When George Bush ran for the presidency in 1999, he promised to cut taxes resulting in "...a tax cut to sustain our nation's prosperity and reflect our nation's decency." He went on to promise, "...a higher standard of living for all Americans." Pulitzer Prize winning investigative reporter David Cay Johnston says that those tax cuts actually stole $48,000 from every American taxpayer, a total of $6.6 Trillion (yes with a "T") over 12 years.
Where is the prosperity we are all supposed to be enjoying? Unemployment and under employment are continuing drags on the economy which still cant shake off the last depression. (except for the 1% who are richer today than before the depression of 2008 along with the hedge funds and Wall Street) Students graduate now with debt levels the equivalent of a first mortgage resulting in their inability, as they go into the job market and marry and start families (maybe), to be able to purchase a first home. This undercuts one of the basic foundations of a healthy economy. (much of this debt is the result of lost revenue on the federal and state level due to tax cuts and much of this debt is taken on by the children of the middle class for whom tax cuts were supposed to be a godsend) The job market is dismal for most middle class Americans who watch their productivity increase but their wages do not.
Johnston analyzed long term personal incomes as reported by American taxpayers from 2000-2012. "...in 10 of those 12 years, when the Bush tax cuts were in effect, the average income was lower than in 2000. The total net loss for the taxpayers over those 12 years was $48,000.” says Johnston. He goes on to ask, "...after 12 years of tax cut mania real hourly wages are now 6% lower than they were in 1972-1973. Hourly workers today make less than their counterparts 40 years ago. Where did it all go?"
According to Johnston, hold on to your seats, over 33% of that money went to just 16,000 households and about 95 cents of every dollar went to the top 1% while the 99% lost ground.
When Al Gore debated George Bush, he accused him of "funny math" and even used the line Bush's father used against Ronald Reagan, accusing Bush of using "voodoo economics". Bush laughed him off. He repeated the mantra of trickle down theory that when the rich get to keep more of their money, all boats are raised. (isn't it funny as we debate raising the minimum wage, the same argument doesn't work for regular folk. Why isn't it good for America for the middle class and poor to keep more money in their pockets?) Twelve years later it is clear by Johnston's analysis that tax cuts have become an albatross around the neck of most Americans and the only boats being raised are luxury yachts belonging to the 1%.
Tax cut mania trickled down from the feds to the states as well. The result is a loss in revenue necessitating cuts in most infrastructure projects resulting in a continuing degrading of roads, bridges and utility grids across the land. The prime example of this is the state of Kansas, where Republican governor Sam Brownback dramatically cut personal taxes promising on explosion in economic activity and new job growth. Brownback is now fighting for his political life as Kansas has had to take a butcher knife to the state school's budget and is running up debt as it borrows to cover the revenue shortfalls. The state is unable to fund road projects or repair bridges and faces an increasing deficit.
Americas electrical grid is being compared these days to that of a third world country. The loss of a few key pieces could shut down most, if not all, of the nation's ability to deliver electricity. (in Gaza electricity is only on four hours a day...Egypt maybe 8 hours...Iraq about 12 hours maybe) Civil engineers say thousands of bridges are in need of repair and the nation's interstate highway system is falling apart. (Congress can't even come up with the revenue for that) When asked about all of this, Washington, and regressives in particular, throw up their hands and bemoan the lack of money and site the rising deficit as the reason their hands are tied. (a deficit of their making to a great extent)
(In the master plan for education in California, the University of California system is supposed to be free to residents of the state. Today, as tuition increases year over year, that goal is lost due to cuts in state funds due to lack of revenue)
$6.6 Trillion is missing from the incomes of average, gum-chewing Americans while the rich continue to get richer. (in just the last few days, the Wall Street Journal is reporting how one hedge fund, in collusion with banks, avoided paying over $6 billion in taxes...one fund) In his new book, Thomas Picketty states the wealth of the 1% is approaching levels similar to the wealth enjoyed by French nobility just prior to the revolution. The gap between the rich and everyone else is the worst in this country since the Gilded Age at the turn of the 19th and 20th centuries.
Regressives are outraged and offended any time class is discussed or the gap between the rich and everyone else. To bring this up is to be a Marxist, Communist, Pinko symp and it's a direct assault on capitalism. Pope Francis, as well as his predecessor Pope John Paul II, both proclaimed free market capitalism to be immoral. The Pope says it puts too much power into the hands of the wealthy and puts everyone else at their mercy. Warren Buffet says there is a class war going on and his class is winning. Johnston's research, along with PInketty, shows Buffet is right. When you cut taxes for the 1%...when you tax investment income and carried interest differently than you do income generated by labor...when you create a code where a hedge fund can avoid $6 billion in taxes...when corporations are avoiding billions more in taxes by buying companies in other countries...when Mitt Romney can make over $50 million in one year but pay a tax rate of around 18% while middle class Americans are paying in the mid twenties range...when Wall Street creates more and more millionaires while Main Street is falling apart and behind, something is very wrong. The fact is this is not a mystery. We don't have to go looking for Professor Plum in the library with a candlestick. It's clear what has happened and the only question is when will the 99% force some balancing of the scales.