Economics Ain’t Electricity

 

I was having a difficult time in a college physics course when we got to the ins and outs of how electricity works. Until then, all I understood about electricity was that if I wanted something to work, all I had to do was plug the cord in.

My roommate introduced me to the water analogy where I learned that water and electricity behaved pretty much the same way so long as I didn’t drop the radio into the bathtub. I won’t go into detail, but you can look it up.

In the 1980s, the Reagan administration tried to sell their tax cut bill by applying the same water analogy to economics when they introduced their “trickle-down theory.” They would enable the rich to get richer by giving them tax cuts, eliminating burdensome regulations that stifled business, and enacting legislation that would promote business and increase profits. In time, they said, this new wealth would—and here’s where the water analogy comes into play—trickle down to those at the bottom of the money chain.

There are several reasons why this analogy fails.

That small trickle begins as a tiny drop (consumer dollar) and combines with other tiny drops to become an exceptionally large body of water (Gross National Product). This remarkably large body of water then shrinks to but a trickle when water (money) is removed in abundance.

So, who takes it out?

This is where the second problem with the water analogy arises.

Imagine it is an extremely hot day, stifling hot if you are a poor worker in a construction crew or a migrant worker in a shade less strawberry field. Not so hot if you are a rich CEO in an air-conditioned office.

There is a glass of water and there are two people who want this glass of cool, cool water.

One is rich and powerful, and the other is not. I know what you’re thinking. Why would these two individuals even be in the same time zone much less close enough to be wanting the same contested glass of water? In the real world, they wouldn’t be, but fantasy is alive and well in the world of economics.

The rich and powerful individual doesn’t really need water but having it would be nice.

The not so rich and not so powerful individual really could use the glass of water because it’s hot out there.

Anyway, if the not so rich and virtually powerless individual were to receive the glass of precious water there is a good chance that he would share it because, in general, his group is more accustomed to sharing. They mostly have no choice and usually just want enough.

On the other hand, the rich and powerful usually want it all. An example of this is when in the 1980s the Hunt brothers, at the time three of the riches people in the world, tried to corner the silver market because, as any rich man will tell you, you can never have enough. Coincidently, you can never have enough is what the not so rich who just want enough will also tell you.

So, I think people can agree that the rich want it all. How else would millionaires become multi-millionaires and then billionaires and then multi-billionaires? For the last forty years, because the rich and powerful have friends in high places—put there with their money, these glasses of water have been going to the rich and powerful.

Let’s look at what happens to the water in that glass as it navigates its way down the money chain. Remember that in our analogy, water represents money. Where does that water go so that it might someday trickle into that stream where the not so rich and powerful individual might scoop out a measly handful to quench his thirst?

The rich man drinks the water and after his body has taken out all the good stuff, he pisses the bad water into his fancy toilet. He then flushes the toilet, sending that bad water into the sewage system where it meets up with other bad water and who knows what else. This now horrible water is treated at a water treatment plant and released back into the environment where it enters into the natural water cycle. It will eventually become part of the water supply that is purified and sent to a water tower and eventually delivered to our taps and into a glass where anyone might drink from it—assuming a rich and powerful person is not there to claim it first.

This process could take weeks, or it could take eons. The poor and powerless are used to waiting. What we know is that the trickle-down theory doesn’t hold water, at least not for those who aren’t rich and powerful.

But this is all theory. How has it worked out in the real world?

In 1950, after the Depression and World War, our economy was booming, and it was booming for everyone, workers and investors. The rich saw their tax rate decreased to 70% from a wartime high of 90%. They probably wanted more, but the middle class that this boom economy produced insured there would always be buyers for the goods they were producing.

There were roughly 17,000 millionaires in 1950 and two billionaires. By 1960, there were around 80,000 millionaires and the same two billionaires. The economy was working for everyone, but the rich thought they were getting the short end of the stick. They were still paying that 70% tax rate.

By 1980, the number of millionaires had grown to 500,000 and billionaires to thirteen. The middle class had also grown since the 1950s. But something happened when Reagan came into office. Air traffic controllers went on strike, and he used the opportunity to give the wealthy class what they thought was a well-deserved break. He fired the controllers and began working on legislation that would reroute money to the wealthy first, from where it would then trickle down to the working class.

In the next forty years, the number of millionaires would shoot up from 500,000 to 24 million, and the number of billionaires would go from 13 to over 900. The rich were getting richer rapidly while the poor and middle class became stagnant.

Of course, a million isn’t what it used to be.

What still is what it used to be is the minimum wage. In 1968 it was $1.60, or $14.42 in today’s economy, when taking inflation into account.

Today, it is $7.25, which obviously is $7.25 in today’s economy. So, worker’s wages have literally been cut in half while the number of billionaires has grown from 13 to 900.

I think it is safe to say that trickling down doesn’t work, neither theoretically nor realistically. The middle class that grew out of a government caring about workers is dying as government bends over backwards to give the rich even more money, because unfortunately, the water is drying up.

 

 

 

 

                               

Why do they need more money?

 

 GOP-led House approves Trump's big bill with trillions in tax breaks and Medicare cuts

 

Finally!

And I don't mean they passed the bill.

Those were my thoughts today when I pulled this month’s issue of New Republic from the mailbox and looked at the cover. Who needs that much money?

My question, which I had been trying for weeks to get into some paper’s OP-ED page, “Why do the rich need more money?” was slightly different from theirs. It was, however, a question that I thought needed to be asked, and answered, since all the cuts in the proposed budget bill would enable Congress to give the rich the tax cuts they desired.

Maybe it was a mistake opening with a Professor Corey skit from years ago, but I thought interjecting a little humor into an otherwise boring economic piece would be welcomed. Anyway, this is the question I've been asking and am still looking for an answer to.

 

* * *

Yes, but Why

 

Professor Corey, the world’s foremost authority on everything, had a skit where people asked him, “Why do you wear sneakers?”

“This is a two-part question,” he’d say, and go on to describe all the philosophical implications of the word Why. Then he’d answer the second part, “Do I wear sneakers?”

“Yes, I do.”

Congress is currently negotiating a trillion-dollar budget bill that if passed will cut numerous social programs designed to help the needy and less fortunate. The resulting savings I keep hearing will pay for tax cuts for the rich.

My question is, “Why do the rich need more money?”

Professor Corey wasn’t a member of Congress. If he were, and was working on a bill like this one, and was asked this question, he’d go into his convoluted explanation on the word why and then answer the second part, “Yes, they do.”

Will Rogers also wasn’t a member of Congress, and he didn’t think much of politicians. “With Congress,” he said, “every time they make a joke it’s a law, and every time they make a law it’s a joke.

But government isn’t a joke, or at least it shouldn’t be, although sometimes those in government seem to work damn hard at being a joke. While this bill if it passes might be considered a joke by many, its consequences are no laughing matter.

Serious questions are being posed about this bill and serious people are stepping up to answer them. Authorities from every field are explaining in detail why disadvantaged children need school lunches, why low-income folks need Medicaid to help with rising health costs, why scientists need grants to produce new vaccines and discover new cures for diseases, why the broken immigration system needs more judges, why we need less lead in our pipes and more and better water treatment plants, why social security needs to be stabilized not defunded, why college students do need assistance, why veterans have earned and do need better care, why people hit by natural disasters need all the help they can get, why agriculture and food-processing plants need more and better inspectors, why airports need more controllers and airplanes need to be made safer,  why foreign nations do need our assistance because when they do well we do well, why the arts are as necessary as arms, and why a whole host of other programs that are being threatened need to be funded because real people depend on them in so many ways. Most of all, our government needs people because problems don’t solve problems, people solve problems.

What I don’t hear is anyone explaining why the wealthy need more money.

They have found ways to legally reduce their tax bill. They have found ways to legally get around paying their taxes, often zero taxes on mindboggling wealth. When push came to shove, many resort to illegal means to get more money, and have enough wealth to avoid the consequences.

A key to their plan has been to use their money to acquire a louder voice in government. When the Supreme Court declared that their money was a legitimate voice, the game was over. The wealthy now do have the loudest voice in government and the representatives they have put in want to kill or weaken as many programs designed to help the needy as they can to pay for tax breaks for the wealthy.

So, my question to anyone in Congress, the president, or to any of the millionaires and billionaires whose money put these politicians in office is, “Why do the rich need more money?”

And the answer better not be a long dissertation on the word Why followed by a quick throwaway response, “Yes, they do.”

* * *

So, this is my answer to New Republic’s question: Who needs that much money? 

No one.

And the answer to my question: Why do the rich need more money?  

They Don’t.

I hope every voter in America is asking and answering these two questions and remember them when they vote in the 2026 and 2028 elections.

 

 

 

Tocqueville would be wary of Trump's overhaul of government

When a government, or for that matter, a corner grocery store, fires one employee for incompetence that is good management. When that government fires 5000 employees, without cause or the flimsiest of cause, that is targeted domestic terrorism. When it does so to many departments and agencies, that is bad government. It might possibly be a sign of worser things waiting down the road.

America has had its share of bad government. We've seen incompetence, corruption at times, and sometimes, leaders who just weren't up to the job. We've gone through periods when, because of the times we lived in, we as a nation behaved badly, and that was regrettable but was at least excusable.

So, the question becomes, as is always the case when dealing with bad: How bad can it get?

Alexis de Tocqueville answered the question in 1789 while observing the early days of the French Revolution. The monarchy of Louis XVI was clearly bad, and the citizens were obviously mad, but the eventual outcome could not have been sadder. The beheading of the king was not the reform France needed. Changing the calendar by making 1792, Year One also was not helpful, although most people seemed pleased in the short term.

The new governments, there were several, were created by well-intentioned revolutionists aware of what had taken place just a few years earlier in America. But there were more. There were radicals, activists, intellectuals, as well as common criminals, the usual power brokers, and always a mob lurking in the background.

Clearly, the government replacing the bad government(s) was itself a bad government.

Alexis de Tocqueville answered the question; how bad can it get? this way. "…the most dangerous moments for a bad government…is when they set about reform."

Trying to do too much, trying to change things too fast is difficult in any situation, but for a bad government, the results can be disastrous.

In just his first weeks, and in some cases first days, Trump has set out to reform what has taken us over two hundred years to accomplish.

Was it perfect? No.

Was it working? Yes.

Trump has set out to reform: the military—by deciding who can and cannot serve and who should lead those who serve; the Justice Department—by pardoning convicted criminals who attempted a coup and who threaten to do so again, while at the same time attacking prosecutors who prosecuted him for the crimes he committed; the Treasury—by firing IRS workers because he doesn't like to pay taxes; the Commerce Department—by enacting senseless tariffs because it makes him look tough; the Department of Health and Human Services—by replacing scientists and health specialists with non-medical partisan idealogues; by cutting off aid to needy countries; cozying up to foreign dictators while attacking our allies; by running roughshod over the media and attacking the freedom of the press; plus a lot of just plain stupid stuff like changing the name of the Gulf of Mexico to the Gulf of America, and suggesting we make Canada our 51^st state.

More is going on behind the scenes.

These are clearly the workings of a bad government trying to enact reform badly. Even worse, much of it seems to be done for publicity purposes to his base. Maybe de Tocqueville was right and the worst thing a bad government can be doing is making so many reforms so quickly.

After blaming Ukraine for Russia's invasion and calling Ukraine President Zelinski a dictator just a week ago, President Trump and Vice-president Vance behaved shamefully today in the Oval Office in a meeting that ended without the traditional joint press conference.

This wasn't US delegate Adlai Stevenson dressing down Russia at the U.N. during the Cuban Missile crisis. This wasn't President Reagan in Berlin saying, "Gorbachev, tear down this wall."

This was just a bad president and vice-president throwing an ally under the bus to please a Russian dictator thousands of miles away.

I don't know if this is what his supporters were looking for when they voted for him. Sadly, I think many of them are getting what they wanted.

I don't think America looked great today in the Oval Office. I think we are in for many more dangerous moments like what we witnessed today. This is what happens when we elect bad people who go on to form bad governments and expect them to do good things.

Alexis de Tocqueville warned us, but that was 200 years ago. Who pays attention to history?

 

This article appeared in the Baltimore Sun earlier this year. The problem has only gotten worse.

Ukraine-location, location, location, timing, timing, timing

 Realtors tell us it’s all about location, location, location.

They also tell us timing is everything.

Political analysts, I’m sure, would agree.

When my daughter was in college she became friends with a fellow student, who our family quaintly refers to as, Mary from Ukraine, to distinguish her from Mary from Princess Anne High School. Since graduating, they correspond regularly and have visited each other on several occasions in Ukraine, France, Morocco. The two are on similar journeys that began as college students and has continued as they’ve become single working girls, newlyweds and now with their own families.

Had either gone to another school or enrolled in different semesters they never would have met, and both would have missed what looks to be a lifelong friendship. Life certainly is all about timing and location.

That is what I told Mary’s father in my only correspondence with him. When Jessica returned from her visit to Ukraine she delivered a gift to me from him—a pewter glass holder. Before sending him a thank-you letter I researched the significance of the image portrayed on it.

It seems that in the 1600s, Poland was a powerful nation controlling much of Eastern Europe. The people of Ukraine resented living under what they considered to be a repressive regime, much the way a century later we would resent being under England’s thumb.

In 1648, under the leadership of Bogdan Khmelnitsky, Ukraine Cossacks successfully revolted and gained their independence from Poland, just as we would one day do from England. His image is the one on the glass holder. He was Ukraine’s George Washington before there even was a George Washington.

Ukraine wanted what the American colonies would later desire and they were willing to put everything on the line to gain their independence. Like the American colonies, they were successful. But unlike the American colonies, Ukraine was unable to sustain lasting independence, mostly because of its location and 1650stiming.

It was a different time and a different place. The politics of the day demanded they align with a bigger, stronger nation or risk falling back under Poland’s control. By the mid-1650s, Ukraine was under the protectorate of Tsarist Russia. In the end, their fight for independence had resulted in merely escaping the grasp of one European powerhouse only to fall into the repressive realm of another. Their alliance with Russia would, in the long run, prove more destructive than if they had remained with Poland.

In the first few years after our victory over England, we experienced many hardships of forming a new government, but our independence was never threatened. Again, timing and location made the difference.

As a nation, we had room to breathe. Our borders weren’t at risk.  Something else existed in 1776 America that did not exist in 1648 Ukraine—fresh ideas.

In the period between Ukraine’s revolt and the American Revolution, something happened. Something that changed the world.

John Locke was born in 1632 and in his lifetime, he would propose doctrines that would change the world and the way people thought about themselves. He, along with Rousseau, Voltaire and others would shape politics and the approach to governing.

Before these men, revolutions were about replacing repressive governments with similarly repressive ones. But the American Revolution was about revolutionary ideas like life, liberty, and the pursuit of happiness—ideas first put forward by John Locke. In 1648, Ukraine did not have these forward-thinking ideas as a resource.

That is what I wrote to Mary’s father when I thanked him for his gift. At the time Ukraine, like many other former Soviet states, had broken away from the Soviet Union and seemed to be making a move into mainstream Europe. But as we watch the pictures coming out of Independence Square in Kyiv, we realize the Ukrainian people are again at a crossroads and faced with the same problems it had in 1648—whether it will align with Europe and gain a greater degree of independence or return to being a Russian satellite.

This time it has the benefit of revolutionary ideas, but it must also overcome 400 years of Russian influence. The struggle is also being fought in an area of much unrest and turmoil and at a time when where they wind up will have major repercussions for all the nations involved.

No one knows where this current struggle will end, but again, as always, the times and the location will play a major role.  

This was written in 2014 at the time of Ukraine’s last struggle with Russia. Putin was Russia’s leader then and continues to be today, so again, Ukrainians find themselves at war with a man willing to destroy them in order to control them. Maybe now is the time and place to finally gain the independence they’ve been fighting four centuries for.

And now is the time for Bogdan Khmelnitsky to be replaced by Volodymyr Zelenskyy as Ukraine's latest hero in its fight for independence.

  

 

 

 

 

 

 

 

Legitimate Political Discourse

 

Stop shouting. I can barely hear myself think

People died, were injured, and/or were terrorized by all that “talking” that Republicans are now calling legitimate political discourse. Yelling “fire” in a movie theater is still wrong and not protected by the first amendment, but something that can get you killed is legitimate political discourse.

Can we now use the word deplorable to describe those who defecated on the floors and walls of the Capitol? For those who don’t like reading about sh*t in their morning newspaper, how would you feel about walking into your office tomorrow and finding sh*t on your desk next to your nameplate?

How does “Hang Mike Pence” even begin to equate with legitimate political discourse like “I don’t think I can vote for that?” Don’t even try to write it off by declaring “Democrats say nasty things, too.” Trump blew that defense out of the water by declaring there were good and bad people on both sides in Charlottesville. Nazis? White supremacists? Good people?

How does “We have to fight like hell” not be a call for violence when the resulting action becomes a violent, no-holds-barred, inflict-as-much-pain-as-possible insurrection?

Republican leaders continue to defend the big lie. They think the only good Americans are Republicans in good standing. What should we expect from a party always demanding loyalty oaths?

Trump, who speaks for all Republicans—at least the good ones (sorry Pence), call Democrats un-American traitors? No Republican said this was wrong. Even “Some Democrats are un-American traitors, and some are not,” would have been a step in the right direction.

Republicans continue to defend the “big lie” because they are, and have been for some time, big liars, tying themselves up in knots trying to explain their behavior. They stand by a man who says, “…if we don’t stand up and fight, we will lose our country,” when this same man is literally destroying our country.

How deplorable must a Republican leader be to cower to this immature coward? How deplorable must voters be to support these leaders?  

Ask someone who says, “I’d rather die than get vaccinated.”

Giving Ideas a Voice & Room to Grow

 

These are front and back covers of book I'm currently working on.

Now they are Deplorable

As a Democrat, I have to say I’m getting a little tired of the constant criticism that Republican leaders are being subjected to, for simply being Republican leaders. This goes for everyone from Trump to Cruz and McConnell, Rubio and Hawley, Ron Johnson, the ever-ridiculous Louie Gohmert, and a whole lot more.

True, they are all hypocrites, clueless and idealess, which is a whole lot more problematic than being an idealist. They stand for nothing other than self-preservation in a dog-eat-dog world of politics, which is why it has become easier than it’s ever been to make fun of them or box them into a corner by throwing their own words back at them.

Nevertheless, ridiculing Republican leaders has become all too easy, because they are simply doing the only thing they feel they must do to hang on to their jobs—appeal to Republican voters by being loyal Republicans. They are wrong of course. They could be leaders, but leadership is not what Republican voters look for in their leaders. Trump won in 2016 because he said what Republican voters wanted to hear, not what they needed to hear.

For this reason, while media fatigue has allowed me to let Republican leaders off the hook, and because they deserve our pity more than our scorn, I am disgusted with Republican voters. Not just because more  of them seem to be white supremacist, racists, bigots, religious fanatics, law-and-order enthusiast who don’t respect the law, Constitutionalist who don’t respect the Constitution, and in many cases, may not have ever read the Constitution, or just plain folks who simply don’t care about anyone other than themselves.

I’m disgusted with them because they just don’t seem to be that smart.

I’ve listened to QAnon conspiracist rationalize why they supported and continue to support Trump and it’s mind-boggling—not only for what they think they know, but what they honestly don’t know, and make no mistake, QAnon conspiracist vote Republican.

So do a lot of other crazies—Proud Boys, boogaloo boys, that old standby KKK, those people who think masks aren’t necessary, or the ones who think guns are not only necessary but vital to our survival.

Too many of these not-so-smart Republicans think a debate on healthcare or wages or the economy or politics can be won by throwing out the words Socialism, traitor, un-American, fake news, Soros and lately Hunter.

They are so ill-informed, and willingly so, that Republicans were able to run in the last election on a platform completely devoid of ideas or policies, other than, we’ll do whatever Donald Trump wants us to do. This was the Republican platform and 74 million Republican voters said, “Sounds good to me.”

When Hillary Clinton declared Trump supporters were deplorable, and was rightfully called on it, she immediately apologized and admitted that not all of the 60 million people who voted for Trump in 2016 were deplorable, only many of them. Of course, she was talking about the white supremacists, bigots, racists, fanatics, conspiracist and extremists, but not every Republican voter fell into these categories.

Some were just lifelong Republicans, probably born and raised in Republican households, just as many Democrats are lifelong Democrats born and raised in Democratic households.

Close elections are generally not won or lost by these voters, but rather by those in the middle who tend to lean one way or the other depending on the year, the issues, or the candidates.

For any number of reasons, 60 million voters chose Trump in 2016, and while they were not a majority, they were strategically well placed to secure an Electoral College win for who turned out to be, the worst president ever.

Twenty-twenty was a different ballgame entirely. Democrats picked up 17 million votes, which wasn’t surprising considering Trump had spent four years bashing Democrats as Socialists and un-American traitors.

What was surprising, was Trump picking up 14 million more votes after a presidency that should have only pleased James Buchanan, a presidency that included a public love-fest with a Korean dictator and murderer, a tax law that benefitted millionaires and billionaires and very few middle class Republicans, two impeachments and the groundwork for numerous lawsuits once he left office. There was also a wall that Mexico never paid for because it was never built, an immigration policy that separated hundreds of children from their families, and a response to a world-wide pandemic that was disastrous for the nation and fatal to 500,000 and counting Americans.  

The events of January 6, 2021, as well as Trump’s behavior in the two months after the election, only solidified for me that Trump is not qualified to be president, and yet, he appears to have lost little support among his base. Seventy-four million Americans voted for Trump in 2020, after a presidency that gave him a leg up in the race for worst president ever. I shudder to think what those voters saw in Trump’s presidency that made them want to go down that road again.

The devotion of Republican politicians to Trump was evidenced recently by their behavior at CPAC, where they publicly proclaimed what we all knew they were doing privately—pledge their allegiance before a cartoonish golden Trump mannequin. I don’t expect them to behave any differently than they do. I’d like to think they answer to the Constitution, but I’m not naïve. They only answer to voters, Trump voters.

Again, maybe not all of those voters are deplorable. It’s possible that some might just be foolish, but the fourteen million new Trump voters, if they had been paying attention—and how could they not have been paying attention—surely they are deplorable.

No one in their right mind could have witnessed the last four years, listened to Trump speak, read about his missteps—no not missteps, but rather crimes since even Republicans attest to his guilt—and not realize that he is a dictatorial demigod, and totally unfit to be president.

As sensible, thinking Republican voters continue to jump ship, making the party less sustainable than a Trump casino, Republican leaders are not the problem so much as Trump voters, the deplorable ones are, and they are not just a problem for the Republican Party, but for the nation.