The Weiner Component #168 – As You Sow, So Shall You Reap: The Recent History of the Republican Party

With the Friday, October 7th release of the lewd and sexual harassing conversation, that Trump did in 2005 on a bus into an open microphone to Billy Bush, one of the hosts of the TV show “Access America,” while on the way to do another show, being made public, many of the Republican leaders, in and out of Congress, are calling upon Trump to drop out of the 2016 Presidential race as the Republican candidate.  When he refused, saying that the conversation was only “locker room talk,” many Republicans, in and out of Congress, still want to drop the Party’s support for him, arguing that he’s already lost the election.  They want to concentrate all the Party’s resources and efforts on the Congressional and state elections.  Paul Ryan, while still endorsing Trump, has stated that he will no longer campaign with him and that Republicans should concentrate on Congressional and state election.

 

speaking at CPAC in Washington D.C. on Februar...

Paul Ryan and Mitch McConnell were in shock.  Ryan was booed on Saturday, October 8, for disinviting Trump from the Wisconsin Unity Rally.  But both Ryan, the Speaker of the House, and McConnell, the Majority Leader in the Senate, are equally guilty of creating the milieu within the United States that allowed Trump to become a presidential candidate.  Both are equally guilty of bringing about the gridlock in Congress that caused very little to be done there, in keeping the government barely functioning, and even shutting it down for a while.  Even now, with Republican majorities in both Houses of Congress, there is a short term funding bill for a small part of the next fiscal year’s budget.  This includes, after four months hassling, Zika funding.

 

Every effect has a cause; and the cause of Donald Trump being the Republican presidential candidate can easily be traced back to Republican inaction in passing the necessary laws needed to run this country.  Every Republican in Congress worked to make Barack Obama a one term President and then still refused to cooperate with him during his second term in office.  They are all equally responsible for Donald Trump being their presidential candidate today.  They, by their inactions, created the situation that exists today.  They are all the cause of their own present-day ever-growing discomfort, Donald Trump.

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I suspect that by the end of his second term, President George W. Bush couldn’t even have won an election to become dogcatcher.  He has gotten absolutely no mention in the current election by Trump or other Republicans.  But he was the President of the United States who declared war on Iraq, supposedly because of their weapons of mass destruction, but actually to punish Saddam Hussein for attempting to have his “Daddy” assassinated.  He was the one who destabilized the Middle East and was the President responsible for much that was blamed on President Barack Obama.

 

George W. Bush has somehow gotten lost in history; but he was President of the United States only eight years ago; and much of what Donald Trump has blamed on President Obama was not only initiated by Bush but also carried out by him.  It was Bush who set up the U.S. exit from Iraq which President Obama then carried out.  And it was then the Iraqi and Afghanistan new governments that wanted the U.S. to withdraw.  Neither government was able to run their own state against the Taliban, the forces of the Middle East that opposed them.

 

And the U.S. National Debt was mostly created by Republican Presidents, starting with Ronald Reagan with his “Star Wars” operation which brought the Debt up to over one trillion dollars, to President George H.W. Bush who sent an army to remove the Iraqi military from Kuwait.  The war was known as Desert Storm and never would have been necessary if Bush had dealt properly with Saddam Hussein and not given him the impression that he could invade oil rich Kuwait.

 

The National Debt was actually decreased under President Bill Clinton.  But President George W. Bush initiated and fought two wars in the Middle East that, with slight interruptions, are still going on today. Through the efforts of these Republican Presidents the National Debt has soared from one trillion to over nineteen trillion dollars today.

 

The Great Recession of 2008 or to state it more clearly, the great bank caused housing bubble burst under President George W. Bush who initially bailed out the banks.  President Obama inherited it and in order to prevent it from becoming a greater depression than that of 1929 had to spend a lot of money.  He brought about a large degree of recovery in spite of the fact that a Republican led House of Representatives continually worked against it and his efforts to end it.  He also inherited two wars from George W. Bush. 

 

Donald Trump loudly and vociferously blames our NAFTA Agreement of 1993 on President Bill Clinton.  That agreement was initially negotiated by President George H.W. Bush in 1993.  Congress was unhappy with parts of it and these were renegotiated by President Bill Clinton and approved by both political parties in the Senate.  The initial international trade agreement was brought about by both a Republican and Democratic President.  Somehow Donald is either confused or he’s editing history to fit his pattern of what, he feels, the past should be.  Instead of calling President Obama a failed president he should call himself a failed candidate for the presidency.  This is especially true now that about a dozen or women have accused him of one or another form of sexual assault.

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Barry Goldwater (R) ran against Lyndon B. Johnson in the 1964 Presidential Election.  He was the first ardent conservative to run for the presidency.  Goldwater, according to his autobiography, did not expect to win the election.  He achieved 22% of the popular vote.  That percentage marked the extreme conservatives in the American electorate at that time. 

 

Interestingly Hillary Rodham (Clinton), as a high school student worked as a volunteer on his campaign.  Her parents were conservative and she initially followed in their footsteps.

 

From that time on the extreme right of the Republican Party worked avidly to improve their status with the electorate in the United States.  The next president, four years later was the Republican, Richard Nixon.  He was not as conservative as many in the party were.  Nixon resigned half-way through his second term over the Watergate Scandal.  He left the day before the House of Representatives was going to vote for a Bill of Impeachment.  Gerald Ford (R), the Vice President Nixon had appointed, replaced Nixon after his initial Vice President, Spiro Agnew, resigned over a corruption scandal.

 

President Ford appointed Nelson Rockefeller as his Vice President.  Rockefeller represented what was then left or liberal end of the Republican Party; he was a moderate Republican.  The next President, the Democrat, Jimmy Carter, would be more conservative than Nelson Rockefeller.  This group of Republicans would be a dying breed. 

 

Ford was president for two years and then was replaced by the Democrat, Jimmy Carter, who would, four year later, be replaced by the Teflon conservative Republican President, Ronald Reagan.  With Reagan the ultra-conservatives felt that they had one of their own in office.  Reagan, however was capable of compromise.  The comment during his period as president was that he would take half-a-loaf, that is, compromise if he got some of what he wanted.

 

Reagan was followed by George H.W. Bush.  He had to contend with a Democratic Congress.  Then came William Jefferson Clinton for the next eight years.  Clinton spent most of his time contending with a Republican Congress.  He was frustrated over a number of laws he couldn’t get passed.  During his last year in office he actually reduced the deficit.

 

Clinton was followed by George W. Bush who was initially elected with less than the majority vote.  A foul-up on the ballots in Florida and the fact that his younger brother was the governor of that state and had inappropriately purged the voter lists got him elected.

 

Barack Obama was the first Black elected to the Presidency of the United States.  I suspect that that had something to do with the way he’s been treated by Congress.  All the Congressional Republicans at an early caucus meeting swore to make him a one term President.  They decided that they would support nothing that he tried to do.  

 

It was largely because of this overall inaction that the general public was alienated from Congress.  This brought about a condition in the country whereby the Blue-collar Republicans were looking for a hero to free them from the Washington Republicans.  That hero, to them, was Donald Trump.  It is amazing that the Republicans in Congress still do not understand what they have done.  And that is because they are still acting in that fashion with their short-term funding bill which they will revisit in December before the next Congress meets in January.

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For most of his two terms in office President Obama bent backwards to accommodate the Republicans.  The Affordable Health Care Bill (Obamacare) was based upon a Republican plan developed by Citizen’s United, a far right think tank, for Mitt Romney when he was governor of Massachusetts.  It passed Congress on a partisan basis; in both Houses all Republicans voted against it and all Democrats voted for it.  From 2011 on the Republicans had a majority in the House of Representatives.  And outside of absolutely necessary bills nothing was passed.

 

A single bill can deal with an endless number of subjects and Paul Ryan came up with the idea of adding parts of their far right agenda to necessary bills that, for example, funded the United States.  That is why currently the bill to fund the U. S. for the next fiscal year was passed at the last minute and functions only until the middle of December 2016 when the Congress will meet again for a very short session presumably to fund the balance of the year.

 

The Republican dominated House of Representatives pattern is to pass their necessary bills at the last moment, shortly before they adjourn for some sort of extended break.  This means that the Senate gets very little time to consider the bill because they are also ready to leave for a period of time.  Consequently it’s pass the bill or let the nation suffer.

 

Ordinarily, every bill goes to a standing committee of members of that House where it is gone over, testimony on the bill can be taken and possibly the bill is modified, then it is sent to the specific house and can be debated before being voted upon. 

 

All money bills originate in the House of Representatives which directly represents the people, the Constitution gives them the “power of the purse.”  The Senate originally represented the states; they were elected by the legislative bodies in each state.  This was changed by the 13th Amendment to the Constitution in 1913 to where the people directly elected two Senators from each state.

 

After a bill is passed in one House it then goes to the other House and the same process is repeated.  Ordinarily there is some difference between the two bills and a Conference Committee, comprised of members of both Houses of Congress meet.  They work out a new version of the bill which then goes back to both House and is voted upon again.  If it passes in both Houses it is then sent to the President for his signature.  After he signs it the bill becomes law.  This process cannot be completed in two days.

 

The new process, presumably under Paul Ryan’s tutelage, was developed in the Republican dominated House after 2011 when the Republicans received a majority of members in the House of Representatives.  It was a means of forcing or blackmailing the Democratic dominated Senate and the President into accepting parts of the Republican agenda.  They either passed it quickly in the Senate and the President signed it or the country suffered.  An example of this was to take over four months to financially deal with the Zika epidemic and then to still not fully fund the bill to the amount requested by the President.

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Currently the Congress has the lowest approval rating in the history of its existence.  The Gallop Pole does a monthly survey which from 2011 to the present goes up and down continually from 9% to 20%.  A number of other polls average 13.8 % approval.  

 

Sooner or later there has to be a reaction to Congress’ high level of non-functionality.  That reaction in the 2016 Primaries was Donald Trump for those citizens who could not stand the Democratic agenda but were frustrated by that of the Republicans.  And Bernie Sanders was the candidate for those who were basically Democrats but were fed-up with Congressional gridlock.  Sanders has coalesced into the Clinton campaign and now supports her.

 

The Congressional Republicans created the field upon which Donald Trump, despite all the negative information that emerges about him, has flourished as the Republican Candidate.  They and they themselves by their strategies and actions have created him and now they refuse to take responsibility for what they have done.

 

Paul Ryan, who was totally disgusted by recent information that emerged about Trump, and cancelled his invitation to a rally with himself in Wisconsin, will no longer campaign with him.  He will concentrate upon Congressional elections only.  And it was Paul Ryan, as Speaker of the House of Representatives, who, at the last minute before adjourning the House, got the bill passed that temporarily funded the United States Budget through the middle of December so that the Republicans could once again make demands upon President Obama before he leaves office at the end of the year.

 

They are still playing the games that have lowered their approval rating with the American Public well under 20%.  Apparently winning political points is still far more important than carrying out their oaths to serve the American people.

 

The Republicans want political power and seemingly will do anything to achieve it.  And they will take no responsibility for the acts they perform.  It would be a nice irony for them if their actions caused them to lose control of both the House of Representatives and the Senate.  And, of course they would not understand how it came about.  Donald Trump, as a candidate, is their creation!

 

With the partial funding of the 2016 – 2017 budget the Federal Government may still face a major crisis.  If the House of Representatives attempts to force its agenda through at the last minute with the December Funding Bill then the last major act of President Obama may be to veto the Bill.  If this occurs then the current administration will end with a nonfunctioning government.  The new President will have to begin her administration by declaring a state of emergency until the government is legally funded in mid to late January of 2017 by the new Congress.  

 

Could this happen?  Very easily, if the Republican dominated House of Representatives attempts to force its will upon the country.  This would be shortly after the November 8th Election.  It would seem that a state of war exists between the Democratic President and the Republicans, and Donald J. Trump is just a byproduct of all this.

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“As you sow, so shall you reap.”  It shouldn’t take too much intelligence to understand this.

 

 

 

 

 

 

 

The Weiner Component #140D – Congress: Fiscal Policy & the Infrastructure

Dwight D. Eisenhower, official portrait as Pre...

Dwight D. Eisenhower, official portrait as President. (Photo credit: Wikipedia)

One of the greatest problems facing the United States today is the fact that most of its infrastructure was built in the late 19th and early 20th Centuries.  By definition the infrastructure is the basic physical systems of the cities, states, and country.  Largely our local cities, states and nation have acted as though they will last forever with little or no maintenance, repair, or modernization.  If something breaks down it is generally fixed.  In essence this nation has taken a Band-Aid approach to maintaining our infrastructure and as a result yearly the country falls farther and farther behind as its infrastructure slowly rots or becomes obsolete.

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It should be noted that when an individual buys a new automobile he knows or will quickly learn that the vehicle will need constant maintenance over its lifetime or it will stop functioning.  The same can be said for the basic apparatuses of our cities, states, and country as a whole.  Their roads, bridges, water supply, school buildings, transit systems, sewerage disposal facilities, electric grid, ports, airports, dams, etc. also need occasional replacement as they become obsolete or continual maintenance over their lifetimes otherwise they will eventually grow out of date or stop functioning, or, for that matter, both of the above.  All of these are called the infrastructure that allows the community, cities, states, and nation to function.  When they partially or completely break down there is chaos.  How come most people are responsible when it comes to their individual possessions but irresponsible when it comes to their communities of nation?

 

Specific responsibility for these entities can be local government or privates industry or a combination of these.  It can also be state government.  In the final analysis the ultimate responsibility rests with the lawmaking body of the National Government, the Congress.  They are responsible for the overall functioning of the nation.  They alone have the resources available, financial and otherwise to modernize, repair, or rebuild parts and pieces of the infrastructure, to provide for the needs of the entire nation.

 

Cities and states follow a system of microeconomics.  They have an income, the fees and taxes they collect.  If they have to spend more than they collect then they can issue tax-free long term, bonds to finance the project, usually a 30 year low interest, tax-free bond.  They are limited as to how many of these they can issue by their projections of their incomes over the next three decades.  The Federal Government does not have this problem.  They utilize macroeconomics and can issue money as needed.  They are also limited as to how much they can issue, but their limitation goes far beyond what any state or city can do.

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Because the problem currently seems insurmountable it has been largely ignored on virtually every level of government and keeps getting worse with each passing year.  In the third Republican 2016 Presidential Debate in early November of 2015 several of the potential candidates commented on the infrastructure, stating that it was the responsibility of the states and local governments to solve these problems, that the Federal Government should not be involved.  This is passing the buck or dropping the rock.  The cost of solving this problem is in the trillions of dollars.  No city or state can afford to do more than light maintenance of this problem.  The statement itself by potential candidates like Ted Cruz denotes total ignorance of the problem or total cynicism toward it.  No city or state can sell trillions of dollars’ worth of tax-free 30 year bonds and hope to be able to pay them off and operate the government at the same time.

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The city of Pittsburgh is known as the city of bridges, both highway and railroad bridges.  Most of them are old, nearing the end of their useful lives.  There are over 4,000 bridges in the city.  Over 20% of them are structurally deficient.  This includes one located as part of the city’s main arteries.  This bridge was built in 1928 when cars and trucks were lighter.  It was designed to last 50 years.  It is now 86 years old.  Five million people use it daily.  The bridge connects the northern and southern sections of the city.  It should have been replaced years ago.  At one point structural damage was discovered on the bridge.  It was closed for two weeks while structural repairs were made on that section causing great hardship to the people of Pittsburgh.  An arch bridge in the city had a platform type structure built under it to catch falling concrete which would otherwise hit traffic underneath it.

 

In Minnesota in 2007 a bridge collapsed, that was over 50 years old, killing 13 people and injuring another 145.  The antiquated Skagit River Bridge in Washington State collapsed last year after a truck hit one of its trusses.

 

The overall cost of repairing and replacing the needed bridges in Pittsburgh has been estimated at being over two trillion dollars.  It has been estimated that about one of every nine bridges in the country, about 70,000 of them are considered structurally deficient.  Some have had a section collapse.  Essentially repair has been done on a band aid basis, just repairing the damaged section.

 

The majority of airports in the United States are out of date.  They need to be modernized.  The majority of seaports are in danger of becoming obsolete as the ocean going ships gradually increase in size and number.  A report from the American Society of Civil Engineers states that 32 percent of the main American roads are now in poor condition and in need of major repairs.

 

In 1956 Congress passed and President Dwight D. Eisenhower passed a bill establishing the Highway Trust Fund.  The law directed federal fuel tax to the fund to be used exclusively for highway construction and maintenance.  Over the years both Democratic and Republican presidents have increased the tax to 18.4 cents per gallon on gasoline and 24.4 cents per gallon on diesel fuel.

 

In 2008 the fund required an additional $8 billion dollars from general revenue funds to cover shortages brought about by the recession of that year and higher gas prices.  It seems that from that year on there has been less driving and more efficient vehicles that used less gas for greater mileage.  Since 2008 Congress has authorized $65 billion from the General Fund of the U.S. Treasury to keep the Trust Fund solvent.  These monies go to all the individual states in the form of block grants and are more or less matched by state spending.

 

The Highway Trust Fund is only authorized to spend money through November 20, 2015.  In August of 2015 the Senate passed a six year highway bill.  The Republican House of Representatives ignored the bill and went into recess.  During the summer a short term $8 billion spending bill was passed by the House extending infrastructure spending until November 20th. Early in November the House passed a six year highway bill which they only funded for three years by a bipartisan vote of 363 to 64.  It was the new Speaker, Paul Ryan’s, first major accomplishment.  The bill has to be reconciled in a Conference Committee with the Senate or voted on by that body as it stands and signed by the President before it becomes law.  One comment on the bill is that it is a six year bill that is only funded for three years.

 

The basic problem with this bill, as with most bills dealing with the infrastructure is that the funding is mostly inadequate; it helps more or less maintain the system but it is never adequate to bring about the fully needed repairs or replacement.  If we take Mississippi as our example then in 2012, a national report found that that state had an estimated $30 billion in highway and bridge needs but had at most $15.3 billion to meet these expenses.  This is true for every single state in the nation.

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Today public spending on infrastructure has fallen to its lowest level since 1947.  The U.S. which used to have the finest infrastructure in the world is now ranked 16th according to the World Economic Forum.  It is behind Iceland, Spain, Portugal and the United Arab Emirates.  Many large corporations like Caterpillar and GE have complained that it’s hurting their ability to compete abroad.  The conservative U.S. Chamber of Commerce at a Senate hearing early in 2015 expressed strong business support for raising the gasoline tax.

 

In addition to roads and bridges and the gas tax there is aviation.  Throughout the United States there is a shortage of airport runways and gates along outmoded air traffic control systems.  These have made U.S. air travel the most congested in the world.

 

Around the industrial world there are over 14,000 miles of high speed railroads operating around the world but none in the United States.  In Chicago it can take a freight train nearly as long to go across the city as it would take a high speed train to go from Chicago to Los Angeles.

 

In New Jersey there is an old railroad bridge, the Portal Bridge, going over the Hackensack River that was built in 1910.  It gets almost 500 trains a day and is one of the busiest bridges in the country.  The bridge was based upon a design from the 1840s and was obsolete shortly after it was completed over 100 year ago.  It is a swinging bridge that needs to be opened several times a week to allow river traffic to pass.  Its major problem is that it doesn’t always lock when it is swung back and rail traffic can back up infinitely in both directions while is being made usable again.  The bridge has to be replaced.  The project would cost just under a billion dollars.  A new bridge was designed two years ago in 2013.  Everyone agrees it has to be replaced but there is no consensus or political support from Congress to raise the necessary funds.  Its eventual failure could stop traffic in the Northeast.

 

As far as the seaports go we now have a new generation of large cargo ships that will be going through an expanded Panama Canal in another year or so.  On the East coast only two ports of the 14 major ports will be dredged deep enough to accommodate these ships.  Do we then limit all foreign traffic to these two ports?  And if we do then how rapidly can these ships be unloaded and reloaded?

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We have mostly looked at forms of transportation that are a major part of the infrastructure but far from all of it.  There is also maintaining drinking water quality throughout the nation, dams and dikes that are essentially obsolete, extension of power grids, modernizing public school laboratories and structures, plus a number of other factors that allow the society to function.

 

In the winter of 2014 – 2015 a section of the national power grid froze and ceased functioning.  A section of this country was one step away from losing electric power.  We have not been that lucky in the following year.  A section of the northwest, Washington State, lost power during a period of freeze.  Conditions could still get worse in the near future.  Do we have to wait for additional crises before any action is taken?

 

Actions will have to occur at some point.  Now is considered a good time since interest rates are low and estimates indicate that these projects would generally pay for themselves in the near future.  This will be increased employment, there will be more productivity, a greater GDP, and more collected in taxes on every level of government.

 

Some of it can be done by having local and state governments team up with the private sector.  There are currently such projects in 33 states.  These arrangements are called P3s (public-private partnerships).  They are popular abroad.  But their financial effect is limited according to the extent of the infrastructure needs.  Only Congressional action can bring about substantial improvement.

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The two major weapons that the Federal Government has to fight economic recession or a major depression are Fiscal Policy and Monetary Policy.  Fiscal Policy is carried out by the Congress and Monetary Policy is done by the Federal Reserve.  Since 2011, when the Republicans gained control of the House of Representatives, there has been no real Fiscal Policy.  If anything, with one exception in late 2015, Congress has largely ignored this responsibility.  The Federal Reserve, under the leadership of its former Chairman, Ben Bernanke, with support from the President, had used creative Monetary Policy to move the country toward economic recovery from the late 2008 Real Estate Crash.  The country is still in the process of recovering.

In March 2012 the Treasury Department published, “A New Economic Analysis of Infrastructure Investment.”  This multipage document explained all the advantages of infrastructure investment, also detailing programs the President was trying to initiate.  From what I understand the issue was never even raised in the Republican dominated House of Representatives.

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In the 19th Century being a Congressman was a part time job.  The Congress met for only a few months and passed all the necessary laws for the year and then adjourned.  The President spent the entire year running the country but Congress only met for a few months.  The House of Representatives have again reached that point except that they have stretched it out over the entire year.

 

The current schedule calls for the House of Representatives to meet for 111 days over their fiscal year.  They work three days a week and take a four day weekend.  They have extended all their holiday breaks by half again as many days as they used to take.  And for this they are paid $170,000 per year.  All this at a time when the nation is seething in problems, many of which they have no time and probably no inclination to consider.

 

The new Speaker, Paul Ryan, has a bed in his office and lives there the short week he is in Washington and, from what I understand, spends his four day weekends home in Wisconsin with his wife and young children.  That was part of his agreement in becoming Speaker.  The rest was to pacify the conservative elements in his party.

 

What will happen in Congress is anybody’s guess.  I would suppose the country is stuck with these Republican majorities for another full year.  How much will this Congress achieve?  To me that’s an interesting and frightening question.  I don’t expect much.

 

What happens in the 2016 Presidential Election is up to the public voters, whose vote has not been suppressed in Republican dominated states.  We know in a recent Midterm Election the Democrats cast more votes for members of the House than the Republicans did but through earlier gerrymandering the Republicans were still able to maintain the majority in the House of Representatives.

 

What will the attitude of the current Congress be toward the infrastructure?  Ted Cruz and some of the other potential Republican Presidential candidates stated in their third debate that it should be the province of the states.  The states are investing less and less money into infrastructure as their other costs increase, especially their unfunded retirement costs.  Hopefully no additional major infrastructure disasters will occur during the winter of 2015 – 2016.

 

If we ask ourselves how Congress does get away with its current attitude or attitudes?  The answer is quite obvious.  This action and a number of other things Congress does is essentially invisible to the general public.  The media does not consider these items as newsworthy.  They are not really dealt with or dramatically brought before the public.  The concept of the infrastructure itself tends to be more abstract than concrete.  If something specific happens and there is a public hue and cry about it then something is quickly done to resolve the problem.  But as a small piece of information that can be dug up with some effort it is not that important.  While Congress should be concentrating on all these problems they ignore them until they are specifically brought to their attention.  Basically the thinking is that the country has done well and will continue to do so if left alone.

 

An example of this was sequestration, a law passed two years ago to cut government spending across the board.  An immediate result was enhanced waiting time at all the airports as the number of air controllers was immediately cut back.  The complaints were loud and vociferous.  Within a day or so

Seal of the United States Department of the Tr...

Seal of the United States Department of the Treasury (Photo credit: Wikipedia)

Congress had passed a law exempting the air traffic controllers from sequestration.  The military in late 2015 had reached a point where its efficiency was drastically effected by sequester cuts.  This problem was resolved when the debt limit was raised.  Refunding the military became part of that deal. Generally once members of the public are inconvenienced or the change will obviously effect the country change is quickly brought about.  But until that time nothing is done.  In a sense we are waiting for obvious crisis to occur before positive change is brought about on parts of the infrastructure.

 

 

 

 

 

The Weiner Component #97 – Legislative Gridlock: The Non-Functioning of the United States Congress

Traditionally over the 200 and some year old history of the United States there have been two major political parties; sometimes for a short period of time there has been a third or even a fourth one. There has even been two very short periods when there was only one political party.   Interestingly the founding fathers never visualized such a thing.

These political parties have served as a check upon each other, sometimes working together and sometimes against each other. Their purpose has been to further the growth of the United States.

Today we are facing a strange situation, two major political parties, but so far apart on the political spectrum that they cannot even communicate one with the other.

The Republicans are controlled by the far right element (the Tea Party) and by the evangelicals, people who believe in a literal interpretation of the Bible. To them compromise consists of the other side giving in. Recently one of their members in the House of Representatives stated on conservative talk radio about there being a “War Against Whites” by the President, Blacks, and all other minorities. Even the conservative woman who was hosting the program was shocked by the statement.

It would seem that once a member of the far right gets elected to political office he becomes directly inspired by God. Without any awareness of economics or how the Federal Government works he has instant inspiration on what should or shouldn’t be done. Innately he knows he is right and everyone else is wrong. His idea of compromise is having the other side, generally the Democrats, accept his position.

How do you reason with a person like this? He will see a doctor and largely follow his directions but he is anti-scientific, knowing the scientists are wrong about most of their discoveries. He is also anti-intellectual, knowing what is right; reason and logic to him are instruments of the devil, used to trick honest people.

An example of scientific knowledge would be the beliefs of former Congressman, Todd Akin who believed that rape cannot lead to pregnancy. He stated that the body of a raped woman shut down during the act and she couldn’t conceive. Then following his fallacious reasoning: any woman who became pregnant during a forced sexual encounter had not been legitimately raped. Or one can follow the beliefs of another former Congressman, Richard Murdock, who knew that in a case of rape in which the woman conceived, God wanted her to have the child. To me and I suspect to a large percentage of the population, it is rather presumptuous for anyone to deliver direct messages from God.

The modern day far-right Republicans, or for that matter it would seem, the entire Republican Party seem to hold to these levels of non-intellectualism. The current House of Representatives and filibustering Senate, the 112th Congress, has done less to serve the needs of the country than any other Congress in the history of the United States.

If one looks at the placards held up by many members of the Tea Party, one of their major statements deals with the concept of the less government the better. One of their major goals since 2011, when they gained control of the House of Representatives, has been to shrink the Federal Government. And in this they have been largely successful. They are very good at not taking action on needed problems like bringing the early 20th Century infrastructure into the 21st Century, unemployment, the immigration problem, the young refugee dilemma, and climate change, to name just some of the problems this country needs that Congress should fix. Incidentally this also includes filibustering necessary presidential appointments like ambassadors to Russia and other important nations that do not presently have ambassadors.

If the House of Representatives were to authorize the President to utilize fiscal policy; that is, just begin the process of modernizing the infrastructure of the United States, we would end the unemployment problem throughout the country and stop having emergences whenever a part of the system fails. This happened recently in Los Angeles where a hundred year old system of underground water pipes collapsed causing extensive damage. We also faced a situation in the winter of 2013-2014 where extreme cold froze coal reserves so that they could not be used to generate electricity over part of the central United States. Luckily they were able to shift power from other parts of the grid. They may not be that lucky next time.

According to the majority of economists this country could reach a high level of prosperity for practically all of its population throughout the 21st Century. The poor could earn enough to live properly, the middle class could grow and increase their level of prosperity, and the rich could get richer. All it would take for this to happen is for Congress, particularly the House of Representatives to properly exercise their responsibilities. Will this occur? That depends upon the Midterm Election of 2014. If the Republicans maintain control of the House and they maintain 41 or more votes in the Senate the gridlock will remain for at least two more years. It will take an overwhelming majority of Districts voting for the Democratic candidates and a small number of additional Democratic Senators for the legislature to be able to pass progressive laws that would turn this country around.

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In 1944 Franklin Delano Roosevelt was elected for the fourth time as President of the United States. Within a year he was dead and Harry S. Truman, his Vice-President, had succeeded him as the 33rd President of the United States. In 1948 Truman ran for the presidency on his own. He was perceived by many as a loser. The Republican candidate, Thomas E. Dewey, was expected by all the experts and pole-takers to easily beat Truman. Many Republicans announced that they expected to do away with most of the remnants of the New Deal shortly after the election.

Prior to the election President Truman recalled Congress, which had adjourned earlier, to a special session in order to pass legislation that he felt was badly needed by the country. The returning Congress did essentially nothing; and President Truman named them “The Do Nothing Congress.” He and the Democrats ran their campaign against the “Do Nothing Congress.”

The presidential election of 1948 is considered by many historians as the greatest election upset in American history. Just about every prediction and poll indicated that the incumbent President, Harry S. Truman, would be defeated by the Republican candidate, Thomas E. Dewey. Truman won. Both Houses of Congress acquired Democratic majorities.

While the 2014 Election is not a presidential one, it still represents a similar opportunity to the 1948 Election. In fact, the 2014 Congress has passed far less bills than that of the 1948 Congress. If the President and the Democrats in both Houses of Congress were to propose a series of needed reform legislation in September when the vacationing Republicans return to Congress and continually verbally challenge the Republicans they could get similar results with 1948. However shortly after returning from their September vacation and doing almost nothing, except authorize the President to bomb ISIS in Iraq and Syria, the House voted to take another break until after the November election.

One of the major problems faced by this Congress was the fact that the President and the Democrats in Congress proposed legislation and then when it was filibustered in the Senate and not even considered in the House. Also the Republicans never ceased verbally attacking both the President and the Democrats largely for problems they themselves caused.

What the Republican House of Representatives has done in September, when their members returned to Congress, was to again take up the issue of Benghazi for the fourth or fifth time in order to again attempt to discredit President Barak Obama and Hillary Clinton. This led nowhere and did nothing. They ignored issues like war against ISIS, but did approve bombing ISIS in Iraq and Syria. They are now busy, back on vacation, trying to get reelected so that for two more years they can continue the gridlock and blame it on President Obama and the Democrats. The Republicans approved the first step in a war against a terrorist group but avoided approving a declaration of war.

The country is currently in a sad state. We are engaged in the first stage of a war without Congressional approval, the infrastructure of the United States is continually getting older and less efficient and there are enumerable social and economic problems that need to be resolved. The inept Republican members of the House and Senate are campaigning to get reelected. The country is in deep trouble.

 

The Weiner Component #94 – Consumption Equals Production

Comparison of real GDP using BEA Deflator vs r...

Comparison of real GDP using BEA Deflator vs real GDP using Money Supply (Photo credit: Wikipedia)

Much has been stated and written during the 20th Century about the production of goods, about how production brings about the consumption of a particular product, there are theories about how a finished good will find its own market.

How valid are these beliefs? If the product or products are highly desired as those produced by a company like Apple then the theory would seem to be valid. Apple, while not a monopoly, produces unique items. But if the product is an automobile like a Ford, Chrysler, Volkswagen, or Honda then the theory is limited. First off there are a number of national and international companies competing for the sale of their product. Automobiles are expensive items. Only a certain number is needed on the market or can be afforded; and these can be new or used. If a seemingly endless amount are produced by the assorted companies then at some point the price will decrease and will continue to do so until the cost of producing the vehicle could be greater than the price for which it can be sold. What we have here is a question of demand and supply, not a theory of production; and even that is an anomaly because supply is engendered by demand.

The term supply and demand is actually the opposite of what it should be: Demand determines Supply. An entrepreneur will produce and market virtually any product from which he can make a profit. He is, after all, in the business of making money; profit is his major goal as an entrepreneur.

It would seem that the ability to purchase, having the funds to pay for goods and services, determines the extent of the production of wealth. After all free access of money determines the production of all goods and services.

In the period leading up to the Housing Bubble of 2008 a goodly percentage of homeowners used their homes as bank accounts, freely remortgaging again and again, in order to acquire whatever they wanted. There was essentially full employment and everyone was doing well, that is both consumers and producers. When the bubble exploded, because of the abuse of the banks, and housing values collapsed like lead weights many consumers were suddenly left underwater, owing more on their homes than they were worth. Consumption of both goods and services came to screeching halt and the economy tanked. There was suddenly massive unemployment. Generally outside of absolute necessities the public could not afford to consume and we were headed for a massive depression which the federal government was able to forestall by massive loans to some industries.

What happened here was that consumption of goods and services stopped when the money supply dried-up. It was the massive sudden termination of consumption that brought about the extent of the crash. Limited consumption had engendered what was largely the end of a production boom and unemployment suddenly became massive.

What suddenly happened in the economy was that consumption determined production. The ability of people to freely spend money had suddenly ended and unemployment almost instantly rose to phenomenal heights. The same people who could no longer spend were those who mainly suffered from the lack of spending. An interesting note of irony!

Money, currency was and is a tool issued by the government of the nation. It has no intrinsic value and can be freely issued by the central government. All that is required for an additional release of this paper is for the government to print it and issue it.

The problem is that if too much of this paper is released into the general society, if the people have more currency than the amount of goods and services that can be produced then the cost of the materials that can be produced within the society will be bid up and mad inflation can be the result. If, on the other hand there is too little money in circulation the public will be limited in what they can buy and a recession and large-scale unemployment will result. The government, in issuing currency has to keep a constant balance between these two positions.

The basic problem or problems here is that the government has to keep a balance and distribute this money, the national income, on the widest possible level throughout the society for maximum demand.

The principle here is that Demand Equals Production. And for maximum demand to occur the money, the national income, must be distributed throughout the entire society.

Unfortunately what is currently happening is the opposite of what should be occurring. Since 2009 a greater and greater share of the national income is and has been moving up to the upper twenty percent of the society. They are currently earning far more than they can possibly spend and their surplus funds in the millions are being stored while the bottom twenty percent is getting less and less of the national income, and the middle class is, in most cases, just barely maintaining itself or just about shrinking in size. There has been a redistribution of income continually going on.

In order for the economy to grow and for everyone to reach a level of prosperity the federal government has to take control of the national income and widen its distribution to include the entire economy. One way this can be done is through tax and entitlement policies. Another way would be by fiscal policies, Congress passing legislation to upgrade the infrastructure of the United States and bring it into the 21st Century. Of course a combination of the two would be even more effective.

The 2014 Midterm Election will give the country an opportunity to decide in what direction it wants to go for the next two years: with the Republicans toward continued gridlock or with the Democrats attempting to move toward fiscal policy, possible tax reform, and toward full employment.

The Republican conservatives who represent the well-to-do CEOs and successful entrepreneurs are generally representing congressional gridlock. They don’t want any changes in the economic system. But if they were to look closely at the system they would discover that their economic base is slowly shrinking. As more and more people are slowly being forced from the middle class to the lower class their ability to consume goods and services is slowly also shrinking. As the percentage of the poor goes from 20% to 22% to 25% to 30% their shrinking incomes will be able to buy less of the goods and services this society is capable of producing and the GDP will decrease at a greater rate than these people’s incomes. The profits possible will also shrink and so will the incomes of the upper 20%.

In essence these people are contributing millions of dollars in political elections to support an economic system that in the long run will significantly reduce their profits and shrink the GDP.

If they were to reverse their positions and support the Democratic positions of fiscal spending and reform of the tax system then they would be engendering a phenomenal growth in the GDP which, in turn, would massively increase their profits and incomes. By fairly paying taxes and encouraging the Federal Government to bring the infrastructure up to standards in the 21st Century the upper 20th percent could multitudinously increase their profits and income far beyond what they would be paying in increased taxes.

It’s a wonderful piece of irony, having the upper echelon of our society fighting tooth-and-nail against their own long-term economic interests.

English: Changes in US Money supply based on F...

English: Changes in US Money supply based on Federal Reserve historical data. Source code is in File:Components of US Money supply.svg (Photo credit: Wikipedia)

 

 

 

 

 

The Weiner Component #85 – Health Care & the American Public

English: President Barack Obama speaks to a jo...

English: President Barack Obama speaks to a joint session of Congress regarding health care reform (Photo credit: Wikipedia)

Tea Party rally to stop the 2010 health care r...

Tea Party rally to stop the 2010 health care reform bill in St. Paul, Minnesota The Tea Party people held a rally calling for the health care reform bill currently being considered in congress to be stopped. Republican U.S. representative Michele Bachmann was the guest speaker. The crowd was filled with signs and stickers for Bachmann and other Republican candidates. Signs read: Abort healthcare Abort Obama Save Our Country Republicans Weed Out Your Progressives (Photo credit: Wikipedia)

Most industrial nations in the world today have some form of universal health care sponsored by their government and paid for by taxes. One of the few exceptions is the United States where it is and has been strongly opposed by the Republicans in Congress and in some state legislatures.

Today, in most nations, virtually everyone needs some form of health care. Those who are employed by reasonably sized companies and up generally have some form of medical insurance. The members of Congress and the state governments have some of the best plans available. The employed middle and upper classes are generally nicely covered. The poor and those working for low wages do not generally have medical coverage. Therefore those throughout the United States with no health insurance would be most of the bottom 20% of the population, around 18 to 20 million people.

Today everyone needs at least yearly checkups by the medical profession. There are too many people walking around with coughs and with what they consider minor problems. These people cannot afford medical treatment until their malady reaches a critical stage and they are forced to go to emergency care at a local hospital. Many of these emergencies could have been avoided with proper medical treatment. A number of these emergencies will end up with unnecessary deaths; treatment was too late.

How do we know this? Twenty percent of the people living in the poverty group will die ten years sooner than those living in middle or upper class groups.

I have a malady which is not uncommon and come to many in the older population. Without constant monitoring and treatment I would have died several years ago. With treatment I will live for another ten to twenty years.

William Jefferson Clinton was elected to the presidency of the United States in 1992. He served as 42 President from January 20, 1993 to January 20, 2001. His wife, Hillary Rodham Clinton led a group of Congressmen in the development of a National Health Care Reform Bill. Even though the Democrats were the majority party in both Houses of Congress for the first two years of the Clinton Administration the Republican Party was able to defeat the bill. Their slogan, which was eminently successful, was: “There has to be a better way.” The “Better Way” was no health reform. We seem to be in a similar position today except that the bill was passed into law four years ago and is more or less in operation today with the Republicans still demanding its extraction.

The Republicans are claiming that they will have a better and more comprehensible bill. But they have presented nothing so far. The irony of the situation is that the basic medical plan was developed by a far-right Republican think tank and first put into operation in Massachusetts by its then Republican governor, Mitt Romney.

The system is run by private business with the government setting the rules and supplying much of the money. Unlike what exists in other countries this system is largely run by private enterprise. Why, then, are the Republicans so against it? Could it be because it was inaugurated by a black president

The major problem which is being faced in a number of Republican run states is that, because of a Supreme Court decision, the governor of each state can accept or reject total medical coverage for all his citizens within his borders. The Federal Government will pay the total cost of this plan for the first three years. This is money that these states have already paid in taxes that they will be getting back. A number of Republican governors have refused to accept this expansion of Medicare for their poor citizens who have no medical coverage.

Why are they doing this? Are they standing on principle? These governors and their Republican legislators have very comprehensive coverage for themselves. Yet they are refusing it to the poor within their respective states. Rick Perry, the governor of Texas is doing this as well as a number of others. An argument can be made as to how this refusal will be hurting not only the people who will still have no medical coverage but also the economics of the respective states.

I understand that many if not most of these men are religious, good white, fundamentalist Christians. They believe in Judgment Day and the world to come. If they’re right, then they’ll have to explain why they breached the Holy Commandment: “Thou shalt not kill,” and take the punishment for that action.

 

 

Republican Elephant & Democratic Donkey - 3D Icons

 

The Weiner Component #84 – The Republicans & the American Infastructure

Franklin D. Roosevelt

Official portrait of United States House Speak...

The purpose of Congress in the United States is to serve the people, not to play politics. The Republicans in Congress are not carrying out their proper function. The American people deserve better. Either the Republican Congressmen have no knowledge of Macroeconomics or they are plain vicious, caring only for themselves and the welfare of heir party.

John Boehner, the Speaker of the House of Representatives has come out with statements to the effect that Harry Reed and the Senate Democrats have not picked up any of the job creation bills that the House of Representatives have passed. The question here is what job creation bills? The only ones that come to mind are the fifty bills they passed to do away with Affordable Health Care. They claim that this law is a job busting one. How, they never say.

The fact is that eight million plus people, many who have never before been able to afford medical insurance, now have health coverage. If anything, Obamacare has created more jobs in the medical field. Just the paper work involved would require many more clerks

I am reminded of one of President Roosevelt’s 1936 campaign speeches where he stated sarcastically the Republican position at that time. The Republicans wanted to be elected so they could administer the New Deal. They said, in effect, that they would do it better and there would be more of it. Boehner wants to get rid of Obamacare so they can pass a bill creating Boehner Care that would be better and include more medical coverage for everyone. Of course there are no details of what this bill would contain. Probably they would be as efficient in passing it as they are in solving the illegal immigrant problem or a minimum wage bill.

In 1929 it was Republican Administrations that brought the Great Depression into being. In 2008 it was also Republicans who had brought the Real Estate Bubble into existence. Now they are going to solve this problem by bringing back conditions that brought this situation about.

How do we know this? In the 2012 Presidential Election Mitt Romney, the Republican candidate, promulgated this plan. It was the Republican Platform. They acted as though there had never been an economic crash in 2008 during the Bush Republican Administration.

Everything the House of Representatives has done since it gained a Republican majority in 2011 has been aimed at exacerbating the conditions brought about by the Real Estate Disaster. They have not passed one jobs bill since that time. There has been no fiscal policy. Instead the House has shrunken government services, particularly to the poor, starting a chain reaction which forced state governments to do away with multitudes of state jobs. The Republicans have been hypocrites, saying one thing and doing the opposite. Paul Ryan has stated, in effect, that he would not feed a hungry person because the dependence would take his dignity away from him. Really!

What we need are programs to get rid of hungry, homeless people by providing jobs for them. Up to this point when we thought of the infrastructure of this country we believed how upgrading it would decrease unemployment in the United States and help bring prosperity to all its people. Isn’t it time to consider the actual needs of the nation? Going into the 21st Century with a 20th Century Infrastructure is just plain dumb. Most of our infrastructure was built well over fifty years ago and is outdated or inadequate.

Also, whether because of man’s abuses or for reason of natural changing conditions the weather patterns have and are changing and bringing phenomenal strain upon these structures. In the winter of 2013—2014 there were some radical changes in weather conditions within some areas of the United States. These changes or others like them, whether caused by natural climate changes or by pollution, could become normal in the future.

Temperatures dropped to 16 below zero in Chicago, during early January and set record lows across the eastern U.S. A fifth of all power generating capacity in a grid serving 50 million people went suddenly offline, as coal piles froze. Sensitive electrical equipment went haywire and utility operators had serious problems finding enough natural gas to keep power plants operating. The wholesale price of electricity jumped to more than forty-times its normal rate. The retail price became insane. One customer received a bill for $1,250 for January that was eventually reduced to $750. Another one with a $654 bill got no relief.

The problem with the cost of the electricity was the result of an antiquated grid and the pacific vortex, the cold air mass that settled over the nation. It exposed a growing fragility in the U.S. electricity grid. We need a modernization of the system or we are open to facing all sorts of emergencies in the near future.

The infrastructure is the basic facilities, services, and instillations needed for the proper functioning of the nation, such as communications and transportation systems, water and power lines, and public institutions including schools, post offices, and other needed public entities.

In April tornados hit sections of the central United States. Billions of dollars in property was damaged and destroyed. People were killed. The basic problem here is that the warning system is only fifteen minutes before the storm strikes. We have the knowledge and technology to do far better than that. Cities susceptible to these storms all need tornado warning systems and storm shelters. Since damage seems to be higher in mobile home parks these all need storm shelters. The cost of installing all this would not be that great and the savings in human lives would most likely be considerable.

Both urban and rural highways need constant maintenance. While constant construction does go on in some areas this does not occur. Also many highways are old, built decades ago, containing numerous pot holes and insufficient lanes. The population using them has increased considerably and improvements, if any, have been minimal. It’s time for a revamping of our nation’s roads and highways. We need a modern transportation system to supply the needs of today’s citizenry and to allow for rapid and easy movement of goods and people.

Public schools, both primary and secondary, in many cases were built during the first half of the 20th Century. They need to be refurbished or in some cases rebuilt so they can function as modern educational institutions. State colleges and universities also, in many cases, are dated structures. They need to be enlarged and modernized in order to serve the needs of today’s students.

Municipal, state, and federal buildings, proper and adequately built aqueducts to carry clean water to all the urban and rural areas of the country are needed. Most bridges in the country are over fifty years old. Some are in danger of collapsing; a section of one did a few years ago dropping several automobiles into the river. Luckily no one died.

At the rate we’re going most industrial nations will bypass the United States in their infrastructures.  Do we go forward with modernization or patch after each disaster?

 

 

 

 

The Weiner Component #70 – Intentions of the Framers of the Constitution

English: First page of Constitution of the Uni...

One of the major objects, if not the major object, of the framers of the Constitution was to create a government of the majority with protections for the minorities.  A true Democracy is supposed to express the will of the majority.  The major reason for education in our society was to create a population capable of reasoning and therefore able to elect the best people capable of representing them.

Today instead the object of government as applied by the far right and the evangelicals is to create a government where they, the minority, rule and set the standards for the majority.  Through the use of seemingly endless amounts of money in advertising, gerrymandering, and outright prefabrication they have been able sway elections to give themselves the power to impede necessary reforms and cause untold misery in the nation.

The Republican Party has been vociferously attacking Affordable Health Care (Obama Care) since they were able to gain control of the House of Representatives in 2011.  With the upcoming Midterm Election in November of 2014 the leadership of the Party has promised to make that a major issue, destroying Obama Care.

In a March Special Election in Florida, in an overwhelmingly Republican District, the Republican candidate just barely won the election.  Interestingly he treated his victory as one in which he totally trashed the Democratic candidate and the overall bulk of the population in his District voted to get rid of Obama Care.  The reasoning by the candidate and the party seems to be fallacious.  Presumably the new basis of the November Election in 2014 will be to elect Republicans so they can do away with Obama Care.

This seems to be in the opinion of many of that group a way to regain control of Congress.  The concept is fascinating since the entire concept of Obama Care was originally developed by the Heritage Foundation, a Republican Think Tank, and initially set up in Massachusetts under Republican Governor Mitt Romney.  It would seem that the reason for attacking Obama Care is to gain political power In Washington, D.C.

Interestingly, if we take the different parts of Obama Care and discuss them with the general public we find that they like the parts.  For example, keeping a child on their parents medical plan until he or she is 26 if the youngster is going to college, insurance companies not being able to reject people because of a prior condition, overall lower insurance rates for most people, no maximum limit in terms of what the insurance company has to spend on any condition, etc., etc.  But then if you ask them what they think about Obama Care the answer is that they don’t like it.

What seems to have happened is that the Republican prefabrications, like death panels and other nonsensical statements, which the Republicans have repeated over and over again, have, more or less, taken hold.  A good percentage of the people do not associate Affordable Health Care with the benefits it’s so far provided.  It can also be stated that the Democrats have not provided enough positive information to the public compared to the Republicans who have given redundantly endless negative statements.

In addition to using Obama Care as a means of gaining political power the wealthy Republicans like the billionaire Libertarian Koch Brothers have begun, through groups they fund, utilizing television and other forms of advertising as early as March for the oncoming November Election.  The probability is that billions will be spent on the Midterm Election.  And most of this money will be spent by the Republicans attempting to buy power by trying to gain control of the Senate and keeping control of the House of Representatives.  This is also true for state elections.

Will they gain control?  An interesting question!  We’ll have to wait and see.  Can the American voter be bought by propaganda and go against his/her own economic interests?

If the Republicans are successful the country will have total gridlock for 2015 and 2016.  They will not have a supermajority in the Senate and the Democrats will do what they, the Republicans, have done from 2009 on, filibuster the bills they are against and the President will veto the bills he is against.  They might try to impeach him as they did President Clinton; but, I suspect, they will have a problem doing so.  Of course they might be able to push through some strange laws, that the President would consider unconstitutional and break, as they did in 1868 with President Andrew Johnson.  But that did not effectively work then even with supermajorities in both Houses of Congress.

If the Republicans were to gain control of Congress in 2015 they would have to find positive reasons for running the country and they would also have to be able to work with the President.  At this point none of this seems possible.  All they have done since 2011 has been to impede all programs for which Obama could claim credit.  They haven’t been for anything except lowering taxes for corporations and the upper 1%.  The Republicans have done an outstanding job of keeping the country in a recession, attacking woman’s rights, and limiting benefits in entitlement programs for the poor and needy.  Paul Ryan, for example, has defined sloth as a racial thing.  It will be interesting to see what happens.

 

 

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The Weiner Component #67 – Monetary & Fiscal Policy & The National Debt

During the late 18th Century, when the United States first came into existence and for the majority of the 19th Century, the U.S. Government followed a policy of laissez faire; with the exception of import duties, used to run the government, they kept hands off all economic activity within the nation.  Toward the end of the 19th Century, with the growth of cities, rapid industrialization and the emergence of monopolies, society became too complicated to be left alone by the Federal Government.  State and   National regulations began to come about attempting to control the economic ravages brought about by the moneyed classes which had and continued to lead to miserable conditions for the masses, and included both recessions and depressions.

In addition to assorted laws regulating conditions with the society in 1913 the Federal Government created the Federal Reserve as a semi-autonomous agency whose mission was to control the National Cash Flow, the amount of money available throughout the economy.  They were to add or subtract cash as needed to keep economic growth regular and avoid rapid upturns or downturns in the economy.

This became one of the major tools in attempting to control economic conditions within the nation.  Were they always successful in what they did?  The answer is obviously, No.  Witness the Great Depression of 1929 and the Real Estate Debacle of 2008.

The other major tool which the Federal Government had/has was Fiscal Policy.  This is the power to spend money by passing a law.  Congress, with the signature of the President can appropriate money for any purpose it deems necessary.  This was done during the Great Depression and enabled Roosevelt to propagate his New Deal and later to pay for World War II.  Congress, at the time, spent much more money than it took in in taxes.  Eisenhower did the same thing in the 1950s, both to build a national highway system across the United States and to fight the Korean War (police action).  This use of fiscal policy has been used over the years of our history to do numerous things, generally for the benefit of the entire country.

During the Great Depression the economist, John Maynard Keynes, promulgated what is called Keynesian Economics, which stated that during periods of economic contraction the government has to spend more money than it takes in in taxes and during periods of expansion or growth it can balance that by taking in more money than it spends.  He is considered the progenitor of Macroeconomics.

While this is not always true, generally because of war or police actions, still, historically, the economy has grown to the point of decreasing the percentage of debt in relation to the Gross Domestic Product, the amount of wealth produced in one fiscal year.  The National Debt has never been a problem in our history for future generations.

It should be noted that the Debt reached its astronomical level beginning with the Administration of Ronald Reagan and his Star Wars policy.  It went from 848 billion in 1981 to 2.698 trillion by 1989, a 218% increase.  Then it continued to zoom with George H.W. Bush and his Desert Storm operation increasing another 55% to 4.188 trillion.  It increased another 37% with Bill Clinton and was actually reduced during his eighth year in office.  The Nation Debt took off like a high flying rocket with the Administration of George W Bush and his policy of two wars, one in Afghanistan and the other in Iraq, while at the same time he lowered taxes.  It rose 86% to 5.778 trillion.  With Barak Obama the amount of the Debt initially increased but by the end of 2013 reached a surplus.  The National Debt grew voluminously under Republican presidents and tended to decrease under Democratic Presidents after rising somewhat.

The National Debt is currently at about 17.3 trillion dollars.  Is this too high?  Is this amount endangering the country in any way?

It should be noted that the nation began in debt.  During the Revolutionary War the Continental Congress issued paper money, called Continentals, to pay its debts.  The value of this money varied depending on how well we were doing in the war at the time; it never commanded full face value.  The British paid for everything in gold. After the war the new government, under the first Secretary of the Treasury, Alexander Hamilton, redeemed this paper for full face value.  There had been speculation with the Continentals and a number of people, not the original possessors of the funds, made a fortune on this.  They had bought up the currency for pennies on the dollar. (See Charles Beard, The Economic Interpretation of the Constitution.)

Jefferson hated the debt and tried to get rid of it, but under his presidency the United States got involved in an undeclared war with the Barbary Pirates, the North African nations along the Mediterranean.  Other presidents had similar occurrences, facing military crises not of their making.  There have been a few short periods over our history when there was no National Debt; but generally the United States has always had one.  The question in terms of today is: Does the current debt endanger the welfare of the nation?

The National Debt consists of two parts, one public and one private.  The public part of the debt is owned in various ways by the Federal Government, the private section is money borrowed for short to long periods of time by individuals, foreign nations, and other entities.

The Federal Government admits to owning, through various government agencies like Social Security and Medicare at least 40% of its own debt.  Social Security, for example, holds well over 1 ½ trillion dollars in debt paper.  This was several years ago.  Today, I would estimate, the Federal Government holds 60 to 70% of its own debt.  I would be inclined to quote the higher figure.

During the last quarter of 2013 the Federal Government collected more in taxes than it spent.  There was a surplus.  This would indicated that the GDP has grown to a point where it is or can handle the National Debt and in all probability very gradually decrease it.

It should also be noted that since 2011 when the Republican majority first took over the House of Representatives there has been no fiscal policy.  If anything Congress has reduced government spending to the point of shrinking the government and entitlement spending.  This process together with the shrinkage of State governments because of decreased taxes has phenomenally decreased government employment on all levels and exacerbated the 2008 Recession.  What has saved the country from another Great Depression has been imaginative Monetary Policy.

Had there been Fiscal Policy since 2011 unemployment would have dropped to about 3% or less and the Gross Domestic Product would have been far higher than it is.  Virtually everyone in the country would have been better off.

With Republican help we are doing a good job of holding back economic growth and not bringing the United States solidly into the 21st Century.

 

 

 

 

 

The Weiner Component #66 – Macroeconomics & the GDP

Imagine a giant caldron or pot as high and as large as the tallest building you’ve ever seen,

The western front of the United States Capitol...

The western front of the United States Capitol. The Capitol serves as the seat of government for the United States Congress, the legislative branch of the U.S. federal government. It is located in Washington, D.C., on top of Capitol Hill at the east end of the National Mall. The building is marked by its central dome above a rotunda and two wings. It is an exemplar of the Neoclassical architecture style. (Photo credit: Wikipedia)

filled[ with money, paper bills, with over 17 trillion dollars in it.  This is the Gross Domestic Product, the GDP, the amount of wealth produced in one year in the United States.  It represents the monetary value of all the goods and services produced and consumed in a twelve month period.  The money is a paper means of exchanging all this wealth and productivity, all the goods and services produced in one fiscal year.  It has no real value except as a token of transfer, goods and services for goods and services.  There is nothing behind the dollar except the word of the Federal Government.  Gold, which has a high value, cannot be used for money because there is not enough of it in existence to meet the financial needs of any of the many industrial nations.

The real wealth is what is produced and exchanged.  The money is merely the means of exchange that rates one unit of productivity against another and is used nationally or internationally.  The currency, then, is the tool through which this system of exchange occurs.  It can be used immediately or stored in institutions like banks or credit unions and used at some point in the future.  Money can also be used as a commodity, loaned or rented out with interest for a period of time or it can be used for all sorts of investments that pay interest or dividends.  It is in every case a tool to satisfy different types of wants and needs.

To consider money as the source of wealth is to be naïve.  The amount one has through earnings or inheritance can be used as a sort of score to determine one’s level of success against that of all other people in the society.  It is a government supplied tool that allows for the productive functioning of society.

It is the responsibility of the Federal Government to keep enough of it in circulation, a constant cash flow, so that full productivity occurs.  A shortage of the money supply in the nation can cause economic recession and eventual depression.  An excess amount of money in the National Economy can bring about run-away inflation, too much money available for the goods and services produced.  The Federal Government’s task is to provide just enough for full employment and full creation of the goods and services needed for the highest possible standard of living for the entire population.

This is not easy and requires constant readjustment because, according to the U.S. Census Bureau the population of the nation is increasing at the rate of one additional person every eleven seconds.  This figure includes births, immigration, and deaths.  In 2010, the time of the last National Census, the estimated population was 308,745,536, and this was considered a low count.  While an adjustment upward was made a year later this figure was used for the apportionment of seats in the House of Representatives.

One has to keep in mind that in addition to this number the population since then has increased at the rate of 5.46 people per minute, 327.27 per hour, 7,854.55 per day, 54,981.81 per week, 2,866,911 per year, plus another 7,854 for leap years.  The money supply has to be continually increased to keep up with these ever-growing numbers or the country moves in the direction of economic constriction, unemployment, recession, and finally depression.  All this is supposed to be done by the Federal Reserve with the aid of Congress and the President.

The Federal Reserve continually monitors the economy and continually makes its adjustments through Monetary Policy.  It can strongly but not completely affect the amount and flow of currency. The other section of the Federal Government that is supposed to continually affect the level of economic prosperity in the country is Congress.  They do this through fiscal policy; passing laws that can diminish or create employment throughout the United States by either increasing or decreasing government spending.  In essence through the passage of laws they can constrict or expand the cash flow and the level of employment

If we look at the actions of the Republicans in the House of Representatives from 2011 on, when they gained control of that body, it would seem that they by their actions are working very hard to bring this country into an economic depression and not allow for any recovery from the Real Estate Debacle of 2008.  We are still, six years later at seven plus percent unemployment.  Millions of people are still not earning enough to maintain a decent standard of living.  There is growing hunger in America, that many people are not food secure.  What are the Republicans proposing and trying to push through Congress?  Massively reducing food stamp and other programs that are vital for the proper survival of fifteen or more million people.

Their version of job creation is to massively reduce Federal spending for entitlement programs while wasting twenty-five billion dollars on shutting down the Federal Government for a period of time.  If one looked for a plan to destroy the United States or make it into a third rate nation then one would do exactly what the Republicans in Congress have been and are trying to achieve, to bring a large part of the population into despair and desolation.

The Republicans are acting like the Hoover Administration did from 1929, when the Great Depression broke, until 1933, when the Roosevelt Administration came into being.  Is it an act of maliciousness or just simply economic ignorance?  They are attempting to run the country as they run or ran their household budgets.  One Tea Party Congressman stated that he understood economics because he had raised a family.  They are making money the object of value and ignoring the potential productivity of the nation.  They are actually using the principles of Microeconomics, which works well with households, businesses, and state and municipal governments but can create disaster if it is used to run an industrial nation of over 300 million people.

 


 

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The Weiner Component #63 – The State of the Union & the Republican Party

Official photographic portrait of US President...

On Tuesday, January 28, 2014, the President of the United States, Barak Obama, gave the yearly State of the Union speech.  He was positive about the nation and vowed that as far as he could he would extend numerous programs if Congress did not act.  He is the chief administrator in the country who carries out the laws.  Congress alone has the power to pass laws.

The Republican response to his speech was given by Washington State Representative Cathy Mc Morris Rogers, the 200th woman elected to the House of Representatives. The fact that she mentioned that she is the 200th woman was interesting in that women make up about 53% of the overall population of the United States.  There are 435 elected members of the House of Representatives.  Women got the right to vote in 1920 with the passage of the 19th Amendment to the Constitution.  Why is their number in Congress so low that it has taken 94 years for 200 members of their gender to be elected to Congress?  Have they been busy being pregnant and raising children since 1920?

Mrs. Rogers, as she gave her presentation, appeared to be a very nice lady.  She spoke sitting on a couch, presumably in a living room somewhere.  To a certain extent she praised President Obama stating that their goals were similar, the welfare of the American people; but their methods of achieving them differed.  She spoke about Republican plans in Congress to create more jobs, expand medical care, and generally improve conditions for the unemployed and middle class.  Her statements were general, no specifics were given.

What came to my mind from what she said were some of the statements that Republicans had made over the years.  They would achieve these ideal conditions by lowering taxes for the rich so that they could create more jobs.  According to the Speaker, John Boehner, the rich are the job creators.  The rich have gotten far richer in the last decade but we still have high unemployment.  Where are the jobs they are supposed to have created?

Nothing Cathy Morris Rogers said dealt with how to expand medical care for everyone.  She gave one example about Affordable Health Care where an individual’s rates were raised.  It was a very general group of statements.

What basically I heard in her speech was pabulum: trust us, we’ll make things better for you.  Even though the Republican in Congress have done nothing, since they gained control of the House in 2011, to improve economic conditions in the country except attach the term “Job Creating” to numerous bills that had nothing to do with jobs.  In fact Republican actions in Congress have exacerbated negative conditions in the United States to the point of worsening the economic plight of a goodly percentage of the population.

Why did the Republicans choose a woman legislator to respond to the President’s speech?  It struck me that the answer to this question was very obvious.  The Republicans have been continually accused of making a war on women.  According to Mike Huckabee, the former preacher and governor of Arkansas from 1996 to 2007, they all want the government to pay for birth control so they can have continuous sex.  The fact that birth control is a factor used by women for purposes of their own health and family planning is immaterial.

(Parenthetically, Huckabee signed a bill as Governor of Arkansas that made birth control a requirement for all female medical plans in Arkansas during his term as governor.)

The Republicans are acting as though women are incapable of making life decisions for themselves.  They have been doing this for quite a while.  They want women to pay the cost of many of their health decisions while men can freely get coverage on such sex enhancing drugs like Viagra.

In addition to all this many Republicans want an end to all abortions, even in cases of rape, incest, or the life of the mother being in danger.  The Republicans, who seem to be mostly older white males seem to see women as objects that they must control.  If this isn’t war on women I don’t know what is?

The choice of a woman, Cathy Morris Rogers, to respond to President Obama’s State of the Union speech was an attempt to demonstrate that there is no war on women.  It was supposed to bring both women and men to or back to the Republican fold.

Her speech had no real substance and it belied Republican actions in Congress since 2011.  The message she gave for the Republican Party was:

Trust us, we’ll do right by the nation.  There was no way of telling how or when.  It gave words but no actions.  The President, on the other hand, was very specific about what he will do.

The Midterm Election will be held toward the end of 2014.  By their voting the public will decide what kind of future the country will have in 2015 and 2016.  Will it be more Republican austerity or Democratic growth?

 

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