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US elections reveal a growing discontent
Dick McDonald
Americans went to the polls in November to voice their discontent. They voted to replace a moribund Republican majority who didn’t limit government with an issueless group of Democrats predisposed to grow it. George Will instructs us that this is America’s “market economy” at work. Americans were frustrated by Republican impotence and were forced to vote their only alternative. Americans intuitively know there is something desperately wrong with their body politic and they vented their “growing discontent”.
Congress still languishes with a 14 percent favorability rating. Even a much vilified President polls three times greater than that. Republican leaders and philosophers are running around asking what went wrong and bleating that what they need are some real issues to run on and recapture their power. Heavy weights like Newt Gingrich are offering up such lame solutions as disbanding the Ninth Circuit of Appeals and establishing English as our national language, David Brooks, the token Republican on the New York Times editorial staff just changed his registration to “independent” out of frustration from a lack of substance. Kids by the droves are opting for “Independent” voter status because neither party is appealing to their needs.
When the country is in such a dramatic state of frustration we must look to the bread and butter issues that underlie the Republic’s promise to provide for the common welfare. Statistically the economy looks strong. There should be and there usually is a positive vote for the man that brought you to a successful economic dance. Why not this time? Why did the people opt for the polar opposite of what they believe in?
If you want answers, look to economy. America’s structural problems are always and will always be defined by the “Boston Tea Party”. If the majority of the people are uneasy, they are going to dump their perceived problems in the harbor. Congress appears to be that problem. They are out of control making promises they can’t keep, spending the growth in revenues from a good economy as fast as they can on pork for their financial supporters, looking the other way on reforms that would actually reduce the size of government and spending inordinate amounts of time positioning for power instead of doing the people’s business.
Americans know something is wrong; they just don’t know what it is. I believe it is quite simple; the majority of Americans are not participating in the gigantic increase in wealth our economy is experiencing. Fifty percent of the people don’t own stock and therefore can’t benefit from the 58 percent cut in the dividend tax rate President Bush AND the Congress used to avoid a potential depression. That and a 25 percent cut in the capital gains rate has provided the avenue for those who can compete for the big bucks to become filthy rich. Those without capital just stood still in our capitalist economy.
Easy money and lower interest rates also helped to avoid a depression. Unfortunately the price of everything went up and the Arabs got unhinged about a 25 percent fall in the value of the America dollar. They made a course correction. The value of homes went up allowing refinancing dollars to drive consumption but an over-advertised and over-stimulated consumer gave up saving and plunged further into to debt. Fortunately he plunged into debt to other Americans so the money never left our shores. Unfortunately he just participated in filling the coffers of the rich.
So what to do? The Republicans need to limit government, reduce taxes and create a policy issue to that will still the economic uneasiness of the majority of Americans. They need a modern-day “Boston Tea Party”, Those who read me regularly know exactly where I am going. The only way to accomplish this is to help the poor and middle class get wealthy; entitlements and charity have never worked nor will they ever.
Why not enlist “capitalism” to do the job? Why not let the people keep their 15.3 percent in payroll taxes and invest those funds in indexed stocks for the 40 years of their working life? A $19,000 a-year clerk ends up with a $1.5 million nest egg (2006 dollars) upon retirement at the average rate of return for the S&P 500 for 40-year investment since 1871. That is the premise upon which I wrote Make the Poor Rich which when I get around to publishing it spells out how easily we can finance the transition and how such a sea change in our economic structure will:
Cut America’s annual budget in half.
Give Americans the biggest tax cut in their history
Painlessly pay off all those unfunded entitlement liabilities
Dramatically increase monthly retirement checks, and among other great things
MAKE THE POOR RICH.
Now how is that for an issue Republicans can get behind? A modern-day Boston Tea Party for sure. Now will Democrats will help us make "their" poor rich? I sure hope so.
Dick McDonald can be found at The Right Scale
BrookesNews.Com
Monday 1 January 2007