Bank Of Montreal by Galt Museum & Archives on The Commons, on Flickr
We’re flat broke. What do you think of when you read that? Having been busted more than a few times in my life it means no money and no prospect of getting any. Pretty simple and straight forward, unless, of course, you are the Speaker of the House; then “broke” can be parsed and spun and twisted.
We have all seen the great orange Speaker saying “We’re broke” over and over again as he tries to sell a justification for what his masters (the Freshmen Republican “Tea Partiers”) insist on him doing with the budget. It is really an effective statement, powerful, short and direct. It would be perfect if it were not for the fact that it is flatly a lie.
The United States has a deficit. That is true. The United States also has a lot of debt, but to say that we are “broke” is ridiculous. It is just another half truth scare tactic from the party that has made a performance art-form of the practice.
Even Speaker Boehner’s office has had to admit that he is parsing the word. When they were challenged on the claim the U.S. is broke they came out with a statement that said when the Speaker says “broke” he means spending more than you have for an extended period of time. Sheesh! It is hard enough to communicate in this life without making twisted and tortured parses of common words.
What gets up right up my nose about this meme is that is completely ignores the fact there are two things to do when one does not have enough money. Spend less or get more money. As State Rep. Joe Gibbons (D-FL) put it so succinctly on NPR this morning:
If my family checkbook at home is short, you know what I do? I get a second job. I don’t just eat three days instead of seven. … What they’re telling us we got to do is, you got to eat three days.”
There is a lot of opportunity and in fact lot of desire on the part of the citizenry in the nation to raise taxes on the wealthy both at the state level and the national level. Nationally 88% of folks surveyed said they would rather raise taxes on millionaires and billionaires than cut programs in an effort to balance the budget. In Wisconsin where this fight is playing out on the smaller scale 67% percent said they would like to see higher taxes on people making $150,000 a year.
Of course this shows the basic Republican ideological bankruptcy. They have been trumpeting (that’s what Elephants do, trumpet, right?) about the freaking deficit for two entire years. Yet in that time they have not been willing to raises taxes on the ultra-wealthy. Just so it does not go down the memory whole, they were the ones that held the extension of unemployment benefits for millions of out of work Americans hostage to get an extension of the Bush Tax Cuts for the Paris Hilton’s and Koch Brothers of the nation.
They are also the ones that are now trying to claim that the modest job growth that we are seeing as the final bits of the stimulus money from the American Reinvestment Act are spent is due to keeping taxes at the same rate as when their deregulatory policy crashed the national and planetary economy.
All of this comes down to the thoroughly debunked and discredited zombie lie of “supply side economics” which says that as long as you can make things cheaply (through less taxes, less regulation and of course busting unions) the economy will grow and everyone will get richer. The fact is that demand is the constraint on growth. If no one can afford a new plasma TV, then plasma TV manufacturers are going to go out of business.
In an economy that has lost 9 million jobs and only regained a little over a million of them there is not enough demand. Since our lovely mega-businesses are sitting on a couple of trillion (yeah, as in 1,000 billion) and the workers have had flat wages there is only one real source of demand you can find in the economy, the government.
Which is why it is good that we can borrow so cheaply. You might think that a nation whose second in line to the Presidency says is broke would have a hard time borrowing money at any cost, but that is not the case for the U.S.
David Lynch over at Bloomberg had a good run down of it:
The U.S. today is able to borrow at historically low interest rates, paying 0.68 percent on a two-year note that it had to offer at 5.1 percent before the financial crisis began in 2007. Financial products that pay off if Uncle Sam defaults aren’t attracting unusual investor demand. And tax revenue as a percentage of the economy is at a 60-year low, meaning if the government needs to raise cash and can summon the political will, it could do so.[…]
Financial markets dispute the political world’s conclusion. The cost of insuring for five years a notional $10 million in U.S. government debt is $45,830, less than half the cost in February 2009, at the height of the financial crisis, according to data provider CMA data. That makes U.S. government debt the fifth safest of 156 countries rated and less likely to suffer default than any major economy, including every member of the G20.
That’s right kiddies, contrary to what you might have gathered from the hysterical braying of the Conservatives owned by the Koch bros’ we are not in any way shape or form facing a debt crisis like Ireland or Greece. Not even close.
We can borrow money at rates that other countries would kill for, and given that we need to keep our fragile economy growing it is the height of insanity to be looking at slashing programs that would remove between 200,000 and 1 million jobs from the economy.
Even if you are a debt hawk and don’t like the idea of adding to a debt that approaches the size of our GDP there is still the “second job” option of raising taxes. Right now the United States is taxed (businesses and personally) at some of the lowest levels ever.
Also from Lynches article:
Americans also aren’t overtaxed compared with residents of other advanced nations. In a 28-nation survey, only Chile and Mexico reported a lower total tax burden than the U.S., according to the Organization for Economic Development and Cooperation.
In 2009, taxes of all kinds claimed 24 percent of U.S. GDP, compared with 34.3 percent in the U.K., 37 percent in Germany and 48.2 percent in Denmark, the most heavily taxed OECD member.
So you see we have options, we are no where near close to being broke. It is a lie that Republicans want to use to once again brow beat the people of this nation into a situation that does not help them, but helps the fat cats like the Koch brothers.
It is not helpful at all for a high ranking member of the government to be spreading lies, but I guess we really can’t expect any better of a party that has lied us into war, has condoned torture and wants to dismantle the only force that balances the power of wealth, the unions. It is time to stay awake America, it is time to say “Bullshit” to this stuff and insist that the wealthy pay their fair share rather than cutting breakfasts for poor children and family planning for everyone.
The floor is yours.
