The underlying problem with the economy is an extreme maldistribution of income between the working class and the capital owners. When a CEO can make 300 million dollars while an average worker’s wages haven’t even kept pace with inflation what results is a dysfunctional market economy starved for consumption spending. The average American has had to fuel his/her spending with debt obtained by borrowing on the equity within their home – that phantom equity has now evaporated.

In order to correct this out of balance condition there needs to be laws in place (similar to the anti-Trust legislation) that caps the annual income of all capital owners and their surrogates (CEOs, CFOs, etc.) at a specific federal percentage above that of the highest paid worker within their respective firm. Also, we need to eliminate labor arbitrage by canceling all Temporary Worker Visa programs (L-1, H1-B, etc.), and establish tax penalties for firms that expand their workforce above some threshold through outsourcing, or replacement hiring in foreign locations.

Essentially, FDR was accurate when he characterized the Great Depression as an out-of-balance Economic malady. Rural income prior to the Great Depression was significantly lower than urban income, now (overvalued home equity) as then there was unlimited amounts of overvalued phantom equity flowing into the stock market, the income differential between labor and capital while nowhere near the current astronomical level was still much higher than sustainable. There in lies the root cause of the out-of-balance condition that precipitated the Great Depression. Any system including the market economy that gets to far out balance does not function properly. Certain constraints need to exist to keep the market economy from slipping into a dysfunctional state. Balance is the essence of stability nothing short of this will guarantee permanence.

John Maynard Keynes –
If fiscal policy is used as a deliberate instrument for the more equal distribution of incomes its effects in increasing the propensity to consume is, of course, all the greater.
Aggregate consumption depends mainly on the amount of aggregate income.
Consumption – to repeat the obvious is the sole end and object of all economic activity.
We cannot, as a community, provide for future consumption by financial expediants [stocks, bonds, 2nd mortgages on home loans, etc] but only by current output.
Capital is not a self-subsistent entity existing apart from consumption.
Consumption is directly tied to the level of employment.

My Proposed Program
2 year 800 billion emergency Infrastructure Investment Jobs Creation Program (IIJCP) aimed at building new interstate highways, mass transit systems, schools, bridges, public hospitals, libraries, and assorted public buildings.
Eliminate labor arbitrage by canceling all Temporary Worker Visa programs (L-1, H1-B, etc.), and establish tax penalties for firms that expand their workforce above some threshold through outsourcing, or replacement hiring in foreign locations.
Taxation of corporate profits in the amount of 95% for firms that exceed a threshold level of jobs outsourced to a foreign country.
Taxation at the rate of 80% on individual yearly income received from any corporation, not-for-profit organization, or any form of legal entity where the total income exceeds the U.S. average yearly median individual income by 200%.
Fair trade agreements that ensure nations will offer decent wages, humane working conditions, and sound environmental policies.
A nationalized health care system for all U.S. citizens.
An effective federally funded tuition assistance program for U.S. citizens targeted at professions in demand.
Repeal all legislation that inhibits the right’s of individuals to organize under labor unions regardless of position or any other currently disqualifying classification.

My Observations:
An economy can only function when a large proportion of the populace is engaged in the economy thus able to purchase what is produced.
If price is inelastic and labor remuneration static demand will fall due to reductions by industries in their capital base (the most important being labor).
Firms forced to compete (those that are not oligopolies) in an economic environment where demand is declining will still compete on price but efficiency gains and operating cost reductions by nature have marginal declining utility whereby a point is reached when the firm’s factors of production (land, labor, or capital) must be slashed. These cuts in factors of production will have a multiplicative effect throughout an economy resulting in an ever building ‘wave’ of economic decline.
It is important to keep in mind that an economy cannot continue to grow when long-term consumption continues to decline. This in turn ties directly to reductions in the factors of production to accommodate continual long-term reductions in consumption.
When geographical barriers, constraints to the free flow of labor resources, underemployed resource utilization, similar knowledge distribution across all nation state’s, and nation state governmental inconsistency exists no global free market can exist and thereby at the nation state level no significant corresponding opportunity cost for engaging in one form of economic endeavor over another.

The underlying problem with the economy is an extreme maldistribution of income between the working class and the capital owners. When a CEO can make 300 million dollars while an average worker’s wages haven’t even kept pace with inflation what results is a dysfunctional market economy starved for consumption spending. The average American has had to fuel his/her spending with debt obtained by borrowing on the equity within their home – that phantom equity has now evaporated.

In order to correct this out of balance condition there needs to be laws in place (similar to the anti-Trust legislation) that caps the annual income of all capital owners and their surrogates (CEOs, CFOs, etc.) at a specific federal percentage above that of the highest paid worker within their respective firm. Also, we need to eliminate labor arbitrage by canceling all Temporary Worker Visa programs (L-1, H1-B, etc.), and establish tax penalties for firms that expand their workforce above some threshold through outsourcing, or replacement hiring in foreign locations.

Essentially, FDR was accurate when he characterized the Great Depression as an out-of-balance Economic malady. Rural income prior to the Great Depression was significantly lower than urban income, now (overvalued home equity) as then there was unlimited amounts of overvalued phantom equity flowing into the stock market, the income differential between labor and capital while nowhere near the current astronomical level was still much higher than sustainable. There in lies the root cause of the out-of-balance condition that precipitated the Great Depression. Any system including the market economy that gets to far out balance does not function properly. Certain constraints need to exist to keep the market economy from slipping into a dysfunctional state. Balance is the essence of stability nothing short of this will guarantee permanence.

John Maynard Keynes –
?? If fiscal policy is used as a deliberate instrument for the more equal distribution of incomes its effects in increasing the propensity to consume is, of course, all the greater.
??Aggregate consumption depends mainly on the amount of aggregate income.
??Consumption – to repeat the obvious is the sole end and object of all economic activity.
?? We cannot, as a community, provide for future consumption by financial expediants [stocks, bonds, 2nd mortgages on home loans, etc] but only by current output.
??Capital is not a self-subsistent entity existing apart from consumption.
??Consumption is directly tied to the level of employment.

My Proposed Program
• 2 year 800 billion emergency Infrastructure Investment Jobs Creation Program (IIJCP) aimed at building new interstate highways, mass transit systems, schools, bridges, public hospitals, libraries, and assorted public buildings.
• Eliminate labor arbitrage by canceling all Temporary Worker Visa programs (L-1, H1-B, etc.), and establish tax penalties for firms that expand their workforce above some threshold through outsourcing, or replacement hiring in foreign locations.
• Taxation of corporate profits in the amount of 95% for firms that exceed a threshold level of jobs outsourced to a foreign country.
• Taxation at the rate of 80% on individual yearly income received from any corporation, not-for-profit organization, or any form of legal entity where the total income exceeds the U.S. average yearly median individual income by 200%.
• Fair trade agreements that ensure nations will offer decent wages, humane working conditions, and sound environmental policies.
• A nationalized health care system for all U.S. citizens.
• An effective federally funded tuition assistance program for U.S. citizens targeted at professions in demand.
• Repeal all legislation that inhibits the right’s of individuals to organize under labor unions regardless of position or any other currently disqualifying classification.

My Observations:
• An economy can only function when a large proportion of the populace is engaged in the economy thus able to purchase what is produced.
• If price is inelastic and labor remuneration static demand will fall due to reductions by industries in their capital base (the most important being labor).
• Firms forced to compete (those that are not oligopolies) in an economic environment where demand is declining will still compete on price but efficiency gains and operating cost reductions by nature have marginal declining utility whereby a point is reached when the firm’s factors of production (land, labor, or capital) must be slashed. These cuts in factors of production will have a multiplicative effect throughout an economy resulting in an ever building ‘wave’ of economic decline.
• It is important to keep in mind that an economy cannot continue to grow when long-term consumption continues to decline. This in turn ties directly to reductions in the factors of production to accommodate continual long-term reductions in consumption.
• When geographical barriers, constraints to the free flow of labor resources, underemployed resource utilization, similar knowledge distribution across all nation state’s, and nation state governmental inconsistency exists no global free market can exist and thereby at the nation state level no significant corresponding opportunity cost for engaging in one form of economic endeavor over another.

I aim to please. :) Although honestly I believe that really is the only thing that would work. After I wrote that I saw that Slate actually did a piece a couple of weeks ago about how the Dubya looks at the world that I feel validates my opinion:

http://www.slate.com/id/2182222/

Heh. Now that’s funny. Sure it’s true as well, but thanks for the laugh.

s.s.

But I also recognize that Bush is the one driving this train on proposals like this stupid rebate so as “leader” he gets the lion’s share of the blame.

Oh, I completely share the blame with Congress…Pelosi and Reid are absolutely pathetic as leaders and it’s mind-boggling to me that so many utterly incompetent people could rise to leadership positions in both parties. I think this goes beyond the traditional “I hate Congress” gripes that everybody has from time to time…Pelosi is perhaps the most inept leader I’ve ever seen hold the top spot for any group. She’s incompetent, she’s insecure, she’s hyper-defensive, and above all she’s weak and easily rattled (it was reported that she actually reversed her position on one bill because the Republicans yelled at her…actually physically surrounded her and yelled at her, and she caved). She can’t even get her own party to back her choices for leadership positions in Congress (Steny Hoyer completely undermined her to swipe a leadership position from her choice Matt Murtha and she let him get away with it). How does somebody that pathetic hold onto the top spot for a year!?! Jim Wright or Tip O’Neill would have chewed her up and spit her out…probably after publicly reducing her to tears. Hell, if she were my grandma, I’d change my last name out of pure shame.

Even the leftists over at Huffington despise her:

http://www.huffingtonpost.com/darin-murphy/weak-has-a-face-and-its_b_66987.html

I mean, the Democrats are matching wits with arguably the stupidest, most unpopular and politically inept man ever to sit in the White House, and they’re losing. They’ve got the purse strings, they’ve got the power, yet they’re losing to an utter moron. The kicker is that they supposedly came in on a platform of ending the Iraq War and all they had to do was pass no supplemental funding bills to force a troop withdrawal or just let him veto what they gave him. They didn’t have to override a veto, they just had to let Bush veto whatever bill they sent him or refuse to send him anything and they’d win. Literally they had to do nothing and they’d win politically and end the war…and they still fucked it up!!! How do you fuck up something that simple?

Don’t be so quick to not share the blame. The idiots in Congress have just as much economic ignorance. Foolish ideas are easy to understand when all leaders are fools.

In “The Price of Loyalty” Paul O’Neill discussed the last Bush “stimulus” package (the $300 rebate when Bush first took office) and how he tried to talk Bush out of it because he and Alan Greenspan realized that it was too little money to provide any real stimulus but big enough to waste a surplus that could be better spent elsewhere. O’Neill made his case to Bush, rationally and logically, after which Bush (who’d sat through the entire presentation with a blank fucking stare while asking no questions) said that he couldn’t go back on the rebate because he’d already decided to go through with it.

To be blunt, stuff like this gets passed because our top executive position is held by a fucking arrogant retard (with apologies to the mentally handicapped). Bush makes decisions without bothering to think them through (and often operating from a position of more or less complete ignorance), he refuses to reverse or even reconsider his positions when people smarter or better-informed than himself point out the flaws, and he doesn’t give a shit what damage his decisions do as long as he personally doesn’t look weak or indecisive. He’s been this way consistently for seven years.

Face it, Dubya is a basically stupid person who doesn’t realize that he’s a stupid person because his primary opponents (Pelosi, Reid, Kerry) have also been basically stupid people who are incapable of outsmarting him. Don Boudreaux or anyone else with a brain can cite Milton Friedman, Ludwig von Mises, or Adam Smith all they want to argue against the rebate, Bush doesn’t care as long as he’s already made up his mind. The only thing that would actually convince that thick-headed fuck in to change any of his policies is a goddamned pistol-whipping.