Blogs » Politcs Plus » My Weekend History Lesson



We had a small but a Happy Thanksgiving which allowed me to watch a documentary I had recorded and read some books that I have been ignoring. If you want to understand what's happening today, I suggest you watch the 5 1/2 hour PBS’s documentary called "Prohibition." The 18th amendment (Prohibition) was a great example of government overreach and a lesson to all, that you cannot legislate morality. The majority ignored prohibition and it was exploited by the minority. Farmers, merchants, and gangsters became bootleggers while politicians and law enforcement became enablers. The documentary was more about life lessons, than it was about the illegal consumption or the selling of alcoholic beverages. It reminded me of the hyper-partisanship we are in today, where the fight is more important than the issue. Back then the dries (a reformer who was for the 18th amendment) usually started their meetings with the serving of alcohol. On the other side, some of the wets (proponents of repealing the 18th amendment) were teetotalers. Like today, it became a wedge issue and very political. For example, it wasn't that long ago when the indivual mandate and Cap-and- Trade were conservative ideas. President’s Nixon's health care plan was to the left of today’s Affordable Health Care Act. In fact the top two contenders for president in the GOP have had similar stances on health care as the current president. I can see the confusion in the GOP debates, where Perry, Cain, and Romney are struggling to find the answer; they think the audience wants to hear. Newt Gingrich proved that by going further than Rick Perry on illegal immigration, but he didn't apologize for it, nor did he suffer in the polls for it.

I read an article in the New York Times by Jeffrey Sachs called “The New Progressive Movement" where he said historians point out that politics moves in long swings. We are at the end of 30 years Reagan's era which the top 1% did quite well with favorable tax policies. President Reagan ushered in his new era with his renowned slogan that is being revived by today's Republicans” Government is not the solution to your problem. Government is the problem." Taxes on the rich were quickly slashed as well as outlays on public services and investment as a share of national income. Only the military, Medicare, Social Security, Security, Medicaid, and veterans benefits survived the cuts. If it weren't for politics, the latter would have suffered the same fate because the ultimate goal is total privatization.

Reagan’s policies left us unprepared to face the rise of global competition in the information age. We still don't have policies in place to face global competition, energy, and environmental challenges of today or tomorrow.

Both parties have joined in crippling the government by listening to their wealthy donors who demand that their taxes be kept low on their capital gains, and estate and corporate profits. We have seen this picture before (1929 Great Depression & Gilded Age) where powerful corporate interests dominated Washington, and America was left with unacceptable inequality, instability and corruption. Both times it took social and political movements to restore democracy and shared prosperity.

The first age of inequality was the Gilded Age at the end of the 19th century in 1893. That era came after the financial crisis of 1893. It was quite similar to what we have today, where both parties catered to the interest of their wealthy contributors, who were then known as the corporate robber barons. It took Theodore Roosevelt and Woodrow Wilson decades to come up with reforms such as trust busting, federal income taxation, fair labor standards, and direct elections of senators and women's suffrage.

Then came the Roaring Twenties with the pro-business administrations of Harding, Coolidge and Hoover. Once again, again the wealth accumulated at the top, leaving no one able to buy the goods necessary to sustain the economy. Then by popular demand, FDR was elected and marked the start of reduced income inequality, strong trade unions, steep top tax rates, and strict financial regulations.

I don't completely agree with Jeffery Sachs, when he says, Occupy Wall Street and similar movements in 1000 cities across the nation is the beginning of reform, because, unless they are registering to vote with the intention of supplanting the 112th Congress; their movement will die a slow death. They may get small concessions like lower tuition rates and some job incentive bills but little else.

I do agree that the message has to come from somewhere else other, than the mainstream media because they concentrated on ratings rather than informing the public. This weekend, the talk shows were about who was a big winner in the failure of the Super Committee to come up with a deficit-reduction plan. The commentators asked the Democrats " the president did not get involved in the recent Super Committee; isn't that a lack of leadership?" I'm pretty sure pundits do their homework and know that both parties wanted the White House to stay out of negotiations because it would further polarize the decision-making, but they had to throw out that “leadership" comment to try to make some news. I may be wrong because the president holds his cards close to his vest, but I think the GOP is playing right into Obama's hand. The GOP has taken their own baby (no tax pledge) as a hostage, and if they continue with this strategy of no new taxes, the president can refuse all proposals (that does not have revenues) then on December 31, 2012 the Bush Tax cuts will expire. The American people have already seen the presidential candidates refuse $10 in tax cuts for $1 in revenues. It won't be that hard to paint the opposition as being unreasonable. They certainly can't preach about deficit cutting when their expert on the subject, Representative Paul Ryan, voted for two wars and a medical prescription-drug bill that was not paid for.

This week we will see if the GOP will pass to extend the payroll tax cuts and unemployment benefits. The GOP does not like the 2% surcharge on the top 2% plan the democrats have come up with, but Senator Kyl tried to make a pundit believe the 4.2 % Social Security rate (6.2% is the normal rate) will take money out the trust fund even thou he knows that is not true.

History tells us that we been in this situation before, so we know we know how to get out of this situation but this time it will take us a little longer because we don’t have the manufacturing jobs we once had and our trading partners are having a financial crisis of their own. We won’t suffer the same fate as Portugal and Greece because they don’t have any say so, in their monetary rate because their currency is based on the Euro. You cannot compare their credit history to ours, that’s the reason they are paying the higher interest rate. History also tells us that a small percentage of people were ranting about Medicare calling it “socialize medicine” Most importantly the CBO just revived their current report saying that “The economy would have been in much worse shape without the 2009 stimulus — which increased employment in the third quarter of this year by as many as 3.3 million full-time jobs.