While working out this morning, I watched as either Joe Scarborough or Harold Ford, Jr. (I don’t recall which) lampooned the notion that Rick Perry was responsible for the job growth in Texas. The speaker credited Texas’ rich resources and ample supply of cheap labor due to the influx (some illegal) of migrants from Mexico and points south.
What a difference from the nonsense that Americans have been taught to believe about the USA’s past remarkable economic growth and which is spewed forth in a incredible stupid (considering the authors) recent publication “That used to be us” by none other than the eminent Thomas L. Friedman and Michael Mandelbaum.
This is the first in a series in which we will excerpt portions of the book as we continue to argue through it. (Seldom have we contended so much in the margins.)
The USA didn’t succeed in the past because we had more industrious, more virtuous and smarter workers. All nations are made up of good and able people (and a number of others.) We were protected from wars by two huge oceans, we had what seemed like endless resources for the taking (cheap and fertile ground for all comers, ample lumber, coal, iron ore, and oil.) Furthermore we had slave labor who became ‘serf’ labor after the Civil War as well as countless immigrants who worked for pennies, built our canals and railroads, and grew our food.
Texas is one of the few areas in the nation where these beneficial factors still exists. So it grows and prospers and can afford low taxes, which furthers what economists call a “virtuous cycle.”
We will never recognize what is really the matter with the country until we appreciate what made the USA so successful in the past.
As for what our real problems are today, they are not what is being discussed by the media or the politicians but are what were mentioned during President Barrack Obama’s presidential campaign:
1) Health care absorbs close to 18% of Gross National Product, 6% more than any other advanced nation. Meanwhile our heath care is rated as mediocre.
2) We spend 6% of our GNP on defense which is twice what we should even though at 3% we still would be spending much more than any other nation.
3) Much of the wealth of the nation is being siphoned off by the parasitical financial system, which goes far to explain why the medium family income of the top 0.01% of the nation average $28 million per year. Wall Street no longer serves Main Street; it loots business!
4) We are at war with the underclass in the nation through the ‘Jim Crow’ War on Drugs. This funds vested interests in the pharmaceutical and criminal justice world which prevent meaningful reform and has become the largest and most profitable American industry. Prohibition doesn’t work. Public health initiatives do.
5) We are adverse to having the most fortunate pay their fair share of taxes as they did in the past. Today the highest marginal tax rate kicks in at 33%. It used to be over 90%. At the time of the Eisenhower administration, it was something like 85%. All Obama wants to do is increase the taxes on those earning over a million a year by 2%! Ask yourself, how come the nation prospered when the super rich were taxed heavily and is in steep decline since they have been enabled to avoid most taxes through various provisions such as Capital Gains and lobbyist created special loopholes? The answer for a large part is the lack of purchasing power by a shrinking middle class, known as a drop in consumer demand. Studies of the nation’s economic history show this.
Bring about appropriate reforms and prosperity will return; vast sums will become available for education, government investment in infrastructure; and the USA will again prosper and be competitive with any nation in the world. The economic succes of Syngapore teaches that a nation needn’t have endless resources to prosper. Certainly the USA no longer needs to exploit the underclasses to excel.
Friedman and Mandelbaum are guilty of what psychiatrists call “identifying with the aggressor.” They want us to believe that our plight is due to the public’s insufficiencies; in fact, the opposite is true. Unfortunately in both the Republican and the Democrats we get the “best government money can buy”. Most are in government for paychecks in the form of cushy future jobs in the private economy or to serve special interests with huge sums to contribute.
These are the real problems. Obama addressed many of them head on during his campaign but has been thwarted almost at every turn by those determined to gain control of the government, prosperity be damned.
The public senses the nation’s rapid decline. Over 15% are unemployed, under-employed or have dropped out of the work force. Instead of holding government and special interests to account, Friedman and Mandelbaum give us sugar coated history and a pep rally. For shame. These two guys know better.
