American Economics is like a snake that is swallowing its own tail

For the past 30+ years, since Ronald Reagan, aka the “great communicator”, sold “Reagon-onmics” to the American people, the economic system has been depressing the middle class redistributing wealth to the upper class.

If this was actually a valid economic model, the upper class would immediately open new businesses increasing their wealth and creating new jobs eliminating unemployment. The upper class did not get rich by being stupid. Without a customer base with money to spend, there is little opportunity for new business creation.

Huge tax breaks for the upper class has shifted the tax burden onto the middle class.  The middle class Americans, 80% of America, are the customers that drive the demand and create business opportunities in America. Since no business can prosper without customers, America has drifted from one recession to the next as the private sector opportunities shrink.

This is like a snake swallowing its own tail.

The rubber stamp response to recession has been to grow the size of government creating new government jobs to make up for the lagging of private sector growth. Ronald Reagan, George H. Bush, Bill Clinton, and GW Bush all increased the size of Government while American Business opportunities became fewer and farther between. The result is a growth from 17 million federal employees to 22.5 million federal employees in just 28 years.

This is an increase of 32% in the size of government in 28 years.

This is like a snake swallowing its own tail.

Barrack Obama together with a democratic congress passed stimulus that put all recovery effort in the private sector and reduced the size of government for the first time in modern history. To further create business opportunities Obama proposes shifting the tax burden back to the upper class, leaving American business’s customer base more money to spend and create more business opportunities.

To further create business opportunities Obama now calls for a raise in the national minimum wage. The $9 per hour proposal would raise a two income household of four almost to the poverty level reducing the need for government housing and food subsidies. At this level of income, every dime made is immediately spent stimulating business.

Tax breaks for the upper class simply grow off shore tax sheltered bank accounts and do nothing for the commonwealth.

We can always fight about money. It matters not how much or how little we have we can always fight about what to do with it. America is the richest nation on earth. There is no reason for poverty, hunger, sickness, poor education, and depressed business opportunity other than we choose it to be so.

Categories: Economics, Politics | Tags: , , , , , , , , | 1 Comment

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One thought on “American Economics is like a snake that is swallowing its own tail

  1. Pingback: Boehner contines to hold fast to the Romney plan. | Angus Croix

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