief comeback again after the 1947 Republican Congress threw out the New Deal over Truman’s vetoes. They quickly plunged the country into recession, and this resulted in the Democratic landslide of 1948. The Republicans didn’t hold the House again until 1994, that was when most people who saw the Great Depression start were dead.
Obama is not the first President to take on Reaganomics, that is if you count GHW Bush, but he wasn’t President at the time. He famously called it Voodoo Economics, and he was right of course. After Reagan beat him in the 1980 primaries, Bush decided that the average American was really as crazy as an outhouse rat and they would fall for the scam.
You see the bulk of Republican voters actually believed, and still believe that they live in the penthouse suite of the conservative high-rise outhouse. This insanity even spread to the so-called Reagan Democrats in the 80s. Mostly union workers, they started thinking of themselves as capitalists, and not the pee-ons that Reagan was about to make them into. Even today there are people who make less in a year than a Wall Street banker or corporate CEO makes in a minute, and yet they still believe they are part of the 0.01% that is actually benefiting from Trickle Down economics.
The real damage didn’t even come from Reagan slashing the 74% tax rate for multi-million dollar incomes to 28% that did the real damage, but the total decriminalization of looting and pillaging. It did help to promote mergers and acquisitions (that became legal under Reagan) to be able to pay a CEO more money than he could hope to in a lifetime, and pay little of it in taxes. The CEO would then eagerly promote the gutting of the very company he was supposed to be protecting.
Where were the shareholders while this went on? They were deceived into believing that they were making a killing on stock swaps that pumped up the market, stock that went to nothing in the Reagan market crash. Not to fear though, Reagan’s invention of the 401(k) pumped up the market again. That was until the Dot.com bubble burst, and that little crash in 2008. The younger Bush wanted to pump the Social Security Trust Fund into the market too, he predicted a DOW of 40,000. What a crash that would have been.
Millions of small businesses have disappeared in the years since Reagan and his acolytes allowed the Walmart plague to spread across the country. Real union jobs that actually pay union scale are becoming non-existent. Millions of family farmers have lost their farms, soon Willie Nelson can give a Farm-Aid concert for all the farmers right on his bus. The wealth of most Americans is only in their homes, and 25% of them are worth less than they owe.
The average working man makes half of what he did pre-Reagan, if he has a job at all. The average 401(k) has only recouped 48% of its losses taken in 2008 despite the markets having recovered fully, and the next crash will be much worse. That’s only a fraction of what they’ve been doing to you, that’s the way Reaganomics works for the 99%. And if you complain, you’re told it’s just raining. www.prairie2.com