Rand Paul, as his father, make an odd footnote in the history of the Republican Party. The Republican Party is fond of acquiring token representations of its ‘new face’ exemplified in their analysis of why they lost the last election to President Obama. They understand the need for good public relations. After all, they have been weaving the ‘we are the working class heroes’ tale for many years. They are really good at it. The Paul’s offer the Republican Party the opportunity to capture some of the conservative, libertarian leaning folks. So, let’s take a look at Rand Paul.

Rand and his father were both huge fans of Ayn Rand and of the Objectivist philosophy. As a philosophy Objectivism is not well respected among serious philosophers. Their philosophical exegesis of great philosophers tend to be shallow and more opportunistic than penetrating. Ayn Rand wrote fiction books which highlight elitist views with its necessary accompanying condition of the lowly, uneducated masses. Her books favor a social Darwinism where the strong, the bright and the wealthy are the masters and creators of human destiny and the huge rest of the masses are simply cattle for herding and feeding off of. The elitists are the survivors of the fittest. The masses are simply failed genetics which are condemned by their own tragic inadequacies.

The Paul’s were also fans of the Austrian School of Economics which I have written at length about on this site. The Austrian School is the economic equivalent of the Objectivist philosophy. They are pure and fundamental ‘free marketers’. They believe the problem with the market has always been the government. They think that left totally to its own the free market will solve all the problems we thought we needed governments for. Whenever the government intervenes in the market, the market fails to work to its fullest and results in all the booms and busts of market history. They think government intervention resulted in the Great Depression not free market, unregulated banking and stock market failures as most economists believe. The think monopolies are the result of government intervention and corporatism where corporations buy off the government for the dreaded market regulation. Market regulation is a free market enemy because it deforms the natural workings of the market and gives companies a protectionist strategy that the market left to its own would not provide.

The Austrian School is a reductionist philosophy which accounts for market dynamics as a kind of zero sum game albeit not about wealth creation but about market dynamics. The purist school of Austrian Economics start from the assumption that the market, free of government intervention, will always be the best and most efficient delivery of goods and services in the long run. Any government intervention will ‘gum up the works’ and proportionally destroy the markets effectively. In this sense, the zero sum dichotomy at work is the absolute poles of free, unregulated market and encumbered, regulated government intervention. There is absolutely no middle ground for the purists. There is no daylight between government regulation and market degradation. The more the government intervenes in the market the more the market fails. This is a zero sum game. Regulation can never be thought as aiding the market. So, for example, if planes crash because of poor maintenance, the FAA is not the answer. The market is the answer. Folks will not fly with airline companies whose planes crash. The market will reward the company whose planes do not crash and punish the company whose planes crash. Eventually, the market will fix its own problems left to its own workings (just hope you are not flying in the meantime). Intervention by a government agency like the FAA will degrade the ability of the market to police itself.

The zero sum game played by the Austrians is really a thin veneer for survival of the fittest. Those that survive and thrive in the unregulated market get to establish their dominance. Those that fail in the market fall into the trash heap of wannabes. Of course, the Austrians would never say this. Their line concerning the ‘less fortunate’ is that the market will decide their fate. They think whatever happens with human failures of the market will eventually be corrected by the market. Although the Austrians would rather leave the ultimate outcome of their ideal unaddressed, it could be a place at the table for everyone in the long run but more likely human tragedies and failures are swept under the old proverbial rug as Austrians cannot address the conditions for human tragedy except by the faith of the market. They could never acknowledge that the market, free of government intervention, could result in an elitist economy that is simply the latest face of tragic human history.

The Paul’s are students and advocates for these ideologies. The Republican Party fits very well with these concepts. The Party has convinced folks that their problem is not the market but the government. All the while the rich get richer and the poor get poorer. The faithful just turn this reality back on the government. They blame the government for these inequities. Regular folks are feed a steady diet of this dogma to the point where they cannot think that maybe the free, unregulated market could be part of the problem. This fictitious production does play into the power broker hands of the Republican Party. However, the Republican Party will never allow a Ron or Rand Paul be more than a token gesture.

The Pauls attract social libertarians even though they personally advocate for anti-abortion groups and favors laws to vastly restrict abortion. The Pauls are also against same sex marriage. Rand Paul is not in favor of government anti-discrimination laws. He thinks the market should decide. Business should not be hindered by anti-discrimination laws. He has also supported laws to protect ‘religious freedoms’. The Pauls tend to be non-interventionists when it comes to foreign affairs and aid but they still have strong affiliations to Israel. While the Pauls have some positions that seem to contradict civil libertarian ideologies, they have many positions which certainly give lip service to a libertarian ideology. However, what one must not forget is that they are not running independently. Their campaigns are bought and paid for by the Republican Party. Therefore, they have indebtedness to the Party that I suspect is probably partly responsible for some of their deviations from a strict libertarian ideology.

The Republican Party has too much interest in social conservatives to ever let the Pauls get too close to winning a presidential bid. The Party is all too happy to display adherence to diversity but when push comes to shove Rand Paul will never get the nomination just as his dad before him. Rand Paul will follow the Party line and would never run as an independent. His willingness to shift his positions to placate the Republican Party is troublesome. If he ever were president I think he would cave to party pressure and be more likely than he pretends now to engage in military campaigns and foreign aid. Admittedly, these are simply my concerns not anything factual. What I find more troublesome is his alliances with Ayn Rand and Austrian Economics.

I do think that Rand Paul would dismantle the government to the point of dangerous economic consequences. Ron Paul has written extensively about how he believes the Federal Reserve is corrupt and unconstitutional (See End The Fed). Of course, he would expect the free market to fill the gap and do a better job. Anyone that thinks this should check out this site before locking in a vote for Rand Paul. Check out the facts detailed on this site before blatantly deciding that the government is mostly dispensable. Most people are totally unaware of what the government does for them every day. Anyone who is willing to think about this rationally will inevitably have concerns about whether and how the free market could effectively address vital concerns that the government currently addresses. Rand Paul would, at the least, be a huge gamble that this unfettered, free market ideology would and could fill the gap right away.

Towards the end of the Great Depression the Fed was given much more power to stabilize the economy. Take a look at these graphs which show the effects of the Feds market intervention beginning in the 40s. While I did not graph the detrimental effects of GDP, unemployment and inflation before 1917 (that data is harder to find but is well known), it was even more erratic with many more severe depressions. These early years of our country would have been the ugly reality of what an Austrian Economy would look like with the gold standard and almost no regulation. However, instead of the most efficient utilization of goods and services we actually saw widespread poverty, early death and mass subsistence as a quality of life. Anyone that would vote for Rand Paul would have to think if they are really willing to take the chance of a Mad Max type existence. If the unfettered free market would have worked so greatly it would have worked in the first hundred years or so of our country. This Austrian style ideology became a free for all that resulted in a bought and paid for government in the Gilded Age at the expense of the majority of the country. Of course, the Austrians would blame the government for this but anyone with common sense will recognize that when big money is given carte blanche to do as it pleases, it will create a corrupt government if one does not exist. The Republican Party is smart enough to know that a Rand Paul type figure could never get elected president. They know that their benefactors do better when they keep a low profile as their prize victory, Citizens United, clearly demonstrates.

The following is the gist of what Senator Cory Gardner had to say responding to the email I sent him about the nuclear talks with Iran:

“This framework, based on details released thus far, appears to leave vast portions of Iran’s nuclear infrastructure intact despite their continued sponsoring of terror, and would expire in as few as ten years, allowing Iran to build nuclear weapons unrestricted. The American people, through their representatives in Congress, should be provided the opportunity to reject any deal that does not completely eliminate the threat of a nuclear Iran. I am also concerned that the current deal ignores other state-sanctioned terror activity Iran is pursuing.” Senator Cory Gardner

To “completely eliminate the threat of a nuclear Iran” is a fine and lofty goal but diplomacy is all about what is possible not what is ideal. What I pointed out to him in my initial email was that war is always an option regardless of any previous treaties. I cannot understand why, if there is a possibility for a treaty to monitor and restrict Iran’s ability to develop a nuclear weapon, why wouldn’t we try? Military experts have made it clear that even if we bomb Iran we will at most delay their nuclear development by a couple years. Isn’t ten years better than two years which is in effect the Cory Gardner default plan? Iran is within a year of developing a bomb if we pursue Senator Gardner’s ambitions. He and everyone that voted for him will be personally responsible for the inevitable outcome.

It is apparent that Israel will not hesitate to do whatever they think they need to do whenever they think the time is right. If they make a decision to attack unilaterally they know that we will have their back. Personally, I am tired of committing our soldiers and financial resources to conflicts that do not threaten our national security except in some politician’s war hawk brain. Our Founding Fathers including Washington and Jefferson were very adamant that we should only declare war in case of a vital threat to our national security. Since the War Powers Act that FDR signed after the attack on Pearl Harbor, the executive ability to effectively declare war without a Constitutional act of Congress has become easier and easier with every subsequent administration.

Perhaps American exceptionalism has contributed to our eagerness to involve ourselves in foreign military campaigns. As the world’s number one energy producer I find it hard to believe that the U.S. is merely motivated by commerce. In any case, anyone that is a strict Constitutionalist will have to recognize this fundamental deviance from the Constitution and the Founding Fathers intention. To oppose this possibility to avoid war with Iran is certainly tantamount to inviting war. Republicans have historically favored war on various non-Constitutional grounds. Did you know that Eisenhower, a Republican, started our involvement in Vietnam? Check it out. The opposition of the Republican dominated Congress to any attempt to avoid war should be punished by the voters. However, I tend to doubt if it will since Americans seem to turn a blind eye to these kind of international involvements. I hope war weariness will show itself in the actions of the American electorate. We have enough problems here in this country without spending more American resources on efforts that just create more problems for us and hatred of the U.S..

Please listen to the Republican presidential candidates. They really think that tough talk and actions will be better in the long run for the U.S.. Are we willing to once again tragically take that chance? Every historical despot has thought the same thing. History is replete with examples which proves it does not work. Rome overextended its military campaigns on this line of reasoning only to lose the empire. The German Nazis also spread themselves too thin on the Western and Eastern fronts. The U.S. will not make our country more secure by becoming more aggressive with every regional and international skirmish. We will only create more enemies, kill our young folks and rake up multi-trillion dollar debts as we did with Iran and Afghanistan. If we keep electing war hawks we will not get peace but more war. American voters should make it very hard for our politicians to get us into war. This should have been the lesson of Vietnam. I am not sure we are capable of learning these lessons. If we do not, we will not be remembered well by history. The U.S. should always err on the side of peace if we want to do something historically different.

War is always an option and Senator Gardner is not doing any of us a favor by disregarding any treaty in advance to restrict Iran’s nuclear ambitions. We may not be able to “completely eliminate the threat of a nuclear Iran” for all time but any delay to war, even if ten years, should not be dismissed lightly and ideologically. Senators Gardner’s inability to think and act rationally due to political affiliations proves that he is none other than the typical partisan, Republican war hawk that G.W. Bush and the neocons were. They were wrong then and they are STILL wrong! Please write him and let him know but don’t get your hopes up.

Right wingers in Texas are at it again and this time with the help of a far right wing hate group called the American Freedom Defense Initiative. Their latest “art exhibit and carton drawing contest” was designed to award the funniest cartoon drawing of Mohamed. Their key note speaker Geert Wilders is a Dutch politician who makes his living hating Islam.

Texas Governor Gregg Abbott called out the Texas Rangers to “protect his state from an Obama-led military takeover” from U.S. troops doing training exercises in the Southwest including Texas.

All these right wing nuts are on a fishing expedition to catch Islamic radicals. Well, they snagged a couple nuts, nuts killing nuts.

If Americans keep voting for these right wing nuts our country will start fighting wars that make the wars of G.W. Bush look like a Texas bar room brawl.

How is universality compatible with racism? The answer-to be found in the logic of what first inspires racism involves a basic modification of the very idea of universality. Universality must give way to the idea of expansion, for the expansion of a force presents a structure that is completely different from the propagation of an idea. The idea propagated detaches itself essentially from its point of departure. In spite of the unique accent communicated to it by its creator, it becomes a common heritage. It is fundamentally anonymous. The person who accepts it becomes its master, as does the person who proposes it. The propagation of an idea thus creates a community of “masters”; it is a process of equalization. To convert or persuade is to create peers. The universality of an order in Western society always reflects this universality of truth. But force is characterized by another type of propagation. The person who exerts force does not abandon it. Force does not disappear among those who submit to it. It is attached to the personality or society exerting it, enlarging that person or society while subordinating the rest. Here the universal order is not established as a consequence of ideological expansion; it is that very expansion that constitutes the unity of a world of masters and slaves. Nietzsche’s will to power, which modern Germany is rediscovering and glorifying, is not only a new ideal; it is an ideal that simultaneously brings with it its own form of universalization: war and conquest. But here we return to well-known truths. We have tried to link them to a fundamental principle. Perhaps we have succeeded in showing that racism is not just opposed to such and such a particular point in Christian and liberal culture. It is not a particular dogma concerning democracy, parliamentary government, dictatorial regime, or religious politics that is in question. It is the very humanity of man.¹ Emmanuel Levinas

As a victim of fascism and concentration camp survivor, Levinas well understood the outcome of power and racism. In the quote above Levinas sketches out what he believed to be a critical ground of racism not in the horrific acts of racism but in the seemingly banal appeal of what he terms the “idealist liberalism” in historical Christianity. Levinas thinks that in Christianity we have a liberation of spirit, an unprecedented act of freedom in the idea. Prior to this denouement where freedom begins, the human spirit was chained to the powerlessness of the body and the brutality of the natural world. Levinas writes,

It makes it impossible to apply the categories of the physical world to the spirituality of reason, and so locates the ultimate foundation of the spirit outside the brutal world and the implacable history of concrete existence. It replaces the blind world of common sense with the world rebuilt by idealist philosophy, one that is steeped in reason and subject to reason. In place of liberation through grace there is autonomy, but the Judeo-Christian leitmotif of freedom pervades this autonomy.

The temptation the liberation of the soul from the body brings is expanse. Expanse is the exercise of power. Force is the ontic effect of power. Power does not diminish in its use; it intensifies itself in the manifestation of force. I might add, the freedom and universalization of the idea perhaps indulges the natural narcissism of human being. As the old motif goes ‘absolute power corrupts absolutely’. The spiritual liberation of spirit sets the conditions for infinite expansion of the ego. From this authentic epoch of being, a new man draws its first breath, the modern master and the slave emerge. The master expresses the ideal world of the soul. The slave remains bound by the shackles of the natural world, the abomination of abominations. In the clear light of reason an unbridled exercise of egoistic freedom announces itself, free, liberated, unchained from every constraint, natural and ethical determinations. In this moment, Hitlerism blinks and gazes long into an abyss and the abyss gazes back.²

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¹ Reflections on the Philosophy of Hitlerism

Author(s): Emmanuel Levinas and Seán Hand

Source: Critical Inquiry, Vol. 17, No. 1 (Autumn, 1990), pp. 62-71

Published by: The University of Chicago Press

 

² I would like to thank Robert Bernasconi for an inspiring lecture last night at the University of Colorado in Denver and the occasion for my discovery of this text of Levinas.

Republicans are calling out the Clintons for not disclosing all the donors to their charity foundation. Let’s see, what party to this accusation has put all the resources and money into making it easy for political donors to not disclose their identity? What party bought and won the Citizen’s United Decision?¹ If there is quid pro quo in the Clinton’s case, a vigilantes group shouting hang-um high and tying to reap the political benefits of gossip is not the way to settle it. We have ample law enforcement groups in the Federal Government to discover and prosecute any violation of law. Of course, if you conveniently have been conditioned to hate or distrust the Federal Government then you probably have also decided another source is more reliable and trustworthy like Fox News for instance. Certainly there must be more checks and balances in Rupert Murdoch’s organizations than anything the framers of our Constitution could have set up. After all Rupert set up the largest collection of gossip media on the planet so he must know something about facts right?

I really do believe the Republican’s dominate rhetorical strategy is to publicly disavow the Darwinian, survival of the fittest,² ‘free’ market strategies they employ and shift any righteous indignation from the less survivable types towards any ideologies which threaten the conqueror’s dominance. They actually blame the advocates of these ‘dangerous ideologies’ for the very activities they employ covertly and overtly much more effectively and with much greater impact. So, for example, Hillary Clinton is accused of taking money for a charity organization where she receives none of the proceeds for some alleged quid pro quo bribe. She did not benefit from these contributions directly but other, less fortunate folks benefited from them. Allegations of indirect financial benefit have no basis in fact but convenient election year politics by a factually challenged author.³ All the while, the political party which consistently aligns themselves with big business has effectively changed laws which benefit their benefactors.

One such effort the Republicans got through in the Clinton administration deregulated the financial market. From the Clinton years through the Bush years, the sub-prime loans these derivatives where partially based on went from millions of dollars to multiples of billions of dollars. The Bush administration continually resisted efforts to reign in sub-prime lending by gutting regulatory oversight.⁴ This directly resulted in the collapse of these ‘free range’ financial derivatives effecting the entire planet during the Great Recession. The failures of mortgages alone in the U.S. could have never had this large of an impact on the world economy without the multiplier effect of the deregulated derivatives. Yet, the conservative American Enterprise Institute and the Heritage Foundation blamed sub-prime loans in the U.S. not financial deregulation even though the bi-partisan Financial Crisis Inquiry Commission found financial deregulation to be a major factor in the collapse.⁵

In addition, Republican intelligentsia know if they can convince the slaves they are free they can suppress rebellion and trouble makers. They cater to the aspirational desires of the less fortunate with an illusion of financial success and freedom all the while enacting laws and protections which make it harder for the less fortunate to realize their dreams and easier for the most fortunate to protect and increase their gains. It will be interesting to see how long this charade can go on before it begins to wear thin and it dawns on folks that perhaps the ‘free’ market is more like Santa Clause than reality. One thing we can certainly ascertain that Marx seemed to have missed completely is that people appear to be much more disposed towards aspirational, wish-fulfillment⁶ than necessity.⁷ To die without hope is worse than to die without food. It is too bad that this dismal bi-polar choice is also a produced illusion as the tools of a market economy and democracy and fairness do not have to be essentially at odds.

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¹ Formalism: When a Lie Becomes Truth (really)

² Free Market Either/Or Government?

³ The Washington Post, Rachel Maddow explores ‘Clinton Cash’ book’s connection to New York Times, Washington Post

⁴ The Credit Crisis: The Bush Administration’s Record of Denial and Regulatory Neglect

⁵ Latest Observations on the Housing and Economic Crisis

⁶ Aspirational, wish-fulfillment is not rooted in the material conditions of human labor and overcoming alienation. It has no practical basis in need but in wish, phantasma. In this sense, fantasy becomes the nexus of wish and fulfillment. It is rooted in the concrete production of abstract possibility for the implicit purpose of perpetual illusion, the mirage of utopia. In this case, Sisyphus did not roll the huge boulder up the steep hill for punishment but for reward which can never quite be realized. The machinery of this production is built on the ever deferred pot of gold at the end of the rainbow. Immediate need is marginalized for the promise of unbridled success. This notion makes Marxist alienation into fulfillment. In effect, it reverses the dialectic of materialism into a totalizing dialect of spiritualism. It diminishes the negative effects of alienation into non-existence, unconscious sublimation which favors the ‘truth’ of the desire for completion over the concrete struggle for existence. The collective and constant reaffirmation of fantastic aspirations replace the Marxist dialectic of aspiration and alienation. Perhaps, this could be thought in terms of Marx’s critique of Hegelian Idealism but with the ‘higher order’ production of non-falsifiable and totalizing ideals and desires for capital utopia replacing the Hegelian Idea (Begriff) and inverting the Marxist analysis of alienation into a collective virtue.

“True heteronomy begins when obedience ceases to be obedient consciousness and becomes an inclination. The supreme violence is in that supreme gentleness. To have a servile soul is to be incapable of being jarred, incapable of being ordered. The love for the master fills the soul to such an extent that the soul no longer takes its distances. Fear fills the soul to such an extent that one no longer sees it, but sees from its perspective.”
Levinas, E. (2012-12-06). Collected Philosophical Papers (Phaenomenologica) (Kindle Locations 1066-1069). Springer Netherlands. Kindle Edition.

⁷ What’s the Matter with Kansas?: How Conservatives Won the Heart of America

Hillary Clinton’s charity foundation took money from bad guys to help children. The bad guys could have spent the money on bad deeds so it was wrong that Hillary took that money to help kids. Also, her foundation took money from foreign countries that discriminate against women to fund programs that reduce discrimination against women. “That is just wrong” a Fox News spokesman told us.

Additionally, Fox News reports that while Hillary may ‘say’ she is for the lower 90% and against the upper 10% of income earners she is really part of the upper 10% herself so “how in the world could she ever understand the plight of the lower 90% as Fox News, the Republican Party and the upper 10% which makes up the most of the financial support of the Republican Party do”?

Fox News also reports that the total mess the Democrats have made of foreign policy and the economy is not how the former President left it when he left the office. It was the leadership of the former President that let the world know the United States is in charge as Afghanistan and Iraq proved. Also, the top 10% actually made more income during the Great Recession that was started during the Bush administration and the trickle down jobs started by the job creators simply made the current President look good but was really a direct result of successful wall street, free market, policies advocated by the Republican Party. They also went on to say that on their watch they proved that they would go up against corporations to big to fail as Lehman Brothers, Goldman Sachs and Bear Stearns discovered before they were bailed out. It just so happened that the former President’s policies to help poor folks get houses bankrupted the world with wacky financial tools that the Republicans pushed through Congress in financial deregulation during the Clinton years.

An unofficial spokesman for Fox News who did not want to be disclosed told us that thanks to the Citizens United Decision of the Supreme Court, wealthy Republicans have secretly converged to finance the campaigns of all the Republican Candidates to make the public think all the conservative voices are being heeded by the Republican Party but their plan is to strategically pull the funding so their candidate of choice, as yet undisclosed, can sail through their primary process and win in the general election with more moderate claims and high indebtedness to their benefactors.

Note: In the interest of fair and accurate reporting all the news above was really fabricated by a commy, liberal unless you think it actually made Republicans look good in which case it was totally true.

The historical data below shows important U.S. political and economic factors from 1917 to 2014. The charts were made in an Excel 2007 spreadsheet. The spreadsheet with the data tables and charts can be downloaded here. For each chart, the charts shows the Republican and Democratic makeup of the U.S. Congress, the Republican or Democratic President and the following data:

Chart 1

Bottom 90% annual income share in percentage of total income including capital gains¹

Top 1% annual income share in percentage of total income including capital gains ²

Top 5% annual income share in percentage of total income including capital gains ³

Top 10% annual income share in percentage of total income including capital gains ⁴

Chart 2

Annual Gross Domestic Income (GDI) per capita⁵

Bottom 90% average income in dollars including capital gains⁶

Top 1% average annual income in dollars including capital gains ⁷

Top 5% average annual income in dollars including capital gains ⁸

Top 10% average annual income in dollars including capital gains ⁹

Annual Federal deficit per capita¹⁰

Chart 3

Annual GDP % change¹¹

Annual Unemployment rate¹²

Annual Inflation as a percentage¹³

Chart 4

Annual Federal deficit per capita¹⁴

The purpose of these charts is to layout the full political and economic facts to get a sense of perspective based on solid sources detailed below in the endnotes. I always approach this type of data as ‘come what may’. Of course, I have opinions and conclusions as we all do. However, I really believe in letting the facts speak for themselves. If the facts show I am wrong about an opinion I will, and historically have, changed my opinion to suit the facts. I do not have that high a degree of personal stake in my opinions which would override whatever truth may come from the facts. There is a degree of truth that can be ascertained by well sourced facts about politics and the economy. However, it takes continual work to try to accommodate opinions and conclusions to reality.

There are way too many fanciful ‘facts’ flippantly tossed about that result in erroneous conclusions. Conclusions based on mere opinion with little or no underlying facts allow perceptions to rule in elections. Perceptions are the only concern of political commercials. Truth, to whatever degree it can factually be ascertained, is fundamental to a working democracy. I have included some conclusions I think can or cannot be drawn from the data below. I would welcome any further comments pro or con as well.

The charts, as shown below, are too large in a web format to see details adequately. However, there are some things seen below that immediately jumped out at me. First, notice the squeeze in the 1920 to 1940 and 1980 to the present, income levels in the United States on Chart 1. What this tells us is that the bottom 90% of income share in the United States came down around the Great Depression and started coming down in Reagan years until the Great Recession of the 2008. Also, notice that the top 10%, 5% and 1% of income share rose during those years resulting in what I term the Great Crunch.

Chart 2 shows the dollar amount of the Great Crunch. The gross domestic income per capita was relatively flat during the Great Depression years and rose slightly from the Reagan years to the present. This was probably the effect of the upper income bracket’s large rise in income share during those years. After the Great Depression, the upper income brackets were taxed in the 90+ percentile tax bracket after a certain amount of income was obtained. Ronald Reagan cut those large taxes on the wealthy and they continued to pay lower and lower taxes from then to the Clinton years when their taxes went up. In the Bush years their taxes went down again. They also accrued more and more tax shelters during these years. If the claim of the right that lower taxes create jobs is correct, we should have seen unemployment go down in the Reagan years. However, the data actually shows that unemployment actually went up in the Reagan years. Conversely, President Clinton raised taxes on the very rich in the 90s and employment went up.¹⁵ If the claim of the right is correct, where is the proof? The proof goes counter to their claim.

Chart 2 also shows the bottom 90% average income going down slightly from the gross domestic income per capita and can be seen better in the more detailed view of Chart 2 further below. The spreadsheet tables show the actual dollar amounts started at around $11,000 annually in 1917, went to a low of about $7,500 in the Great Depression, started rising to about $36,500 in 2000 and declined from there to about $31,000 in 2012. The upper 10% income brackets did bump up some just before the Great Depression years in real 2012 dollars but in recent decades since Reagan those brackets rose tremendously with the upper 1% rising 300% to 400% in the decade of 2000 and more than doubling for the top 5% and top 1%.

Another claim of the right is that all the meddling of the Federal Reserve results in inflation, boom and busts and unemployment. Chart 3 does not validate this claim. Inflation, unemployment and GDP have been tamed much more since Franklin Delano Roosevelt’s administration greatly empowered the Federal Reserve, created depository insurance and financial regulatory requirements. Inflation, unemployment and GDP were much more erratic from 1917 through the Great Depression (and even before 1917). Do we really want to get rid of the Federal Reserve, depository insurance and financial regulatory requirements as the Austrian Economists suggest and go back to those days?

The charts also show that Democratic Presidents and Democratic Congress’ presided over the recovery from the Great Depression and the Great Recession of 2008. It also shows that Republican Presidents and Republican Congress’ presided just before these economic catastrophes. However, much to my surprise, mixed parties controlled the Congress and the Presidency over much of the more economically stable period from the recovery of the Great Depression to the Reagan years. My personal opinion is that the Old Right¹⁶ was much more sympathetic to the bottom 90% than the new right of recent years. Democrats and Republicans were able to pass bills which actually benefitted the middle class in those years and spread the income share between the bottom 90% and the top 10% as evidenced by Chart 1.

Chart 4 shows the Federal deficit per capita. The right has made much of Obama Care and the Federal Government’s hit on the national debt. The national debt is fueled by the annual deficit. While the deficit per capita bumped up slightly during the Great Depression recovery, it had a surplus of $1,000 per person in 2000 under President Clinton and a debt of $6,000 per person in 2009 under President George W. Bush until President Obama was inaugurated. Since then it has gone down to less than $2,000 per person of debt. This is obviously not what the right has been telling us. The facts actually tell us that the right has told us a blatant lie. The deficit did spike up from the social safety net set in place by Democrats and Republicans over the decades under mandatory spending requirements which no president could unilaterally change; only an act of Congress can change mandatory spending. The social “safety net” as, President Reagan called it, did exactly what is was suppose to do. If it had not done its job, the Great Recession of 2008 would have had a much more severe impact on average working families and probably would have prolonged the effects of the recession. However, the deficit immediately start coming down under President Obama; again, contrary to the blatant lies of the new right.

I believe that the 2014 elections were rigged, thanks to the narrative paid for by virtue of the Citizens United Decision,¹⁷ by lies which obviously benefit the wealthy not the working class. There was a right at one time that did care about the middle class and proved it with facts. However, the new right does not resemble that party in reality and the economy. It is high time that the old notion that Republicans are better for the economy get updated to reflect reality and not aspirational nostalgia. I would also add a word of caution I see in the data that the worst may not be over yet. The Great Crunch does not look like it is receding yet. Economists have told us for many years that the engine of the economy is the consumer not the wealthy. The consumer spreads out the risks of the economy and thus minimizes the chance of economic catastrophe. The facts bear this out. If we continue down the path which rewards wealth and punishes the consumer we may not have seen the ‘big one’ yet. A mixed party of Executive and Congressional branches of government may not fan the flames of the Great Crunch but we need to move away from the precipice of decreasing the income of the bottom 90% and increasing the income of the top 10% or we may find ourselves in a depression that will make the Great Depression look like a dress rehearsal.¹⁸ If a Republican is elected as President in 2016 with the new majorities of Republicans in the Congress, we could be well on our way to economic catastrophe as history is the witness.

The charts below are the same as the charts above but with more detail. In order to do this, the timelines have been split. Note that not all the data fields are fully filled out due to the lack of earlier reliable data. The top of each chart shows the percentage of Democrat and Republican, U.S. Senators and Representatives. The solid horizontal colored bars shows the presidential party in power at the time. Democrats are displayed in blue and Republicans are displayed in red.

Here are the dates from 1917 to 1971 for Chart 1.

Here are the dates from 1971 to 2014 for Chart 1.

Here are the dates from 1917 to 1973 for Chart 2.

Here are the dates from 1971 to 2014 for Chart 2.

Here are the dates from 1917 to 1973 for Chart 3.

Here are the dates from 1970 to 2014 for Chart 3.

Here are the dates from 1917 to 1973 for Chart 4.

Here are the dates from 1971 to 2014 for Chart 4.

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¹ Alvaredo, Facundo, Anthony B. Atkinson, Thomas Piketty and Emmanuel Saez, The World Top Incomes Database, http://topincomes.g-mond.parisschoolofeconomics.eu/, 11/12/2014, See The World Top Incomes Database, real 2012 US Dollars, gross income before taxes, fractiles defined by total income including capital gains; income includes capital gains, the income share is the percentage share of annual income of the bottom 10% in the United States

² Alvaredo, Facundo, Anthony B. Atkinson, Thomas Piketty and Emmanuel Saez, The World Top Incomes Database, http://topincomes.g-mond.parisschoolofeconomics.eu/, 11/12/2014, See The World Top Incomes Database, real 2012 US Dollars, gross income before taxes, fractiles defined by total income including capital gains; income includes capital gains, the income share is the percentage share of annual income of the top 1% in the United States

³ Alvaredo, Facundo, Anthony B. Atkinson, Thomas Piketty and Emmanuel Saez, The World Top Incomes Database, http://topincomes.g-mond.parisschoolofeconomics.eu/, 11/12/2014, See The World Top Incomes Database, real 2012 US Dollars, gross income before taxes, fractiles defined by total income including capital gains; income includes capital gains, the income share is the percentage share of annual income of the top 5% in the United States

⁴ Alvaredo, Facundo, Anthony B. Atkinson, Thomas Piketty and Emmanuel Saez, The World Top Incomes Database, http://topincomes.g-mond.parisschoolofeconomics.eu/, 11/12/2014, See The World Top Incomes Database, real 2012 US Dollars, gross income before taxes, fractiles defined by total income including capital gains; income includes capital gains, the income share is the percentage share of annual income of the top 10% in the United States

⁵ See Gross Domestic Income per capita, FRED Graph Observations, Federal Reserve Economic Data, Economic Research Division, Federal Reserve Bank of St. Louis, Gross Domestic Income (GDI), dollars per person, annual, not seasonally adjusted, the dollar amount is found by dividing each annual GDI by the population for that year as defined by the Census Bureau

⁶ Alvaredo, Facundo, Anthony B. Atkinson, Thomas Piketty and Emmanuel Saez, The World Top Incomes Database, http://topincomes.g-mond.parisschoolofeconomics.eu/, 11/12/2014, See The World Top Incomes Database, real 2012 US Dollars, gross income before taxes, fractiles defined by total income including capital gains; income includes capital gains, average income-including capital gains

⁷ Alvaredo, Facundo, Anthony B. Atkinson, Thomas Piketty and Emmanuel Saez, The World Top Incomes Database, http://topincomes.g-mond.parisschoolofeconomics.eu/, 11/12/2014, See The World Top Incomes Database, real 2012 US Dollars, gross income before taxes, fractiles defined by total income including capital gains; income includes capital gains, average income-including capital gains

⁸ Alvaredo, Facundo, Anthony B. Atkinson, Thomas Piketty and Emmanuel Saez, The World Top Incomes Database, http://topincomes.g-mond.parisschoolofeconomics.eu/, 11/12/2014, See The World Top Incomes Database, real 2012 US Dollars, gross income before taxes, fractiles defined by total income including capital gains; income includes capital gains, average income-including capital gains

⁹ Alvaredo, Facundo, Anthony B. Atkinson, Thomas Piketty and Emmanuel Saez, The World Top Incomes Database, http://topincomes.g-mond.parisschoolofeconomics.eu/, 11/12/2014, See The World Top Incomes Database, real 2012 US Dollars, gross income before taxes, fractiles defined by total income including capital gains; income includes capital gains, average income-including capital gains

¹⁰ See Federal Deficit per capita, the dollar amount is found by dividing each annual deficit by the population for that year as defined by the Census Bureau

¹¹ See GDP from 1929 to the present(xls), U.S. Bureau of Economic Analysis, GDP in billions of chained 2009 dollars

¹² See Bureau of Labor Statistics, Unemployment Rate

¹³ See Inflation

¹⁴ See Federal Deficit per capita, the dollar amount is found by dividing each annual deficit by the population for that year as defined by the Census Bureau

¹⁵ See THE TRUTH ABOUT TAXES: History Suggests High Tax Rates On Rich People Do Not Hurt The Economy, See The Numbers Don’t Lie-Why Lowering Taxes For The Rich No Longer Works To Grow The Economy

¹⁶ See Conservatism and Liberalism: A Historical Perspective

¹⁷ See Formalism: When a Lie Becomes Truth (really)

¹⁸ See Plutocracy and Democracy: A Credit Suisse Report

 

From this site:

Financial Great Depression Facts

* In the 1920s, the wealthiest one percent owned more than a third of American assets.

* When stock speculator was a prominent practice, banks lent money to investors to buy stock. Nearly $4.00 out of every $10.00 borrowed from the banks was used to buy stock

* The average income of the American family dropped by 40 percent from 1929 to 1932. Income fell from $2,300 to $1,500 per year.

* During the 1930s, manufacturing employees earned about $17 per week. Doctors earned $61 per week.

* The stock market didn’t return to pre-depression levels until 1954.

– See more at: http://great-depression-facts.com/#sthash.2qT5aOAn.dpuf

Marriner S. Eccles, who served as Franklin D. Roosevelt’s Chairman of the Federal Reserve from November 1934 to February 1948, detailed what he believed caused the Depression in his memoirs, Beckoning Frontiers (New York, Alfred A. Knopf, 1951).

As mass production has to be accompanied by mass consumption, mass consumption, in turn, implies a distribution of wealth — not of existing wealth, but of wealth as it is currently produced — to provide men with buying power equal to the amount of goods and services offered by the nation’s economic machinery. [Emphasis in original.]

Instead of achieving that kind of distribution, a giant suction pump had by 1929-30 drawn into a few hands an increasing portion of currently produced wealth. This served them as capital accumulations. But by taking purchasing power out of the hands of mass consumers, the savers denied to themselves the kind of effective demand for their products that would justify a reinvestment of their capital accumulations in new plants. In consequence, as in a poker game where the chips were 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.

That is what happened to us in the twenties. We sustained high levels of employment in that period with the aid of an exceptional expansion of debt outside of the banking system. This debt was provided by the large growth of business savings as well as savings by individuals, particularly in the upper-income groups where taxes were relatively low. Private debt outside of the banking system increased about fifty per cent. This debt, which was at high interest rates, largely took the form of mortgage debt on housing, office, and hotel structures, consumer installment debt, brokers’ loans, and foreign debt. The stimulation to spend by debt-creation of this sort was short-lived and could not be counted on to sustain high levels of employment for long periods of time. Had there been a better distribution of the current income from the national product — in other words, had there been less savings by business and the higher-income groups and more income in the lower groups — we should have had far greater stability in our economy. Had the six billion dollars, for instance, that were loaned by corporations and wealthy individuals for stock-market speculation been distributed to the public as lower prices or higher wages and with less profits to the corporations and the well-to-do, it would have prevented or greatly moderated the economic collapse that began at the end of 1929.

The time came when there were no more poker chips to be loaned on credit. Debtors thereupon were forced to curtail their consumption in an effort to create a margin that could be applied to the reduction of outstanding debts. This naturally reduced the demand for goods of all kinds and brought on what seemed to be overproduction, but was in reality underconsumption when judged in terms of the real world instead of the money world. This, in turn, brought about a fall in prices and employment.

Unemployment further decreased the consumption of goods, which further increased unemployment, thus closing the circle in a continuing decline of prices. Earnings began to disappear, requiring economies of all kinds in the wages, salaries, and time of those employed. And thus again the vicious circle of deflation was closed until one third of the entire working population was unemployed, with our national income reduced by fifty per cent, and with the aggregate debt burden greater than ever before, not in dollars, but measured by current values and income that represented the ability to pay. Fixed charges, such as taxes, railroad and other utility rates, insurance and interest charges, clung close to the 1929 level and required such a portion of the national income to meet them that the amount left for consumption of goods was not sufficient to support the population.

This then, was my reading of what brought on the depression.

 

“LET THE MARKET DECIDE” is the battle cry of Republicans except when they do not like what the market decided.

Republicans want to blame President Obama and the Democrats for interfering with oil company profits. Writing of energy production, they tell us “Democrats Should Join the Revolution“. The Republicans have conveniently ignored the fact that oil production in the Obama administration has increased to the point where we are predicted to be energy independent by 2015.¹ CNBC’s Michelle Caruso-Cabrera, a Republican free marketer advocate, recently stated concerning gas price caps in “China, India and all of the Middle East”, “Now personally I think they should get rid of price caps completely.”² Well, now that the Saudis have cut oil prices, Michelle Caruso-Cabrera stated this morning on MSNBC’s Morning Joe show that the Saudis are trying to drive U.S. shale production out of business. She also stated the Saudis are trying to hurt the Russian oil market too. Hey Republican’s, try not to contradict yourself! You claim we should live and die by the prices set by the market but when the market is killing your oil production buddies you start squealing and complaining? It seems that the Democrats are not your biggest enemy but the free market. Maybe you should just shut up and take your medicine. After all, you are the ones that prescribed it.

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¹ See IEA Predicts the U.S. Will Be the World’s Largest Oil Producer by 2015

² See Caruso-Cabrera’s Snowball in Hades: ‘Europe’s High Gas Taxes Pay for Outdated Socialist Programs’

In Colorado we have been beaten to death with commercials on both sides of the political spectrum which assume everyone listening is an absolute idiot. At the least, they think enough people out there are idiots enough to get swayed by these ridiculous commercials to put millions of dollars in them. I do not know how these strategists come up with their strategies but here is my two cents:

Don’t let the other side set the narrative. The Republicans have totally set the narrative for the 2014 elections. The Democrats are constantly caving, placating and playing defense. You do not get ahead by playing defense in politics, you only minimize your loses. In the long run, negativity and fear based propaganda tire folks out, discourage them and make them apathetic. That strategy is not the strategy that works for the Democrats. Even the smartest Republicans have figured out that happy, smiling, ‘apparent’ non-nut-case-politicians go further than gun totting, ethnic and government hating, religious fanatics. Make no mistake, Cory Gardner is as right as they come and will vote Republican 99.999% of the time but he plays a good happy, go-lucky optimist. No matter, the Koch brothers own him lock stock and barrel. He has obviously been groomed very well to portray the image that Democrats find most natural, happy and positive. Why are our strategists thinking they can play the Republican game and win. Hey guys, go to the other side if that is how you want to play. You are not playing to our strengths as Democrats as the current election cycle should tell you.

Democrats have a positive agenda unlike the other side and need to set that agenda. Many Republicans tend to vote because they hate Democrats not because they have a positive agenda. They do not have any social answers except let the market decide. The market decided not to do a damn thing about health care for decades and that was ok for the Republicans but not for us. Many of our Democratic members vote because we have positive ideas for helping the country like health care, economics which help the middle class, address poverty in a way that stimulates the economy, improve our infrastructure and make education better and more accessible. I have done lots of hard core research and written lots of posts on this blog and I know that Democrats have the facts on our side. We do not need negativity, lies or apologies. We have the facts and the results. We actually accomplished something historic in health care on the heels of one of the worst presidencies in our history, George W. Bush. Bush crashed the economy started two absurd wars with the help of the war hawk, neocons in his party and what do the Democrats have to say about it now?…We are sorry. We did not like Obama or health care. We apologize that the economy is much better. You would never know that Colorado has the best recovering economy of any state by listening to political commercials. Are we sorry we got our country out of massive wars and massive national deficits. This strategic response has to go down as the most idiotic, cynical, sniveling, gutless campaign in history. Democrats, please let these spineless strategists go to the other side. Get some folks in there that will be proud of what we have done and advertise the hell out it. We will not win over the cynical Republicans. Cynicism is their game not ours. We own the long term in this country so start acting like winners not losers . Conservative white guys are dying off. We have an evolving electorate that will go for us but we need to show them how we have earned their vote not play the fright night game on them. Our message is positive and has a truthful, solid record of accomplishment. We do not get our jollies off watching all the fear and negative crap on Fox news. Watch Fox and then watch MSNBC. Look on their faces for the sneers, half smiles, one squinted eye, dogged sternness. Look for round faces, proportional smiles, relaxed and unstrained facial muscles. The difference you see will tell you something about who we are and who we are not. Folks that are not in either camp will not get converted no matter how alarming and negative the TV ads are. They are probably not that interested in politics and trying to figure out who is right or wrong, fact based or not. These are not the apathetics. They do not vote anyway. These are the folks that care more about the demeanor than the ideas. They want to see genuine, relaxed faces which exude confidence and positivity. They want to see ‘can do’ not ‘screw you’. They do not like sniveling, apologetic wimps. Don’t cower, tower. People like people that are genuine, never lie or exaggerate, do your homework on the facts, use credible unaffiliated sources. If you are wrong, apologize directly and get back on the horse. Don’t sit in the dust and snivel and cry. Take some pride in yourself. Whatever you do, do not listen to the strategists that want you to be fake and phony and soften the truth. You end up looking like a despicable clown and don’t think people can’t see right though you, they absolutely can. Strategists, if you can’t take pride in what Democrats have done, we do not need or want you. Do us a favor and get another job. You really don’t have a clue.