Right Versus Left - December 2009

DRW Editor: Our debate-style column experiment continues. Each author was given
200 words at a time to make their point before the other had the opportunity to respond.

GARY LAZARUS for the left
ART WAGANHEIM for the right

ART The numbers are in. Unemployment is up. The stimulus plan did not create any meaningful number of jobs. The value of the dollar is an embarrassment to the nation. And although the Gross Domestic Product(GDP) did have a positive 3rd Quarter, it was mostly from car and new home sales pushed forward by the billions of clunker dollars and first time homebuyer credits. So it appears that Obamanomics has been a resounding failure. So the question is: What would I do if I could wave a magic wand to fix the economy? We again need to make the United States the preferred place for companies to source their labor and materials rather than seeing them outsource to less expensive countries. We can do that by following the model of Ireland and most former Soviet states which slashed their corporate taxes to attract
business investment. We also need to vote down Obama’s proposed carbon Cap & Tax program which will only chase more business overseas. And, as politically incorrect as it may sound, we need to get government out of many non-essential services and allow taxpaying private industry to handle those jobs as long as the cost to the taxpayer is low and the workforce remains sufficient in size.

GARY Respectfully, the idea that “any” President can fix the unmitigated disaster of “Bushonomics” in a mere 10 months is preposterous on it’s face. In fairness, George W. Bush was merely continuing “Reaganomics”, whose rallying cry was “Government isn’t the solution, Government is the problem.” This was the thinly
disguised “marketing ploy” of the corporate and financial elite, who perpetuated this “fraud” so that they can destroy the labor movement in this country through outsourcing, and with it, the middle class. Now, America is nothing more than a failing democracy which more accurately resembles a “plutocracy” or an “oligarchy”, evidenced by the fact that from 1983-2004, an astounding 94% of the wealth
accumulated in America went to the top 20%. Art, you correctly argue that we must return jobs to America, but I cringe at the notion that you want to reward the same corporate elite with even more tax cuts. The percentage of U.S. Government revenues coming from corporations has fallen from over 50% in the 1940’s to 7.4% in 2003, an historic low. That same year, 61% of US corporations paid NO taxes. Quite simply, the corporate and financial elite in this country, aka the “Gloablists”, have sold out America. Until we ALL unite behind this FACT, America is beyond repair.

ART I find it interesting that whenever the Left is asked for a solution to an economic problem, it always ends up first becoming an issue of class warfare. They always blame businesses and rich people for their greed in causing a declining economy. The only time they say that government may be at fault is when it did not tax those folks enough. As for Gary’s comment that corporate tax contributions are
low, it is because they moved many of their operations overseas where corporate taxes are much lower than they are in the United States. That process is no different than what the State of New York is realizing today when it increased taxes on their highest earning citizens and those folks simply moved to another state. The bottom line is that JFK, Reagan, and Bush got it right. If you lower corporate taxes as I have suggested, you will attract more taxpayers and economic activity with the end result being higher tax revenues. Our economy is fixable. Unfortunately with Obama-Reid-Pelosi in control of our federal government, their policies will only delay the normal business cycle recovery and may actually reverse it with their
quest for higher tax rates and regulation. And their plans for more government bureaucracy will cost – rather than generate – new revenues.

GARY Art, you are 100% correct. This is class warfare, which has been waged by the corporate and financial elite against the middle class for decades through outsourcing and off-shoring. Long before this “banking crisis” began in 2007, tens of millions of jobs had been sent overseas for one reason: Corporate Greed. America has lost its textile industry, furniture industry and much of its automobile industry. Even the defense industry is slowly being moved overseas. Boeing needs
parts from India to build a fighter jet. Sikorsky can’t build a helicopter without obtaining the tail motor from Turkey. Vital American technology has been sent overseas as well. Westinghouse Nuclear has gone to Japan, and Bell Labs – along with its research patents – has gone to France. IBM has moved its purchasing headquarters to China. In the last ten years alone, we have lost 1/3rd of our manufacturing jobs. America had more manufacturing jobs in 1941 than it has today. Art, we are not in a recession, we are in permanent decline which has been concealed for years by the “financial gang” on Wall Street through the use of Fraudulent Financial Bubbles. (Tech Stocks, Subprime Mortgages and Commodities.) The “Globalists” aka the “free traders” are destroying America.

ART It is not class warfare Gary. In a capitalist economy, money always flows to where it can most efficiently be utilized. If you want those American jobs back, then you need to make the cost of those jobs attractive to that money flow. And I will repeat again that lowering corporate taxes on manufacturers and service centers based in the United States is the best option for bringing back those jobs. The
only alternative is for the federal government to impose such high duties or limits on imported goods that our labor costs become attractive by default. Is that what you want to do Gary? History already proved that such actions can cause worldwide depressions. It was called the Smoot-Hawley Act of 1930. I will also add that offering verifiable short-term new jobs credits to American businesses of all
sizes could spark the necessary hiring to get the economy roaring again. And such new jobs could prompt increased consumer spending levels which will generate the demand for those jobs to be ongoing. It is also important to note that American consumers benefit daily from the low prices available because of the benefits of lower-cost goods and services currently being imported. Gary, are you suggesting that
we force the public to pay more for those items to protect American jobs? I do, however, agree with you that any items dealing with national defense should not be allowed to be produced overseas and I would support any Congressional efforts to eliminate those current trends.

GARY Throughout history, whenever we defer to the elite, and allow them to operate without proper oversight and regulation, they destroy the economy. That was the lesson from the first “Robber Baron” era and that is the lesson today. Here are my solutions: 1) Repeal the IRS Code that gives incentives for corporations to off-shore and outsource. 2) Redraft NAFTA and all existing trade agreements until they are re-worded to better protect American workers. 3) Re-institute the Glass-Stegall Act so that our banking system no longer resembles a high risk casino. 3) Regulate ALL derivatives trading and stop the shenanigans on Wall Street, including the parasitic nature of private equity firms. 4) Have the federal government offer NO INTEREST loans directly to all small businesses that employ 100% Americans. That’s a
good start. However, I’m sorry to say that this is a pipe dream because it appears that both political parties are now wholly owned subsidiaries of the Corporate Globalists. Until public financing of all political campaigns is passed, very little will change.