Reversing the Income Flow

It wasn’t that much of a concern to ordinary people some thirty years ago when President Reagan cut taxes on the rich and made his speeches on TV about how “Supply Side Economics” would benefit everybody. After all, ordinary people have other concerns, like dealing with their own household budgets. But now the results are in. We’ve gotten to a position where ordinary people can feel the effects.

Just installing a structural bias in government policy apparently wasn’t enough, and recent greed has exposed the process of how the rich have been looting the US tax funds. Not only were billions of dollars unaccounted for in the Iraq War, but billions went to a small group of companies that caused a world-wide economic crisis and then cried to be bailed-out.

We failed to pay attention to history, or at least to insist that it not be repeated. The recent near-depression isn’t the first crash tied to “trickle-down" economics. Economist John Kenneth Galbraith attributed the Panic of 1896 to the same kind of economic policies. So we didn’t pay attention, and now there is rampant unemployment, “Occupy Wall Street” protests in the streets and a “Poverty Tour” making the rounds. These are calls to reverse the income flow which has carried all that money to the top 10%, and more specifically to the top 1% of the wealthiest in the US.

Proposals for raising taxes on the wealthy have provoked complaints about socialism and “forcibly seizing” wealth from the rich to give to the poor. The truth is that going too far in either the direction of unregulated capitalism or stagnating socialism is bad for the country—we need the middle road. However, the excesses of the last thirty years need to be undone. We need to raise taxes on the wealthy, and institute polices that use the taxpayer’s money for neglected infrastructure and research and development. We need policies that regulate companies that make sure they behave responsibly and don’t take all the profit while transferring all the costs of their business to the taxpayers.

This has all been proposed, but so far it’s been blocked. That means we need to look at breaking the hold that the rich have on our politics. Campaign reform, anyone?

If Math Scores Are Rising, Why Do We Need to Import High Tech Workers?

In the last few years, US schools and teachers are under increasing pressure to raise scores in reading, writing and math. Supposedly this focus on test scores is to make the US high school graduates more competitive in the world jobs marketplace. So, is it working?

Studies show that US test scores are rising, and unemployment is rampant. High tech manufacturing firms are complaining about not having qualified applicants and requesting to hire from overseas. US high school graduates with good math scores are working as cashiers at Walmart. Hmmm, maybe there’s something wrong with the education plan.

Well, there are a couple of things going on. First and foremost, it’s cheaper to hire from overseas. There are logistical problems to moving manufacturing plants to say, Asia, where the labor is cheap, so the latest trend is for companies to build their plant in the US--but then they have to deal with the high cost of labor. This problem can easily be overcome by importing labor that is willing to work for lower wages. Immigrants are willing to bear the high cost of specific technical education in order to hold a job in the US, where monetary exchange rates make their wages seem high.

And next, there’s currently little opportunity for US students with good test scores or even a college degree to find experience or specific technical education to qualify them for the available job openings. Those technical job postings are specific, asking for things like experience with a particular software release, and with the clear expectation that the new employee can start work right now at a high rate of productivity and with no on-the-job training. By insisting on these qualifications, companies ensure that their job openings remain open.

What’s wrong with the education plan is that it isn’t comprehensive enough--it doesn't provide the opportunities. A national focus on reading, writing and math doesn’t do any good unless there is a means to get talented students into the available job positions. Solutions? Tax or other incentives for companies to hire, and if necessary, train US graduates for their job openings. Technical schools that develop relationships with companies to train workers for specific needs. Opportunity for US graduates. Really, without the expectation of good jobs, why should kids bother with all that homework? Social media is much more fun.