Economics 101

Today we should talk about something that should be obvious to all Americans. Bush and the Republicans are continuing to try and widen the class gap in this country, and Alan Greenspan is a complete tool.

There are two issues. Taxes and bankruptcy. In both cases, the lower and middle class are getting shafted.

I swear, Americans are like Jews for Hitler. It's not in our best interest to have Bush, or any Republicans for that matter, in power, but they keep voting for them anyway.

I'm upset about this because I care about the welfare of others, and these policies are continuing to drive the divisions in this country. I'd prefer to avoid class warfare, but if this keeps up much longer, I wouldn't be surprised to see it become a serious danger.

Anyway, lets look at Paul Krugman's take on taxes, the economy, and Fed Reserve Chairman Alan Greenspan. Editorial here:

Four years ago, Alan Greenspan urged Congress to cut taxes, asserting that the federal government was in imminent danger of paying off too much debt. On Wednesday the Fed chairman warned Congress of the opposite fiscal danger: he asserted that there would be large budget deficits for the foreseeable future, leading to an unsustainable rise in federal debt. But he counseled against reversing the tax cuts, calling instead for cuts in Social Security, Medicare and Medicaid.
Does anyone still take Mr. Greenspan's pose as a nonpartisan font of wisdom seriously? When Mr. Greenspan made his contorted argument for tax cuts back in 2001, his reputation made it hard for many observers to admit the obvious: he was mainly looking for some way to do the Bush administration a political favor. But there's no reason to be taken in by his equally weak, contorted argument against reversing those cuts today.

. . . Until the 1970's conservatives tended to be open about their disdain for Social Security and Medicare. But honesty was bad politics, because voters value those programs. So conservative intellectuals proposed a bait-and-switch strategy: First, advocate tax cuts, using whatever tactics you think may work - supply-side economics, inflated budget projections, whatever. Then use the resulting deficits to argue for slashing government spending.

And that's the story of the last four years. In 2001, President Bush and Mr. Greenspan justified tax cuts with sunny predictions that the budget would remain comfortably in surplus. But Mr. Bush's advisers knew that the tax cuts would probably cause budget problems, and welcomed the prospect. In fact, Mr. Bush celebrated the budget's initial slide into deficit. In the summer of 2001 he called plunging federal revenue "incredibly positive news" because it would "put a straitjacket" on federal spending.

To keep that straitjacket on, however, those who sold tax cuts with the assurance that they were easily affordable must convince the public that the cuts can't be reversed now that those assurances have proved false. And Mr. Greenspan has once again tried to come to the president's aid, insisting this week that we should deal with deficits "primarily, if not wholly," by slashing Social Security and Medicare because tax increases would "pose significant risks to economic growth." Really? America prospered for half a century under a level of federal taxes higher than the one we face today. According to the administration's own estimates, Mr. Bush's second term will see the lowest tax take as a percentage of G.D.P. since the Truman administration. And don't forget that President Clinton's 1993 tax increase ushered in an economic boom. Why, exactly, are tax increases out of the question?

It's pretty simple isn't it? American's bought the whole Bush tax cut scheme because they thought it would put more money in their pocket. But, we see that Bush's Social Security privatization plans are going down the drain. American's want it both ways. We want tax cuts, but don't touch entitlement programs. You can't have it both ways.

The good news is that Hillarly Clinton really is coming on strong for the Democratic nominee in '08. Like Bill Clintion, I think we'll see some sound fiscal policies where government pays for what it spends instead of wracking up huge debt owned by foreigners. Is that going to require a tax increase? You bet - by rolling back the Bush tax cuts, and getting federal spending under control. I'm not talking about federal entitlement spending. I'm talking about spending such as the billions spent on things like missile defense, which simply do not work.

The bigger issue is - isn't this all painfully obvious?

The other issue is the Republican attempt to restructure the bankruptcy laws. It really is ridiculous. Basically, they want to be able to take your house away from you, where it was protected before. They want to keep you responsible for credit card debt, where you were not responsible before. Basically, they want to do away with bankruptcy as a concept, leave you penniless, and boot you out on to the street.

I'm not kidding. The fact is, most bankruptcies result due to health care debt. It's not that a person refuses to get a job. But, regardless of how it happens, Bush and the Republican's want you to be homeless. The scary thing is, this is likely to pass Congress.

The New York Times reports "legal specialists say the proposed law leaves open an increasingly popular loophole that lets wealthy people protect substantial assets from creditors even after filing for bankruptcy."

Imagine that. Do you have any outrage in you?