Pres Obama: David, in pursuit of strengthening SS, I'm willing to cut SS benefits

[JDPriestly]

164. Maybe, but . . .

"When you and I paid those taxes there were schools you could attend without too much debt, jobs, health care, housing."

Actually, I worked, went back to school evenings (part-time) , borrowed money and got a professional degree in the 1990s. I paid extremely high tuition for that degree, and my interest rates were 7.5 to 8.5 percent on my private loans. The interest rates were far higher then. And when we bought our house in the late 1980s, interest rates were through the roof. So, actually, we paid the higher tax rates and higher interest rates.

There are two reasons for the job losses we are suffering.

The first is "free" trade. There is a hidden cost in all those Walmart bargains. It is paid out of our paychecks. When we go to get a job, we have to compete with low-income workers all over the world.

Now when a fat-cat investor looks for a place to multiply his profits, he analyzes the markets and gets the best deal for himself. Very often he decides he can make more if he invests in a country with cheap labor. He profits. American workers lose because more jobs that could be done in America are done somewhere else.

The second reason for job losses is computerization and other technological "improvements" in the workplace and in industry. My husband visited a grocery store in our area recently. There were no human check-out clerks. It was all machines. We will never go back. I like to greet a human when I shop. But that's another reason we have lost jobs and pay is down.

Here again, there are losers and winners in this "improvement," in this progress. We can't stop progress, but we should, as I explained before, share the costs and benefits of progress fairly. The costs should not all trickle down to the bottom of the wagescale, the working people, while the benefits, the increased profits, spray up like refreshing fountains on the wealthy.

Republicans need to understand that the free market will become more and more despised if it cannot also be a fair market. I am not opposed to the rich. I am not opposed to rewarding innovation and hard work. I am opposed to the unwillingness to see the big picture and to profit from the misery of others. Everyone needs financial incentives. That goes for working people as well as the wealthy. Since 1980, the financial incentives have gone more and more to the top. Almost nothing trickles down, and it appears that no one understands or cares.

I am very, very disappointed in President Obama. He does not seem to understand how economics works, not at all. Had he understood, we would see more of our bankers and Wall Street traders sitting in our jails.

There is an argument to be made for the fact that the jobs that are now done in cheap labor markets and could be done here for higher wages help developing countries raise their standards of living. Those standards of living are being raised at the expense of working people in our country. Investors gain from the difference in the cost of making a product and the price of selling it in the US (or Germany or Switzerland, etc.) So, investors are gaining from the losses of working Americans. Clearly if you want to talk rationally about "shared sacrifice" you must find a way to shift a portion of the gains that investors make who profit from cheap labor overseas into the pockets of working class Americans.

Chained CPI does not shift any of the profits made by those who are exporting good American jobs and have exported good American jobs into the pockets of the people who have lost the most in that export bargain.

A way to shift the investors' gains into the pockets of the workers in the US who have suffered the losses is to impose import taxes on products coming from low-wage countries in order to fund education and other socially beneficial programs here.

Another even simpler way to shift the investors' gains into the incomes of working people is to raise taxes on the rich and specifically on capital gains and the kinds of investments that cause the job losses. There are many ways to do that. But the goal should be to raise those taxes above the rates that prevailed in the 1990s. Some of the sucking sound that is destroying American jobs might be muted just a bit.

Another way to shift for positive benefit would be to impose taxes on stock market trades completed within the US while also taxing transfers of money out of the US regardless of the purpose for the transfer. These taxes would not need to be so high that they would impede investment or the markets. Some of the European countries are already imposing certain taxes a little different than I have proposed but for the same purpose.

"Instead we are using it for stupid wars . . . ."

Agreed. That is another way we could save tons of money.

And while I am at it. Have you ever known someone who lived through bombing raids in Europe as a child? I have. That person suffered from PTSD. It was a horrible experience for that person. It resulted in a terrible waste of talent. I often think of the children in Iraq, Pakistan, and Afghanistan who, now, are surviving frightening monsters in the sky above them and the unpredictable horror of bombing raids.

We pay for that. Terrorism is a horrible problem. I remember when we had Palestinian terrorists in the 1960s and 1970s. The problem has worsened since that time.

We have been fighting terrorism forever already. We have to find new solutions. I don't have ideas on that one, but certainly imposing austerity on people who have already tightened their belts over and over in recent years is not the answer.

The people who should be called upon to sacrifice are those who have gained, those who are wealthier now than they were a few years ago, those who bought inexpensive homes that had been foreclosed and will make a killing when they sell them. Capital gains taxes need to go up. We have to find ways to tax capital fairly. We tax labor on the wage statement, before the laborer sees his paycheck. We have to tax capital in that same way.