Regarding our economic woes, your editorial
asks: "Oh, Boy, How Did We Get Into This?". I'm no Nobel
Laureate, but the problem -- and its solution -- are painfully
obvious to me.
When we say our economy is "slow" it means
that there is not enough money in circulation purchasing our
goods and services. All wages, salaries, repayments of loans,
investments in research and development, taxes, and profits
ultimately come from sales (as any kid with a lemonade stand can
testify): Most of the Gross Domestic Product (about 2/3) is
retail sales. In short, the economy is inherently demand-sided;
and Bush was right 12 years ago in condemning supply-side
economics as "voodoo economics".
That's the problem in a nutshell, so what's
the solution? Well, in order to get more money into circulation
we can 1) print more money (leading to hyper-inflation, as in
pre-Nazi Germany), 2) borrow more money (the "solution" of
the '80s), or 3) redistribute the money already in our
economy.
With the Cold War over (at least as long as
Russia remains "stable"), we can shift much spending from
military to domestic needs; and because the "multiplier
effect" of social spending traditionally is higher than that
of defense spending, we should "get more bang from our
buck".
In addition, as you have reported, something
like 90% of the wealth of our country is in the hands of 10% of
our people. Because richer people can save most of their income
while we poorer people (including the middle class) must spend
most of our income, a "top heavy" distribution of wealth not
only causes hardships and resentments (as flared up in the Los
Angeles riot) but also a net decrease in spending, the lifeblood
of our economy.
Thus, the current trend towards reducing
progressive income taxes for the rich while increasing
regressive sales taxes and users fees -- and decreasing public
services -- for the poor and middle class courts not only
social upheaval but also economic disaster.
An economy is built from the ground up...not "trickle down".
The false prosperity of the Roaring '20s
likewise produced the Great Depression of the '30s (and the
World War of the '40s). Unless we learn from history...well,
you know.