Thursday, January 06, 2011

Can we become a "Corporate Banana Republic" and still be America?

Is a Corporate Banana Republic bad for the US?

As the nation continues to vilify Union Members and Government Workers (often unionized), I worry that we are becoming a Corporate Version of a Banana Republic. We have a bifurcated wealth system with the top 1% of the country’s population holding more wealth (cash / land / means of production (i.e. shares of companies)) than the bottom 95% of the country. In the 70s, the ration was top 7% owned about 35% of the government’s wealth. The richest pay 35% in income taxes (when they can't avoid it). In the wonderful white world of the 1950s the top tax rate was 90% of income over $200,000.

So... is it a problem? In the past it wasn’t a problem because the richest only stayed rich if the country stayed wealthy enough to buy consumer goods. But now profits of corporations are not dependent on the health of the US economy.

The United States is in the position where out richest citizens and companies elect the government of this country (and regardless of party, nearly all elected officials depend on corporate donations to get elected). But the corporations and individuals are making their largest profits outside of the US. For example, US Corporations hired over 1 ½ million people last quarter – in China. US Companies fortunes are not tied to our country's health.

So the ruling class, the electing class, is becoming less and less dependent on the economic health of the country. And therefore we have loud and noisy elections about nothing: a religious center moving 3 blocks – but hastily called “the ground zero mosque”, and the constitution, and Tea Parties, and artificial arguments that our President is from Kenya – instead of a discussion about the health of the country. These arguments are transparently worthless and transitory – have you heard about Kenya or the “Ground Zero Mosque” since the election? – but they keep the electorate busy instead of worry about real issues.

So is it bad for America?

I mean, my assumption is that this will be bad for America, but maybe not in the short term. If the top 1% of the country can convince the middle 50% to pay for the bottom 49% (which is what is happening in terms of income tax) – then the system can continue. They keep us in the middle paying - in the promise we might join the top and the threat we might fall into the bottom, then the system works for a while.

But the idea of “the good of the country” or the “good of your neighbors” has disappeared. Doing what is right is considered quaint. Talking about the “good of the country” you are immediately laughed at. I spoke about the need for education and infrastructure and was responded that people should pay their own way. I’m not religious, but I still think we have an obligation to future generations. An obligation for good schools, reasonable roads and a basic level of health care. I am laughed as a stupid tax and spend liberal.

The top 1% of earners just got another tax break of hundreds of billions. There top rate is 35% now vs. 90% in the 1950s and 70% in the 1970s.

Anyone who leaves an estate of more than $5 million dollars pays 35% tax on it, vs 50% after the first million under “tax god” Ronald Reagan.

I don’t think it is good for America. Ultimately I don’t think it is sustainable to drive the government like this AND expect to pass on anything that we regarded as “America” to a future generation. At best we continue to the move towards gated communities, private schools and a growing lower class that we buy off with welfare and food stamps until we move to the gated communities and forget about them. And the at best assumes that we stop carrying about our co-citizens. Maybe churches and religion are the best way to care about people (but then I wish they would stop hating on the fags) - but it used to be possible to believe in "America" and the best for "Americans" without being ridiculed and without being religious. We are now labelled secularists and liberals and we should be drive from the country.