Tag Archives: trickle-down

88. Ask Trump: Which Regulations?

31 Jan

Donald Trump has said it is urgent to abolish as many federal government regulations as possible (subject to certain limitations). This may sound OK to ordinary citizens, but if you study the details, you will quickly see why Trump is not more specific. The one specific law that he would terminate is the “Dodd-Frank Wall Street Reform and Consumer Protection Act”. He never uses the full name, because this act provides Wall Street reform and consumer (you and me) protection. Abolishing the act takes away our protections and allows banks and investment houses leeway to make more profits at our expense. When major banks and other corporations failed in 2008, you and me (the taxpayers) spent our money in saving them. And, to add insult to injury, many of the offending executives got bonuses that year. So it is the old story, rich Mr. Trump is recklessly increasing profits for his wealthy friends, and you and I will, in some way, pay for it; just like we will have to pay for his “Mexican Wall”.

The reason why all this is possible, is that corporations protect individuals from losses due to reckless actions. A corporation can go bankrupt and take the blame, while the executives escape unharmed. And, rich donors lobby congressmen to provide laws that help them financially. Note that Hillary Clinton supported this protective act.

We can only speculate as to what other regulations Trump wants to remove. He has created a rule that is absurd and harmful: that for every new regulation, two must be abolished. Good government is not a game where you ignore the consequences of what you do — it is serious business that affects people’s lives. Historically, thousands (even millions) have died for improper regulation of pesticides (like DDT), improper testing of drugs (like Thalidomide that harmed babies) and various kinds of pollution and toxins (like lead in the water).

Regulations also protect us from financial trickery designed to increase profits for corporate executives. Currently, when you get a mortgage, other type of loan, credit card, annuity, etc., you can be reasonably certain that you are safe. If the regulation of financial transactions is abolished you might have to hire a lawyer to deal with these, or risk major losses. Our world has become more and more complicated and the citizens will need more protections, not less.

Trump and most Republicans would argue that abolishing regulations, lowering taxes for corporations and wealthy people, etc., will improve our economy and the positive results will “trickle down” and help us ordinary citizens.  Why is it that every such plan starts with making rich people richer, and the middle class can only hope for some trickle down. Don’t be fooled. For many years the royalty class has prospered, but the promised middle-class benefits have not been received.

48. Morning Joe “Trickles Up”

8 Mar

I was about to totally condemn Joe S. when I did some research and now I have to mitigate the criticism. I am retired and often stay up late at night. So late, that I often watch the early political show “Morning Joe”. This morning I decided to denounce Joe for his advocacy of torture and for his overly aggressive interaction with a female guest. His badgering reminded me of O’Reilly who is a master at suppressing his guests with fast, loud talk.  [Added later:  I changed my mind about Joe’s badgering, when on March 15, he made a gallant defense of Hilary Clinton’s record.]

That would be that, but as I did some research on Joe S., I discovered to my amazement that he condemned “trickle-down” economy, which is advocated (in a subtle way) by the vast majority of Republican leaders. This approach, also called “supply side” economics, says that the way to support non-rich citizens is to give more money to rich people and corporations. This extra money to the rich will make stronger corporations and promote hiring and better wages for the workers. In actual practice, however, this does not happen, and the rich simply enjoy the extra money. Instead of supply-side economics, Democrats tend to advocate a “demand-side” economy. If wages are raised, there will be more spending and the “demand” for goods will increase. Increased demand will promote production and hence economic growth.

For a few decades, now, we have had “supply-side” economics because more and more money has been diverted to the rich.  And everyone accepts the finding that income has substantially increased for rich folks, while for others, income has been stagnant. Every published budget by the GOP candidates has included lower taxes for rich people. In previous blogs I have presented more details.