ROMNEY ECON LIES: THE BIG IDEA: REAL REFORM: SEPARATE BANKS!

After the second debate, many of the talking head pundits (the media/press) thought the President needed a big economic idea to counter the Romney/Ryan economic plan to create jobs.

To oversimplify the complex is to leave out truth. Henry Schoenberger, ehs@ehenry.net)

Romney’s plan: Supply side economics.  Which simply is the fallacious theory that lowering taxes will create jobs, because individuals and businesses will have more money to invest in activities that create capital formation.  There is absolutely no empirical evidence this theory has created any jobs since Ronald Reagan embraced this concept in 1980.  Romney’s Chinese water torturous repetition of the fallacious supply side notion has obscured, for too many Americans, the self evident fact that  so-called job creators have been creating personal net worth at the expense of our economy and the middle class for the past thirty years.  Ironically, Romney is a shining example of how the “job creators” have shipped jobs and parked profits offshore.  Supply side is a ruse for sociopathic greedy ultra rich narcissists to amass a grotesque pyramid of net worth, again at the expense of the middle class.

Romney is a broken record hawking his economic plan: “I will create jobs by lowering taxes for everyone, when Obama wants to raise taxes.”  I live in Shaker Heights, Ohio, and that is his ad which is running over like a toilet that won’t stop.  A simple plan, based on a complex lie.

Romney has been OK at identifying problems, but will fix everything by letting the free markets work and lowering taxes – ideas proven historically wrong for the 99%.  And nothing but Wall Street propaganda to promote unfettered sociopathic greed.  Americans have been fed the lie that free markets self correct due to the theory that the market is rational.  Markets are a bunch of people buying stuff – I rest my case.

Obama has expressed what he is doing to restore jobs as well as address the deficit.  He will “raise taxes only for net incomes above $250,000.”  He has explained the necessity of Government Spending to create jobs when the private sector will not and has not; and related this to how Keynesian Economics (government investment in a struggling economy) gave life to Roosevelt’s New Deal in the aftermath of the “Great Depression.”  And Obama has proposed jobs bills to deal with decades of national infrastructure neglect and deferred maintenance as well as new projects required by the growth in population.

Republicans have voted in lockstep against jobs bills to provide at least 3M more jobs, which would restore the financial lives of so many of their fellow Americans now suffering in the shadows of financial tragedy.  (Further more jobs means more consumers and more tax revenue for a Government starved for revenue in an economy gasping for air in a depression.)  TARP should have been better and bigger, along with teeth to control banks; but Paulson from Goldman made certain that did not happen, and Congress, of course, failed.

Obama has also explained his committment to funding green renewable energy, which already has created new small businesses and jobs.  Green energy will remove the US from Middle East oil dependence. He has imposed tariffs on China to level the playing field for certain US industries, and plans to do more in China to level the playing field as well as in countries with unfair currency advantages or indentured servant wage levels like China, where workers are treated like slaves and live in dorms behind fences.  To impose tariffs and lodge complaints about unfair trade practices will create more demand for American products, therefore result in more jobs – this is part of Obama’s economic plan going forward.

Romney prefers to bloviate about getting tough with China – when he is guilty of shipping jobs directly to China as well as creating an outsourcing company in China to suck jobs out of the US.  And too many members of the media can’t summarize this as part of Romney’s economic plan.  Too complicated?  Or just too lazy to explain – or is it that Romney’s lies are so simple they are easier to grasp and promote.  Little sound bites with empty calories – that will make the whole country really sick if too many Americans swallow them.

The facts of what Obama intends, tried to accomplish and has accomplished in the face of lockstep opposition are empirically clear.  More members of the media could choose to repeat – the facts of the matter, as  Republican pundits love to proclaim when they overtalk and interrupt the truth. The media has a choice to not repeat and parse the lies of the sound bite liars.  It has a choice to objectively create informed public opinion about what Obama’s economic plan has been and must remain in order to extricate our economy from the depression he inherited.  The choice is to not be non partisan about empiracal truth. The media could choose this alternative, but prefers to think Obama needs a “big idea,”  And maybe he does considering all the sound bite listeners.

To be objective: the media/press must relentlessly link the fact that Obama will only raise taxes for the top income bracket at the moment when the Republican being interviewed or used as a political foil (i.e.,  Michael Steele) stresses how Obama wants to raise your taxes –  or be guilty of committing the crime of creating a platform for a liar to argue the world is flat.

Americans ought to be able to figure out that Obama’s economic plan going forward is to create a fairer playing field by raising taxes on billionaires and eliminating subsidies for Big Oil and closing the carried interest taxation of earned and unearned income for people like Romney, but somehow it is more complicated than one phrase or two big lies.

Clearly the hoards suffering from mental rigor mortis can’t or won’t listen or acknowledge that Obama does makes economic sense for them because they hate having a black man living in the “White” house, so prefer to be the pawns of the sociopathic greedy narcissists.

My blog – the 5th estate – is not politically correct.  Because, I only care about one side, the objective truth or at the least – the self evident nature of empirical evidence.  I regret the 4th Estate has become, too often, non partisan.  And the essential question is:  how can one be non partisan about truth?

Romney’s base and his party defeated parts of Obama’s economic plan by voting in lockstep against the best interests of their fellow Americans. There have been exponentially more filibusters’ than ever before to make Obama look bad so Republicans can “get rid of Obama;” (refer to M. McConnell; or J. DeMint, Tea Party leader, creationist and great pre Dark Age Thinker). And Republicans pledged allegiance to Grover ahead of their allegiance to the best interests of the United States. (What’s up with this?)

Obama’s economic plan:  has created 5M jobs in the wake of all Republicans voting in lockstep against the public good; the Dow is up; and big business is making money but not by adding jobs so there is a paucity of middle class consumers which affects demand; which brings me back to the fact the banks are not lending.  And the Fed and Obama could do something about this, which I will save for another time.  (It’s in How We Got Swindled…)

Obama has failed to do something about the unfettered, self interested and greedy banks (Trojan Mega Bank Holding Companies).  Dodd-Frank is a sham transaction, and reform is something Wall Street is inexorably opposed to.  Bigness is a terrible and lethal problem, yet Obama has shied away from explaining that the ostensible promise of Dodd-Frank “reform” has been soiled beyond repair by Wall Street Lobbyists and 2,000 pages of rules which cannot be effectively administered. And if you understand the history of the SEC – of prone/non intervention and not enforcing existing regulations which would have rendered the collateralized mortgage obligations illegal – it is impossible to grasp how the SEC could have been set up to assume the responsibility to administer and enforce Dodd-Frank.  So the Big Idea is the only solution, and simple enough to explain in two minutes in a debate or in a 30 second commercial.

Almost everyone, except the officers of the too big to fail banks, hates the banks (not the community banks) and knows the Mega Banks do not support regular people.  Therefore, if Obama suddenly decided to include separating banks as part of his plan to restore economic stability and jobs, and explained why, it would be very appealing – apart from being critically necessary.  The media/press would jump on the bandwagon, and the 99% would get it!

Wall Street is now occupying the land of Mega Bank Holding Companies, and has become an inexorable part of the too big to fail arena because the risk has been shifted to us – our government.  So we the people are underwriting the risk of all the egregious leverage used to create net worth to feed sociopathic greed, as well as the inadvertent and unwitting sponsors of all the reckless financial behavior which does not care about real investment to create capital formation and jobs.  We can thank the Fed for allowing the investment banks to become Bank Holding Companies.  Does the media get this and so Americans are too lazy to figure this out so don’t.

Part of the Big Idea should be to reiterate that our mega banks do not help small business start ups, or existing small business or homeowners. Mega Banks refused to lend money (government funds from the Fed) to GM or Chrysler, so the Government stepped up to the line and saved the jobs. (Keynesian can work.)

It is self evident that lowering taxes for the already rich has only created multi-millionaires and multi-billionaires – never jobs.  In fact the supply side lie has created the largest number of members of the ultra riche club in the history of the world.  Supply side was a fundamental cause of our current financial mess.  There is a vast amount of empirical evidence proving that lowering income taxes for the top bracket never created jobs.  You can be certain the Chameleon knows.  Both Romney and Obama will lower corporate tax rates, but only Obama has talked specifically about curbing tax laws which allow and encourage jobs and profits to be shipped offshore.  Is it logical to expect companies not currently paying taxes in the US to be motivated to return when they now get away with tax evasion and still will be influenced by macro world wage levels?

The Romney Economic Plan is to repeat his economic lies often enough that all the wrong wingersthe faith based religious zealots who cling to creationism while sitting in corners sucking on bibles –have faith in his platitudes; while the “haves and have mores” chuckle silently behind closed doors, raising money from their peer group of sociopathic, greedy narcissists.

Obviously Republicans do not need evidence to have faith as a majority has lined up with the great pre Dark Age Thinkers from the days of yore, well before leaching was a popular medical treatment.  And the ultra rich who do not care one wit about Romney’s 47% embittered takers lingering in the shadows of ignorance waiting for government handouts, have somehow created an army of pawns to support not raising taxes on people making more than $500,000 or $8,000,000.  As a matter of fact their representatives in Congress have pledged allegiance to Grover Norquist ahead of the best interests of their country and fellow Americans – a demonstration of infinitely repulsive lunacy and without political precedent. It is apparent that Grover represents to the Tea Party, and their Republican enablers, the 2nd coming of “Big Brother” straight out of the pages of Orwell’s 1984.

Voting in lockstep against any new tax (no matter what) should be regarded as a form of Armageddon for our economy, but Rapture for the lunatics.

Romney has the answers to create profits by buying companies, loading them up with leverage and then pulling out huge “dividends” and management bonuses, from where? – the additional company debt, and then receive capital gain treatment?!  Carried interest is a lie.  How dividends and bonuses came to be taxed as capital gains and not earned or unearned income is a mystery, but not to George Bush who got tax laws passed to allow this.  Lots of people aided and abetted by our media’s non partisan approach to the truth think Romney has a better handle on the economy than Obama.  The only small businesses Romney is for are hedge funds.  And the genius Romney was adamant about letting GM and Chrysler go bankrupt…vehement about not loaning them one dime – which would have cost millions of Americans jobs.

Obama inherited a depression or at least the 2nd worst economy since 1776.  And it is not like the Reagan recession or any other recessions. Arthur Laffer and Paul Krugman agree this is a depression.  But it is not politically correct to use this nomenclature and most members of the 4th Estate do not understand this distinction so allow all the recession talk and silly double dip talk to proliferate, which does not objectively create informed public opinion.

Obama is afraid to use the word depression because it is depressing, and far more difficult and complex to overcome than a recession.  (The goal is to restore confidence in our economy.) But depression it is which leads to a lofty Big Idea whose time has come once again.

Adapted from an article in the Law Library – New York Times, Wednesday, October 17, 2012:

The Glass-Steagall Act, also known as the Banking Act of 1933 (48 Stat. 162), was passed by Congress in 1933 and prohibits commercial banks from engaging in the investment business.

It was enacted as an emergency response to the failure of nearly 5,000 banks during the Great Depression. The act was originally part of President Franklin D. Roosevelt’s New Deal program and became a permanent measure in 1945. It gave tighter regulation of national banks to the Federal Reserve System; prohibited bank sales of securities; and created the Federal Deposit Insurance Corporation (FDIC), which insures bank deposits with a pool of money appropriated from banks.

Obama needs some insurance against the lies bought by gullible Americans who believe in repetitive empty rhetorical platitudes, and bold lies.  He should step up to the line by stating that he had thought Dodd-Frank was a valid solution to control bigness to reign in reckless bank risk and leverage.  However he ought to now cite all the lobbying and Wall Street manipulation to render it useless; and promise to pass legislation similar to Glass to protect Americans from Banks-Investment Banks and the voracious sociopathic greed of the individuals who contrive leveraged toxic financial investments innovated for personal fees (piggish executive compensation) in lieu of creating real investments to create jobs and capital formation.

Capital formation creates jobs, and lowering taxes does not and does not created capital formation.  Lowering taxes for the already rich only creates more personal net worth. Romney is on thin ice if he tries to talk about capital formation, and will not because his track record is based on creating fees no matter what the cost to the employees and companies he and his Bain vulture capitalists touched and often tanked with an overload of debt.  This is historical fact – in the securities business this is termed a “track record.”

Glass-Steagall has been thoroughly addressed in my new book, and the cry for Glass-Steagall is growing. Certainly with Paul Krugman and Robert Reich firmly behind Glass the reason d’être is well established.

I rest my case again.

 

 

 

 

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