Deficits, Unemployment, and Bear Markets; The Fruit of Tax Cuts and Deregulation

Posted by politicalpartypooper on April 8, 2010

Republicans like to tell us that deregulation is good for business; that it causes more competition and lower prices for consumers.

But what does recent history tell us?

For the power industry, it tells us about Enron, and how they cheated, lied, stole, and strong-armed their way into a position where the world’s sixth largest economy was at their mercy for its electrical needs.  Enron created an artificial power shortage, and rolling blackouts swept California at a time when that state had far more than enough power generation capacity to meet its needs.   Enron used those blackouts to charge as much as twenty-times the actual going rate for electricity.   The story of Enron will probably never be forgotten; it’s one of the worst examples that deregulation proponents to have to deal with.

Let’s see, for the finance industry, where do I begin?  Where does it end?  Credit default swaps, an unregulated security basically brought down the entire financial sector in 2008.  Nearly every major bank in America required a bailout.  Also, nearly every major bank in America cooked its books to some extent to make their stock more attractive than their actual profits could back up.  It turned out that commercial and investment banks were built on a house of cards, and when the check was due, they couldn’t pay their tab. America had to bailout huge banks for fear that if we didn’t, the world’s economy would collapse. The rescinding of Glass-Steagall created a good-ol-boys network of banks too big for their britches, while executives at these firms took extremely shortsighted views of what it meant to build a profitable, stable company.

So..tell us again how deregulation is good for business?  Tell us again how deregulation creates jobs and competition; how it lowers costs to consumers?

The only history of deregulation I can think of turned out to be a nightmare for Americans both times, thanks to Enron and banks-too-big-to-fail.  One in five American males is unemployed.  Not just UNDER-employed.  UN-employed. That is as a result of the Wall Street meltdown.

Conservatives gripe about the progressive tax rate and the era of regulation that stemmed from the Great Depression.

Well, answer me this:  The period between 1945 and 1986 is generally known for economic stability, a growing, hard-working, ethical and moral middle class, and an achievable American Dream.  Since tax rates have been cut drastically and deregulation has taken hold, what three things  is America known for?

I’ll give you a hint.  The first answer starts with d-e-f-i-c-i-…and the second answer starts with u-n-e-m-p-l-o-y-m-e-n… and the third answer begins with b-e-a-r-m-a-r-k-e…

Think you can come up with the answers?  Conservatives want more of that.  I’m not sure what Liberals want.  I don’t think they know either.

I want a policy that uses the best of all ideas, rather than a policy that sticks to the failed, stale ideologies of the Nineteenth Century, like the two parties use.


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