|As American anxiety builds, London calling|
|Wednesday, 17 August 2011 17:13|
by Brian Howey
NASHVILLE, Ind. - It was fascinating to watch the "Arab Spring" go viral over the Internet last winter, from Tunisia to Egypt, Bahrain, Jordan and Syria. This is the reality of the interconnected world we live in.
This past week, we've witnessed something our parents and grandparents did: London is burning.
The spark that ignited riots in London was a police shooting. But at this writing, the rioting had spread to Birmingham, Manchester, Liverpool and Bristol. The shooting was a mere trigger in Britain, which underwent an austerity program well before the Tea Party forged a Republican takeover of the U.S. House last November.
We've witnessed this in Athens, where the corrupt Greek government tried to rein in spending and was met by riots. There have been massive protests over cost of living, pension cuts and corruption in Spain, the Philippines, Israel and even China.
America, these are shots across our bow.
We are mired in a jobless rate hovering around 9.1 percent. In Indiana, it has been above 8 percent since 2009 and there appears to be no light at the end of this tunnel. Experts say these figures don't truly reflect the jobless rate which would include people too discouraged to look for work anymore. Others have slipped into the underground economy, selling drugs, doing construction work and other day jobs for cash, and a myriad of off-the-books commerce as they try to survive.
And I'll remind you of a statistic the Washington Post reported earlier this summer: the top .1 percent of Americans earn 10 percent of all income, and the top 1 percent earn 20 percent.
Folks, this income disparity is as unsustainable as this nation's balance books.
Since President Obama took office in January 2009 and the GOP lash back of 2010, the message from this writer has been the same: Government needs to be doing all it can to create jobs.
Some, like U.S. Sen. Dick Lugar, are advocating a thorough reworking of our federal tax code - the Fair Tax - which would create the greatest incentive in the world for job creation to take place here and not in violent Mexico or authoritarian China.
“The current tax code warps household and business decisions, discourages investment, is constantly evaded, is arduous to enforce, and is disconnected from the need to stimulate growth, savings and investment in our economy,” Lugar explained.
He strongly believes, “Without strong growth, new jobs are not created, wages are not increased and wealth for all Americans will not grow.”
Sponsored by U.S. Sen. Saxby Chambliss (R-Ga.), The FairTax Act (HR 25, S 13) abolishes all federal personal and corporate income taxes, gift, estate, capital gains, alternative minimum, Social Security, Medicare, and self-employment taxes and replaces them with one simple, visible, federal retail sales tax administered primarily by existing state sales tax authorities.
The danger today is that the Republican/Tea Party emphasis is about cutting debt and deficits. To its credit, the Tea Party movement has elevated this true national threat to the forefront of debate. The problem is that they want to do it by just cutting government spending. Over the past year, 340,000 state and local government jobs have been eliminated. Federal government employment has been mostly flat; 3.1 million in 1992 to 2.8 million in 2010.
This past week, Congress created a new Super Committee (officially named the Joint Select Committee on Deficit Reduction) to determine how America can live within its means. According to a CNN/Opinion Research Poll released last Tuesday, 62 percent think taxes on the wealthy should be hiked so the government can fund programs that help lower-income Americans. Just 34 percent said taxes should be kept low for the wealthy because they help create jobs. Just 35 percent think the Super Committee should propose significant changes to Social Security and Medicare.
During the debt ceiling debate, poll after poll showed Americans favoring a mix of tax hikes and spending cuts. But it is hard to find a House Republican who even wanted to close tax loopholes to raise more revenue. When President Obama finally signed the debt ceiling bill into law, House Speaker John Boehner bragged that he got "98 percent" of what Republicans wanted. This was greeted by Standard & Poor's historic downgrade of U.S. credit on Aug. 5.
S&P is hardly a font of credibility, having missed the 2007-08 mortgage bubble fiasco (as well as the fall of Lehman Brothers). But as flawed as S&P is, there is more than a kernel of truth when it explained, "The downgrade reflects our view that the effectiveness, stability, and predictability of American policymaking and political institutions have weakened at a time of ongoing fiscal and economic challenge.”
In the wake of the debt ceiling and subsequent downgrade, we've watched President Obama's approve/disapprove sag to 41/51 percent in Gallup polling, and a record low 21 percent say Congress should not be reelected. The CNN/Opinion Research Poll found the approve/disapprove of the Republican Party at 33/59 percent, and the Tea Party stands at a dismal 31/51 percent.
And what I fear now, during these dog days of August, is the anxiety moving from the family kitchen table and into the streets of America. If you don't believe it, London is calling.