Trickle Down Lies Are Falling Apart All Around Us
Who are you going to believe: the Republican Party, or decades of real-world evidence?
The race in Georgia’s 6th congressional district has dominated our attention for months now. It’s an important special election that could provide meaningful clues for how next year’s midterm elections will go. For years, the district was in the hands of Republican Tom Price, but when Trump elevated him to the Department of Health and Human Services, Georgia’s 6th quickly became the most-contested race in the nation this year.
Last night, Democrat Jon Ossoff and Republican Karen Handel met in one final debate before voting starts. And if you spent any amount of time on social media last night or this morning, it’s likely you’ve already heard this snippet from Handel:
Here’s a transcription (emphasis mine) if you can’t watch video where you are:
This is an example of the fundamental difference between a liberal and a conservative. I do not support a livable wage. What I support is making sure that we have an economy that is robust with low taxes and less regulation so that those small businesses that would be dramatically hurt if you imposed higher minimum wages on them are able to do what they do best: Grow jobs and create good-paying jobs for the people in the 6th district.
Now, some have argued that Handel obviously just made a gaffe when she said she didn’t support a livable wage. I’d like to counter that argument with two points:
- The traditional definition of a gaffe is when a politician accidentally says something they really mean, which I believe is true here. And…
- What Handel says after “I do not support a livable wage” entirely supports her claim of not supporting a livable wage. She explains the traditional lie of trickle down economics, which is that if you cut taxes and regulations and keep wages low, business will respond by creating jobs. So she doesn’t support a government mandate to create livable wages; instead, she thinks business will raise wages to livable levels on its own.
Except that doesn’t actually happen in the real world. As I wrote a few days ago, wages in America haven’t increased in any meaningful way for decades. Instead, the money that used to go to wages—trillions of dollars—is going to the top one percent. And then the top one percent keeps it.
We can see the charts that prove this. The numbers are publicly available. We’ve watched this happen with our own eyes. But politicians like Handel keep insisting that we just have to cut taxes and regulations more and eventually those wages will rise. At what point will this happen? Unclear. Just trust them. Sooner or later, you’ll see it in your paycheck. The last 40 years was just warming up for the moment when the alleged “job creators” pay you back.
Without any real-world evidence to back it up, the trickle down argument is starting to wear really, really thin.
And as Erik Hanberg pointed out on Twitter pointed out, the ludicrousness of Handel’s argument is even more blatant than the usual trickle down nonsense. She is arguing that good-paying jobs are preventing the creation of good-paying jobs. If you just eliminate the good-paying jobs for people, she says, business will reward you with…good-paying jobs?
So that seems like a pretty clear distinction to me: Handel is on the record opposing a livable minimum wage. She made that case in the clearest language I’ve ever heard. Now it’s up to the voters to decide.
And while Handel’s comments were plastered over every social media feed in the country, something happened yesterday in Kansas that you may not have heard about. It’s another piece of evidence in the mounting case against trickle-downers like Handel—quite possibly the biggest piece of evidence yet.
This fantastic Vox piece by Alexia Fernández Campbell offers all the background you need, but I’ll explain it in brief to catch you up. In 2011, Republican Sam Brownback was elected governor of Kansas. He then decided to embark on the greatest trickle-down experiment in the history of America.
I’m aware that this sounds like I’m misquoting Brownback, or playing shoddy with the record, but that’s not the case. He announced the experiment, using exactly that language, in an interview on Morning Joe in June of 2012:
“On taxes, you need to get your overall rates down, and you need to get your social manipulation out of it, in my estimation, to create growth. We’ll see how it works. We’ll have a real live experiment.”
With the help of a Republican supermajority in the Kansas state legislature, Brownback then set out to create the conservative paradise of his dreams. He hacked regulations down to the nubs, slashed and eliminated taxes, and kept the minimum wage as low as he possibly could. In other words, Brownback did everything he could to create favorable conditions for the trickle down theory to play out in real life.
Yesterday, the experiment ended, and it the results were conclusive—Brownback’s theory was entirely wrong. Business did not grow—in fact, the one percent simply took the money from the tax cuts and kept it. They didn’t re-invest in the state. That money didn’t flow back into the state’s coffers in the form of increased revenue and hiring. In fact, the state lost a ton of money, as Fernández Campbell reports:
In recent years, lawmakers raised sales taxes and cigarette taxes to help balance the budget — a move that places a larger burden on low-income families. They also slightly reduced the tax deduction people can claim for mortgage interest and property tax payments. But even those moves weren’t enough to fill the state’s budget hole.
The budget crisis has collided with a long-running battle over public school funding. The state’s public schools are shouldering the burden of the state’s budget crisis, with $44.5 million cut from public education in 2015 alone.
So the budget crisis resulted in woefully underfunded schools, which themselves became a crisis. Which brings us to the end of the experiment: Brownback—always truer to his trickle-down vision than to the people he represents—vetoed a bill to end his tax reform “experiment.” Yesterday, Kansas’s Republican-majority legislature overrode Brownback’s veto, returning taxes to something much closer to pre-experiment levels. This is what it looks like when a state Republican Party admits that their trickle down policies don’t work.
So Republican Karen Handel has publicly admitted that she’s against livable wages. Kansas Republicans have admitted that trickle down economics don’t work — that lowering wages, cutting regulations, and shrinking taxes lead to failure. What now? Surely, at the very least, the Republicans in charge of implementing Kansas’s conservative budget dystopia will never work in politics again, right?
Uh, no. In fact, the exact same economists who ruined Kansas are crafting economic policy for the rest of the country. As Fernández Campbell writes, Sam Brownback’s economic advisers, Arthur Laffer and Stephen Moore, helped to shape President Trump’s slash-happy budget. In April, they contributed to an editorial for the New York Times making the same exact claims that they’ve always made:
We should emphasize that business tax relief is not a sellout to corporations but a boon for middle-class workers… The additional increase in real wages could be nearly 10 percent over the next decade, which would reverse 15 years of income stagnation for the working class in America. And, if we are right that tax cuts will spur the economy, then the faster economic growth as a result of the bill will bring down the deficit.
Sound familiar? It’s the same ridiculous treacle that Handel is pushing on live TV. It’s the same disastrous “experiment” that Brownback played out. There’s not even a fresh paint of coat on the idea, or an attempt to rebrand the concept as something new. Their trickle-down plan is the same as it’s always been, and they expect you to ignore all the evidence, get in line, and accept their bullshit as truth.
