Trickle economics—Up or down?

“Suppose you were an idiot, and suppose you were a member of Congress; but I repeat myself.”—MT

Trickle-down economics is closely identified with the economic policies known as “Reaganomics.” Reagan’s budget director David Stockman, championed tax cuts at first but then became skeptical, and told journalist William Greider that, “supply-side economics is the trickle-down idea: It’s kind of hard to sell ‘trickle down,’ so the supply-side formula was the only way to get a tax policy that was really ‘trickle down.’”

The idea seemed to make sense, in theory, due to the fundamental economic relationship between supply and demand. The greater the demand (assuming industrial response) there would be job creation to provide rising supply. However, this principle ceases to function when demand is suppressed when consumers have decreasing disposable income (as during an economic downturn). The only way to correct the situation is with a stimulus program OR if those with wealth incur front-loaded risk and hire (or don’t fire) more people, who then have more disposable income, leading to increased demand. Of course risk aversion is also a sound economic principle and there are very few wealthy people who get excited about incurring more risk. 

But then we must consider the most wealthy of all: the U.S. Government, that is unfortunately controlled by a bunch of congressional idiots beholden to wealthy donors. The Uncommon Sense here is that somebody must take a risk and prime the pump of economic activity to jump-start job creation, putting money in the hands of the people who create demand in the first place. Neither the current elite nor ruling members of The House of Representatives are willing to take that risk, but instead have chosen to slash and burn the very people who could start the economic engine moving. The consequence is that the poor get poorer, the rich get richer and the middle class is joining those at the bottom. There is no “trickle.” There is just fattening the wealthy lambs at their own peril. 

Republican’s have attributed the slogan to Democrats in the 1980s as a way to attack Reagan’s economic policies. But students of history know the term first appeared long before during the Great Depression in 1932 when Will Rogers said of the Republican President, “The money was all appropriated for the top in the hopes that it would trickle down to the needy. Mr. Hoover didn’t know that money trickled up. Give it to the people at the bottom and the people at the top will have it before night, anyhow. But it will at least have passed through the poor fellow’s hands.” It took Hoover’s successor Franklin Delano Roosevelt to have the vision, fortitude and courage to turn this theory upside down and start the long road out of the worst depression we have ever experienced. Unfortunately the trickle-down nonsense has reemerged, packaged in the disguise of the “makers and the takers,” and once more the policies that created and sustained our economic woes have taken root all over again. To suggest that those who enable wealth are inferior to those who acquire it, is like saying a house is built by itself for the occupants who live in it.

Ignorance ain't bliss.

There’s a certain renaissance now days in the wisdom of MT, which shouldn’t be surprising given the lack of moral leadership in the world today. He was fearless in castigating any and all whom he deemed unworthy of human potential and often said he had more confidence in four legged animals and not so much in human ones. He once said “Often it does seem such a pity that Noah and his party did not miss the boat,” and that if a man was combined with a cat, the cat would be lesser and man the better.

For these reasons, and others, he was considered to be uncommonly wise and thought, for the most part, that the rest of us displayed consistent ignorance, particularly when it came to politicians. His even handed critiques were understood widely since he dealt with everyday foolishness and considered it unseemly to argue with fools. He said, “Never argue with stupid people. They will drag you down to their level and then beat you with experience.”

If MT was compared to The Buddha it would not be inaccurate to say they shared a common reputation for being wise and recognizing ignorance as a core human problem. When The Buddha was asked: “What is that smothers the world? What makes the world so hard to see? What would you say pollutes the world and threatens it the most?” He said, “It is ignorance which smothers and it heedlessness and greed which make the world invisible. The hunger of desire pollutes the world, and the great source of fear is the pain of suffering.” FDR said something more practical, but quite similar and no less wise. He said, “We have always known that heedless self-interest is bad morals; we now know it is bad economics.” Politicians today largely ignore his observation and imply that the opposite is the case (e.g. self-interest/greed is good and translates into good economics). 

The wisdom of MT is more readily known than that of The Buddha. In a certain sense MT’s wisdom might be thought of as symptomatic whereas the wisdom of The Buddha causative. Often times we are drawn to the outside wrapping of a package and less to what the package contains. We are enamored with style and not so much substance, and perhaps for that reason are drawn to the uncommon wisdom of MT instead of the profound wisdom of The Buddha.

MT’s manner was one of scathing assaults on ignorant people and The Buddha’s one of deep sadness and compassion. He understood the source of human failings and recognized why we act in ways that appear to be sheer stupidity. The cause was of little concern to MT. He was a shrewd satirist and commentator on actions, often times without understanding or giving consideration to what led to them.

Before launching Uncommon Sense, barely a month ago, I wrote another blog for seven years regarding the wisdom of The Buddha. It took that much time, with a collection of 280 posts, to gain a worldwide audience of over 30,000 readers. Yet in little over one month Uncommon Sense has garnered an audience of over 1,000 readers. At that rate, if continued, Uncommon Sense will reach the same high bar in one percent of the time. 

That is a telling observation and speaks to the difference in grasping satirical humor instead of a profound understanding of why we are, as MT puts it, pathetic: “Everything human is pathetic. The secret source of humor itself is not joy but sorrow. There is no humor in heaven.” In any event we need both: the indiscriminate scolding for everyday foolishness and a deeper understanding that leads us all away from stupidity and onto a higher moral plain.

“Laws control the lesser man. Right conduct controls the greater one.”—MT

Some take comfort in the rigid structure of laws, which seem to provide relief from taking responsibility for their own actions. It appears easy to avoid right conduct when the law is on the side of wrong doing and protecting vested interests.

Merely following an unjust law does nothing more than to perpetuate injustice. The more we oppose injustice, the more we demonstrate the courage of internal moral resolve. The more we embrace injustice, the more we demonstrate cowardice of a corrupted and vacuous spirit of righteousness.

It was Martin Luther King, Jr who reminded us that, “An individual who breaks a law that conscience tells him is unjust, and who willingly accepts the penalty of imprisonment in order to arouse the consciousness of the community over its injustice, is in reality expressing the highest respect for the law.”

That said, violence employed toward the end of rectifying wrong is neither noble nor productive. The result is more violence. Gandhi said, “I object to violence because when it appears to do good, the good is only temporary; the evil it does is permanent.”

Three years ago the non-violent Occupy Wall Street protest movement began in New York City’s Wall Street financial district. The movement received global attention and spawned other worldwide Occupy movements against social and economic inequality. The main issues addressed by Occupy Wall Street were social and economic inequality, greed, corruption plus the perceived undue influence of corporations on government—particularly from the financial services sector. After many months the movement was forcibly disbanded by those who wished to avoid reform and the effort diminished to a burning ember, but is now being revived.

The result of the setback has allowed greed and corruption to flourish even more. The clock has now moved forward three years and the flaws have grown into monstrous forms of social inequity with the gap between the super wealthy and the rest of humanity at unprecedented levels. A recent Huffington Post article thoroughly examined this imbalance and concluded that unless corrected, we face dire consequences for virtually every problem facing our society.

I encourage everyone to read the article and contemplate where your moral compass leads. The more we oppose injustice, the more we demonstrate the courage of internal moral resolve. The more we embrace injustice, the more we demonstrate cowardice of a corrupted and vacuous spirit of righteousness. This is not only a moral issue, it is one of societal continuation.

“A problem is never significant…until it becomes your own.”

“No occurrence is sole and solitary, but is merely a repetition of a thing which has happened before, and perhaps often.”—MT

• People showing no empathy toward those less fortunate, until they join their ranks.
• People with adequate health insurance not identifying with those who don’t, until they don’t either.
• Parents opposing gay people, until their own child turns out to be gay.
• Seeing war as a glorious endeavor, until they experience it themselves or lose a loved one to it.

These and an untold number of other examples show us all that we are not our brother’s keeper—we are our brother, sister, mother, father or children. Some will say, “I am only responsible for myself and those of my alliances,” forgetting that their fundamental alliance is with humanity. Lest we think ignoring a problem gets us off the hook, more than 1,900 years ago a Greek philosopher noted: “The omission of good is no less reprehensible than the commission of evil.”

Could’a, would’a, should’a

The face of sorrow.

If only… Fewer words are more remorseful. If a  picture is worth ten thousand words then few say more than this. 
Click here.

“It is the highest form of self-respect to admit our errors and mistakes and make amends for them. To make a mistake is only an error in judgment, but to adhere to it when it is discovered shows infirmity of character.”—Dale Turner

“Twenty years from now you will be more disappointed by the things that you didn’t do than by the ones you did. So throw off the bowlines. Sail away from the safe harbor. Catch the trade winds in your sails. Explore. Dream. Discover.”—MT

No one can change yesterday and only you can change today. Have a good day and do your best to not be sorry tomorrow.

“I was seldom able to see an opportunity until it had ceased to be one.”—MT

Our burning house...

Hindsight ain’t worth a damn, unless of course you prefer walking backwards. MT didn’t say that, but he should have. There are some things that, if not noticed in a timely fashion, are not worth noticing at all, such as your house burning down with you in it, or becoming aware that global climate change has moved past the tipping point while you remained unaware. MT said, “Climate is what we expect, weather is what we get.” Now days, weather is what we don’t expect because we refused to accept climate as it is.

Opportunities are, as MT observes, rarely seen as such. Instead they might be considered annoyances or inconveniences that get in the way of our preconceived agendas. These account for the peculiar human condition known as denial: the inability to face reality as it is rather than as we wish it to be.

A contemporary Japanese writer said, “I’m not afraid to die. What I’m afraid of is having reality get the better of me, of having reality leave me behind.” Nobody wants to be left behind, and all of us prefer to consider ourselves as proactive instead of reactive.

There are different kinds of denial. There are denial of facts, denial of responsibility, denial of impact, denial of cycles, and denial of awareness. Perhaps the most egregious of all is denial of denial—the refusal to admit that we err. On the other hand, “When we remember we are all mad, the mysteries disappear and life stands explained.”

Death of the turtle.

Shell and no head.

Last week Paul Krugman wrote an editorial in the NY Times called “The Inflation Cult,” in which he compared the soothsayers of inflation to members of a cult whose dogma overrides emerging facts. Their mantras persist in contradiction of reality. Being an acknowledged economist, it’s fitting for Krugman to apply this view to economics. I enjoy Krugman and agree with his perspectives most of the time. 

When I read the editorial I thought that his yardstick was vastly more applicable than restricted to economics. This characteristic of dogma covers virtually all human conduct  and could be described as a turtle that sticks it’s head out once, announces any perspective whatsoever, and then withdraws its head, never to be seen again.

In light of the ISIS debacle growing throughout the Middle East, the pattern seems particularly appropriate. We all seem to have short memories and tend to ignore self-incriminating evidence. When the current situation is carefully examined, only the most forgetful and dogmatically inclined can possibly ignore our culpability in creating this mess. There is a direct line flowing backwards from the present to the past destruction of the Iraqi infrastructure during our invasion—leaving hundreds to thousands of previously employed Iraqis without any means of support—and our subsequent betrayal of the Sunnis during and after the emergence of the “Sons of Iraq” program. While initially sponsored by the US military under the auspices of Gen. Stanley McChrystal, the Sons of Iraq helped turn the tide against Al Qaeda in Iraq but then became our worst nightmare.

In 2005 during the battles to destroy Al Qaeda in Iraq, the Sunni tribe of Albu Mahals was being forced out of their territory by the Al Salmani tribe allied with Al Qaeda. The Albu Mahals proposed an alliance with a local USMC Battalion, and in time, this became known as the Anbar Awakening (Sunni Awakening) to counter the influence of foreign Al-Qaeda fighters. Between that point of initiation in 2005 until October 2008, these Sunni forces, 54,000 in number, were our allies and “boots on the ground.” We trained, armed, paid and then abandoned them into the hands of their Shia enemies under the control of Maliki when we left. That transfer of responsibility from the U.S. to the Iraqi Shia government was considered by many (if not most) Sunnis as a betrayal by the U.S. Army. Not unexpectedly, the remnants of that force migrated into the emerging creation of ISIS (Islamic State of Iraq and Syria). Once our allies, now our enemies, were lead step by step to a sectarian civil war which we provoked. During the American Civil War, the French found themselves struggling with a similar dilemma but wisely chose to not take sides.

So now we continue, as the turtle with it’s withdrawn head, by holding onto the flawed thinking that (a) we bear no responsibility for what is occurring and (b) we will once again form another “Sunni Awakening” amongst the same people we betrayed before. The road from Mission Accomplished to ISIS is clear and indisputable and unless we take our heads out of our shell there is a good chance we will die there.

“Man is the only animal that deals in that atrocity of atrocities: War. He is the only one that gathers his brethren about him and goes forth in cold blood and calm pulse to exterminate his kind. He is the only animal that for sordid wages will march out, and help to slaughter strangers of his own species who have done him no harm and with whom he has no quarrel. And in the intervals between campaigns he washes the blood off his hands and works for ‘the universal brotherhood of man’—with his mouth.”—MT