The middle class is being bamboozled and taken to the cleaners — by both parties
By Courtland Milloy,
Someone to explain why Corporate America is raking in the dough but not creating jobs; why banks are sitting on tons of cash but not making loans; how a single Wall Street hedge fund manager could earn $4.9 billion last year — that’s about $155 a second — while most of us barely make ends meet.
I’ve tried to figure all of this out by reading business publications, listening to some economic experts and even watching the Suze Orman personal finance TV show. But the only answer I come up with is that the middle class is being bamboozled and taken to the cleaners — by Democratic and Republican leaders alike.
Surely that can’t be right. This country is not some oligarchy where workers fight over crumbs while the fat cats kick back and enjoy the show. Is it?
After pulling Wall Street from the brink of collapse two years ago, taxpayers were told that it was our turn to get some financial relief. Jobs would be created, loans made, homes saved.
Here’s what Christina Romer said in December 2009, when she was chairwoman of President Obama’s Council of Economic Advisers:
“Instead of taxpayer money going to the big banks that helped cause the current crisis, it’s coming back from them,” she told us. “Earlier this month, we learned that there will be more than $200 billion of savings to the American people through the TARP program — savings that the president has proposed putting to work helping Main Street instead of Wall Street.”
Guess who laughed all the way to the bank on that one? The bank.
Last year, the top 25 Wall Street hedge fund managers made $22 billion and change, according to a survey by AR Magazine. Not in a decade; not in your or my lifetime. In one year. That’s nearly five times as much as the D.C. government’s annual budget.
In just the past two quarters, Corporate America socked away nearly $2 trillion in profits. The reason most often given for not using those profits to create jobs is that the demand for goods is too low to warrant a larger workforce.
Help! I thought that demand for goods just might rise if people had the money to buy the goods — and that they’d have money if they had jobs.
Harold Meyerson wrote in The Washington Post last week that 75 percent of corporate profits in recent years have come from a decline in wages and benefits. In other words, the incentive for business is to destroy jobs, not create them.
Our pain is their gain.
Poverty is up, wages are down and another round of home foreclosures is in the works. And nothing hurts like being homeless.
Early on in his administration, Obama promised to do something to help keep families in their homes. Then, this month at a town hall event, he said the housing market was too big for a federal program to solve the problem and declared, “Some folks just bought more home than they could afford, and probably they’re going to be better off renting.”
No wonder more than a third of Americans have lost confidence in Obama’s ability to improve the economy, according to a recent Washington Post-ABC News poll. Nearly half of the country says jobs are “very difficult” to find, and 85 percent are “just getting by” or “falling behind.”
Although most still blame former president George W. Bush for creating the mess, the high hopes that Obama could fix it have been dashed.
“The most recent data attest to the continuing weakness of the labor market,” Ben Bernanke, chairman of the Federal Reserve, told a congressional committee last week. According to an account in The Post, Bernanke “raised the possibility of further action to try to combat rising joblessness.”
People have been out of work for so long they are losing their job skills, and now, after years of promises that help was on the way, it’s only possible that something might be done?
I guess this is where the Republicans come in with their recently released “Plan for America’s Job Creators.” According to the plan, the problem is that “Washington” implemented “backwards fiscal policies that have stalled the economy, slowed innovation and destroyed jobs.”
But “Washington” was being run by Republicans. That’s who implemented the policies that tanked the economy. And their plan calls for implementing them again.
Help is needed to understand why more Americans aren’t fed up with this political mumbo jumbo and economic gobbledygook.