Brianna Myre-Wilensky: Country needs balance
October 24, 2008
Craig — To the editor:
We are so caught up in words like … gasp … “socialism” that I think we are losing our common sense. The new charge of the Republican Party is that Obama’s tax cuts for the middle class are “typical class warfare and socialist.” The Bush tax cuts were also a redistribution of wealth, if that’s how you choose to look at the tax system; they just favored the rich and redistributed wealth upwards.
An examination of the past eight years shows that the top 1 percent has become 15 percent richer and owns 90 percent of the nation’s wealth, while the rest of the nation has become poorer. The average CEO makes 250 times the average worker, that’s way more than in any other country (and I certainly wouldn’t say they work 250 times as hard or are 250 times smarter). We also have the highest rate for childhood poverty out of all of the developing nations, yet we also have the most billionaires.
But here’s the biggest problem: Capitalism doesn’t appear to work when there is such imbalance. When consumers don’t have the money to buy products, businesses can’t make profits (hence, corporations from GM to Yahoo have had horrible quarters).
This quote from Roosevelt’s fed chairman, Marriner S. Eccles, is a perfect analogy of capitalism losing when the people do, “As in a poker game when the chips are concentrated in fewer and fewer hands, the other fellows could stay in the game only by borrowing. When their credit ran out, the game stopped.”
Because the economy is driven by consumer spending, we have been encouraged to stay in the “game” by using credit. As a result, credit markets are frozen because they are over extended and people can’t pay back loans, which is collapsing banks and the stock market. Ironically, this imbalance has caused the loss of trillions of dollars and the most socialistic move in our country’s history: the $700 billion bailout.
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Also, how is the American dream, which is the right of all Americans, possible for those of us who can never get ahead because of high health care costs, energy costs, food costs, college expenses, etc., no matter how hard we work? I am not for socialism, nor am I for capitalism without regulation; but I am for “common sensilism.” A healthy country and economy requires balance.