Robert Reich's economic prediction for 2011 looks good for corporations and Wall Street, but pretty poor for the rest of us. While Reich may point towards a political agenda, he also hits a pretty obvious point: American economics are out of balance, and the focus on elitism for economics will lead the rest of us poor.
What do I mean? Reagan's "Trickle Down Economics" were designed not to create an elite society separate from others, but rather to restore the balance between all segments of society. Excessive taxation on the upper brackets undermined incentive for investment. At some point, it went too far.
Today, our taxation and regulatory structures have returned us to a time when the rich have all the money, and the poor are left to beg for table scraps (or jobs as it were). American society has bought into the notion that if you free up money for the rich, the rich will create jobs for everyone else. Except, the rich got rich by being frugal, watching their money, and making wise investments. They didn't get rich by throwing money at bad or mediocre investments out of some duty to create jobs for other people.
Politicians have skewed the regulatory and taxation structures in favor of corporations. That has skewed the balance away from the small business. Why is that a problem? Small business drives the economy. Small business pushes innovation. Small business creates new wealth. Small business is the American Dream. Small business is how people get from being a dreamer to living the American Dream. Undermining that small business is how the American Dream is destroyed.
If Americans want to save themselves economically, they must push their politicians for a taxation structure that is balanced, that doesn't favor the rich or corporations but rather maintains the balance between each of us. They must start taking the opportunities to build small businesses instead of focusing on waiting for the rich to create jobs for them. And they must push for net neutrality, which will continue to allow Americans a free and open internet as a forum to build those small businesses from.
In bad economic times people often forget: Economic success stories tend to come from desperation not inspiration. Bad economic times are as good a time as any to build a small business.
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I don't know how many of today's rich got that way from being frugal and making wise investments. Starting a business and producing wealth and jobs is so much more difficult than simply tapping the wealth created by others. This new aristocracy and their elected servants care nothing about common people, small business, nor anything but their own well-being. Think of it: John Kerry and John McCain, for a couple examples, both have personal fortunes of 150 million plus. What in the world did either of them do to get so rich? All their wealth is stolen, legally, but dishonestly.
I would like to see a tax structure that distinguished between wealth creation and wealth collecting, but I have no idea how.
Uncle Steve
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