Don’t Buy the Republican Lie — We Are NOT Broke!
One of the most persistent lies Republicans tell to get people to vote for them is the one in which they claim the United States is too broke to afford to do things we have to do. This is an absolute lie. As you’ll see later on, we’re not even close to broke. Haven’t more of you wondered why we seem to have enough money to increase defense spending every year and to give the rich massive tax breaks? We can pay for all of that, but we have a hard time finding the cash to spend on hurricane relief for Texas, Florida and Puerto Rico? How does that work, exactly?
For that matter, why is it that Republicans talk about debt obsessively when Democrats are in the White House, but they never discuss it when they are planning a tax cut? Republicans love to imply that a certain level of debt is a sign that the country has no money, but that’s ridiculous. Just about everyone in this country carries some level of debt, but it doesn’t mean we’re all broke. If you pay a mortgage every month, you’re in debt. If you make a car payment every month, you are in debt for that, too. Many people (too many people?) carry credit card debt from one month to the next. However, is everyone who carries some level of debt broke?
The answer is, of course, no. Tell you what; ask the single mother in the inner city who is living in a slum how “broke” you are to be in debt to the tune of $200,000 for your home and/or $30,000 for your car. She probably wishes she was that “broke.” Carrying debt doesn’t mean you’re broke, and this country is not broke. Of course, it’s no thanks to the Republican Party, who act to starve the US Treasury and then complain that the government has no money for the basics. We have plenty of money to spend on weapons systems we hope to never use, but when it comes to providing services for the people who pay taxes, there is nothing left. Imagine that.
Despite Republicans constant talk about debt and deficit,but only when Democrats are in charge, our debt is not a sign that we’re broke. In fact, the fact that it;s no problem getting people to lend us money is a pretty good indication that we’re nowhere near broke. The government doesn’t borrow money because the country has run out of it, they borrow money because the government is not collecting enough to do everything we expect the government to do. For example, how many Trumpies realize that most of the money the government borrows comes from us? Probably not many. However, if you or your retirement account has ever purchased a Treasury Bill, you have lent the government money, and the interest you make on that contributes to the deficits. And it’s a great investment because we’re nowhere near broke.
Right now, the Republican Party and Lord Donny have put forth a tax bill that will actually send the $443 billion deficit far higher. And just yesterday, Paul Ryan told us that the tax cuts will create greater economic activity, which will make government revenues soar. How many times have they told us this in the last 40 years, and it has never happened. It ever will, either. If you expect the average company to voluntarily pay lower level employees $75,000 per year out of the goodness of their hearts, well, what country do you live in? It can’t be here, that’s for sure. We don’t need tax cuts at all. Republicans are lying to you when they claim we have the highest taxes in the world, which they repeat constantly, despite the reality. Yes, our top corporate rate is the highest in the world (barely), but the effective corporate tax rate is about 20 percent which is among the lowest among developed countries. Check out this chart. Revenues in the United States are 26 percent of GDP, which is far below the 34 percent average among OECD countries. (Source)
If you want to know why we seem too broke to do anything, well, this is why. We don’t collect enough tax revenue to do what needs to be done. And if you’re thinking you’re paying too much in taxes and you don’t want to pay anymore, think about the cost of being the only country in the world without Universal Health Care. If you don’t consider the amount you pay for health insurance a tax, well, perhaps you should. Other countries don’t pay nearly as much as we do for health insurance; instead they pay a little more in taxes, so they don’t have to worry about getting sick and losing everything.
If you think it’s coincidence that the only time the deficit skyrockets is when Republicans are in charge, you should know better. From the end of World War II until 1980, the deficit shrunk from 120% of GDP to 32% of GDP. In actual dollars, the deficit was $900 billion in 1980 and grew to $6 trillion by 1992. It stayed flat for the eight years that Bill Clinton was president before George W. Bush watched it soar again to nearly $12 trillion, as he cut taxes to the bone, even as he conducted two wars off the books. Yes, it went up to about $19 trillion while Obama was president, but the deficits trended way down, and were one-third what they were in Bush’s last year. The only two presidents since 1980 who have seen an overall decrease in deficits have been Clinton and Obama, not Reagan, Bush 41 or Bush 43. if you’re looking for irresponsibility when it comes to taking care of the taxpayers money but no further than the GOP. If you’re one of those Americans who wants good schools, smooth roads, clean air, clear water, safe food and safe workplaces, you should realize by now that Republicans hate all those things, and want to cut them out of the budget altogether.
If you are part of the 99% and you work, you pay more federal taxes than most Republican politicians and their sponsors, of course. We can’t seem to get Trump’s tax returns, but does anyone remember Mitt Romney? The last year for which he released a tax return showed that he paid 14% of his income in taxes. Meanwhile, the average fast food worker pays more than 15% in Social Security and Medicare payroll taxes alone. If you’re wondering why the government is borrowing so much money, that’s why. If Mitt Romney, Warren Buffett, Mark Zuckerberg and the rest of the nation’s billionaires are not paying their fair share, who do you imagine is picking up the slack? The poor can’t make up the difference, and wage earners have been watching their wages go down over the years. If you work for a living, you haven’t seen your taxes go down, but the owners of your company sure as hell have.
If you believe we’re broke, as a country, open your eyes and look at the raw numbers. The US total household net worth — the amount of wealth we hold, is more than $96 trillion. (Source) The value of the US economy’s assets is in excess of $296 trillion, which is 1576% of GDP (for the Trumpies out there, that is 15 TIMES the current GDP) and the total debt in the economy is about $145.8 trillion. That means our economy’s net worth is about $123 trillion.
Does that sound broke to you? Our net worth is higher than anyone else in the world, by far. And since our national debt is just under $20 trillion, surely you can see that it would be easy to slap a tax on the richest in our economy and pay off that debt in a relatively short time. And yet, since the Republican Party took over Congress in 2010, government spending has barely budged, except for “Defense.” The GDP is more than $17 trillion per year, and the government spends about $4 trillion. The economy is booming, but Republicans are intent on “starving the beast” so they can claim we’re all broke. How broke could this country be, if Lord Donny can manage to stuff his Cabinet with billionaires who think spending $400,000 of taxpayer money on private planes was acceptable?
No one could possibly disagree that the numbers quoted above are huge. So, let’s lop off the same number of zeroes from each number, so the numbers are relatable to the typical family. Imagine your family was able to boast of numbers like these:
The total value of our assets is $2,960,000.
The total amount of our debt is $1,460,000.
That makes your net worth $1,500,000.
Again, does that sound broke to you? How many families do you imagine have assets worth more than their debt. If that was your family’s financial statement, would you be more likely to be heading to bankruptcy court, or to Tahiti for a vacation?
Our income is $1,710,000 per year.
Your total expenses come to $400,000 per year.
That means you have disposable income of about $1.3 million per year. That’s not broke. Even if you paid 50% in taxes, you would still have $455,000 in disposable income. Are we supposed to feel sorry for you?
The problem is actually easy to fix. Those with the most money have decided that accumulating wealth is more important than investing in everything that makes our country great. Two things need to happen. First, the government has to raise more revenue, which means we have to get away from the Republican concept of government spending. Republicans see all spending as waste, whereas sane people understand that government should be investing money on those things we need. Among those things include a new electrical grid, new modes of transportation that wean us off our fossil fuel addiction; a stronger, faster and more secure technology infrastructure; a greater, more modern manufacturing infrastructure and an overall infrastructure with 21st-Century technology as its centerpiece. We need to invest in ourselves, like we used to.
When Republicans tell you we’re broke, they are simply lying to you. We need to throw these liars out of office next year. Wake up and do that.
Originally published at PCTC Blog.