“Once upon a time, the rich were taxed fairly.”

Thank you Straight Goods for passing on the above video, via: Once upon a time, the rich were taxed fairly » StraightGoods.ca.

Well, There’s not much about the Ed Asner-narrated video, above, to disagree with. I enjoyed it. If there’s any problem with it, it’s that Ed Asner won’t be a familiar name to lots of younger people. The impact would be greater if it was a Brad Pitt or Daniel Craig narrating. Then again, I’m sick of celebs. Just when you are a little encouraged by the sight of someone rich and famous admitting that their class (in some ways anyway) is letting you, and the 99%, down, you find out that they are materially supporting the fascist system they are ‘enjoying’ criticizing. You find out that they’ve been active in electing a Barack Obama or whatever flavor of political hero is popular at the moment.

We have seen enough lately, all over, to know that electoral politics is not only not the answer, but it’s absolutely part of the problem. It’s a big lie told by the 1% that electoral politics is proof that we have democracy and needn’t look for it. There are a few big lies that the Right can’t stop telling for that would be tantamount to pulling at a loose thread on a sweater. It could potentially completely unravel a system that benefits the 1% of parasites on this planet and leave them without their financially warm sweater in this cold, barbaric, neoliberal capitalist order they’ve constructed and help to maintain. Can’t have that.

* “Corruption Inquiry To Name Former High-Ranking Quebec Liberals” – CBC via HuffPost

* “Everythinggate: Perfect storm lands Alberta premier in shark-infested waters!” – David Climenhaga

* “ORNGE air ambulance service now run by Ontario deputy minister” – By Kevin Donovan and Rob Ferguson

Another one of those big lies is that governments have no money. You can’t claim that there’s a deficit, for example, if the reason for the deficit is that YOU CAUSED IT! I don’t ask politicians to create deficits, and certainly not when it benefits tax evaders and hurts me and my friends and family. And I know that my friends and family members don’t ask their elected represenatives to create deficits because when I talk to them about this stuff I ask them. The only ones who want deficits, it turns out, are the same politicians and rightwingers who tell us that they are evil.

* “Add It Up: Taxes Avoided by the Rich Could Pay Off the Deficit” by Paul Buchheit

And, as Linda McQuaig explains in her amazing book titled “Shooting The Hippo – Death By Deficit And Other Canadian Myths,” deficits caused by (captured) governments helps them to make the case that they must cut social spending, something that a segment of the business community wants. It also lowers citizens’ expectations as they absorb the news that their governments are broke. It sets things up so that privatizers can more easily swoop down and steal public assets that the people don’t believe their governments can afford. And there is something else. Deficits, in fact, arise not from social spending as much as from mismanagement by captured governments that see special interests – corporations, the rich – as their true constituencies. Governments shovel out endless tax cuts to their partners in the private sector, even when those partners are criminal and even when they are using offshore tax havens, that drain treasuries.

If those handouts benefitted all of society, then a case could possibly be made for allowing them. However, Those handouts only benefit a minority and hurt the majority. Finally, The segment of the population that has money to invest (as well as outsiders who can buy our bonds and make money from our higher dollar) desires price stability so that the value of their investments doesn’t drop over time. To get that ‘our’ central bank creates tight (less) money, which pushes up the cost of borrowing, lowers inflation (with wages and prices dropping) and raises ‘real’ interest rates. The lenders benefit and the wider economy stalls. Small businesses can’t expand and hire workers who pay taxes. Some businesses go out of business. Spending in the economy slows and government revenues, from the taxes no longer getting paid by businesses and workers, shrink as a result.

The holders of financial assets in society benefit from the high real interest rates (the interest rate minus the inflation rate, pg 84) that come from low inflation, a part of a policy regime that includes other elements as well. You can’t really successfully attack the deficit ‘and’ keep real interest rates high. The policy bundle at issue here is: 1) actions to keep inflation experimentally low, which raises real interest rates and leads to recessions 2) deficit reduction through social spending cuts, which is what the rich and powerful want, but not what is necessary. All the while, governments are cutting taxes for the rich and for corporations, which help to cause deficits. As long as you aren’t going to deprive the rich foreign investors and rich Canadians of their healthy returns on investments, via the high real interest rates, then you, that is, your class, might as well also benefit from the deficits that result. You can never tell the truth about them either, for then that whole cozy scam would unravel.

Besides the price stability that net lenders in society desire and achieve with a tight money/ high interest rate policy, other capitalists can more easily buy (steal) public assets when governments can claim that they can’t afford them. And then there’s the effect high unemployment has on workers and their wage demands that the war on inflation leads to. High unemployment disciplines labor, partly by weakening unions and partly because with fewer good paying jobs around workers are under more pressure to take crap, and crap wages, from their employers. This is what elite democracy looks like. And take note, We are not talking about truly high inflation. Studies show that inflation that is around 4% just isn’t a problem. It’s when it starts pushing up to 12.5% (Canada in 1981) or higher that you’ve got a serious problem. We may have had a bit of an inflation problem in the early 80s, when Gerald Bouey was the Canadian central bank governor, but we didn’t have such a problem when, in 1987, the myopic John Crow, with support from his uncaring political partner, finance minister Michael Wilson, started his effort to bring inflation down to zero all for the approval of special, powerful interests and regardless what it did to the majority of Canadians. It was a crime.

Neoliberal, or corporatist, governments (which are the common sort today) are complicit in manufacturing business-inspired crises generally and in government revenue generation specifically, which they use to carry out a neoliberal agenda of privatization and deregulation (giving too much freedom to exploitative businesses at the expense of citizens). The propaganda, accordingly, is that governments are spending beyond their means and shouldn’t be in the business of building and maintaining society anyway. Leave that to the more efficient business sector whose businesses are ‘for profit’. Profit motivated businesses in a deregulated environment too easily rob customers by giving them too little for too much money. That’s especially a problem when it happens in areas that were in the public realm (like water services, waste disposal, health and education services, policing etc). Owners can make more money by cost cutting and a culture of greed encourages them to do so, even beyond what is reasonable. When the service is for profit, funds that otherwise would go back into improving the service, or just maintaining it properly, get diverted into the pockets of the owner(s). It’s not rocket science. That’s a negative sort of cost cutting. No one argues for unecessary spending in or out of the public sector. But the capitalist class does a negative sort of cost cutting in it’s pursuit of profits. Perhaps that wouldn’t be such a problem if there were no greed and no criminal-minded capitalists.

* “More Dead Money,” by Erin Weir (The Progressive Economics Forum)

With A Good Deficit You Can See Forever
from “Alien Invasion – How the Harris Tories Mismanaged Ontario,” edited by Ruth Cohen (2001) by Adrian Adamson

“On one subject everyone will agree. The deficit is a disaster and must be lowered, through wage rollbacks if necessary. The last time so many people agreed, it was over another disaster… the 1970s energy crisis. The world was going to run out of oil and we were all going to freeze in the dark…

“Twenty years ago the corporate class in Canada agreed on one thing: wages in Canada were outrageous, and something had to be done about them…

“Stage one is to secure free trade with the United States, where there are weak unions, low wages and no social programs. That should cool off wage demands…

“The second stage is tax reform. Lower the taxes on the rich and on corporations. High taxes on us lead to a lower income, which reduces our incentive to work and invest. So, make the rich richer and they’ll work harder, invest more and create jobs. (Of course, as everyone knows, if you make the poor richer, they will work less. So to get the poor to work harder, cut their wages; to make the rich work harder, raise their incomes. Funny how that works, but then we aren’t really the same species, are we.)…

“In the third stage the realization hits that if we continue government spending and cutting revenues, we are going to end up with a budget deficit. We can pretend total surprise: “Who would ever have predicted a budget deficit?” But with a budget deficit we will have to cut spending, which means laying off workers. This will cut tax revenues and increase spending on unemployment benefits, so the deficit gets worse, not better! “Who would have predicted it?” But, don’t worry. This will produce the Golden Key: the budget crisis.

“The fourth stage occurs when we finally have the Golden Key in hand, the key that will unlock every door. With a good budget crisis running we can do almost anything we want…

“Finally, there is stage five. With a proper budget crisis and wages rolled back a decade or so, we have the final master stroke. A generalized wage collapse. Wages in Canada will fall to the bare subsistence level, where they were in the 1930s. And we will make as much money as they do in Third World dictatorships. It’s that simple!”

From “Silent Coup – Confronting The Big Business Takeover Of Canada,” by Tony Clarke (1997), the following:

“One of the first major studies commissioned by the Trilateralists had to do with the crisis of democratic governance which had become a major problem for global corporations…

“Although the report did not call for outright dismantling of the welfare state, the authors did propose some radical changes in the model of democratic governance. The solution to the crisis, they said, was a stronger government in a weaker democratic framework. In order to effectively coordinate and plan changes in national economies required to facilitate transnational investement, governments needed to have more centralized authority and be less susceptible to the diverse demands of citizens’ movements.” -pg 45

&

“Perhaps the greatest hoax promoted by the media moguls in recent years has been the notion that Canada’s debt woes were caused by overspending on social programs. Not only did the media propagate this myth, but they almost totally ignored the real causes disclosed by non-business studies (including Statistics Canada), such as the Bank of Canada’s persistently high interest rate policies and the massive drain on public revenues due to lower corporate tax rates and high unemployment.” -pg 129

“Deficitism And Neo-Conservatism In Ontario,” by Michelle Weinroth
from Open For Business, Closed To People” edited by Diana Ralph, André Régimbald and Nérée St-Amand (1997)

“But whereas [Mike] Harris and his colleagues cast aspersions on the [Bob] Rae government, they refused to acknowledge that the debt did not originate in the latter’s excessive spending, but in the Conservative policies of the Mulroney years: 1) former Bank of Canada governor John Crow’s monetarist policy (he insisted that the rate of inflation be lowered to zero) forced interest rates to rocket, thus aggravating interest on the debt (Chorney 1989; Jackson 1990, 1990a); 2)the recession of the 1980s and 1990s and the Free Trade Agreement with the U.S. caused a massive loss of jobs, especially in the manufacturing sector; the consequent rise in unemployment meant that government spending on social assistance and other programs (e.g. medicare) increased while less money went to the public purse in the form of tax revenues (cf. Barlow and Campbell 1991; Bellemare and Poulin-Simon 1994; Campbell 1993; Cohen 1995); 3) the federal government slashed it’ social transfers to the provinces and notably to Ontario, weakening Rae’s financial power…

“Harris never waxed lyrical or messianic over the deficit crisis. His main focus was on getting down to business (literally) and getting the “clean-up job” done. The pragmatics of reducing the deficit consisted in relentless cutbacks, delivered in sanguine fashion. Nonetheless, Harris’s deficitst propaganda applied the basic paradigms of deficitism: he retained the crucial element of terror which underpinned the Liberals’ rhetoric. Admittedly, he did not elaborate as fully on the national emergency as did the federal ideologues, but with spurious boy scout catechisms, he reminded Ontarians that we are “in this together,” that “[w]e must all share in the sacrifices if we are to share in the gains achieved by getting Ontario back on track” (Harris 1995). Never mind that austerity measures “savage the poor today and reward the rich tomorrow” (Walkom 1995: A9). Finally he transposed the mood of terror from a discourse of crisis to that of taxation, into the formidable character of the “enemy of the people”: the Leviathan of big government.” -pages 58 & 59

When you fail to tax fairly, to say the least, that creates deficits. Endless tax cuts (and subsidies and tax expenditures [hand outs]) to tax-evading corporations and special interests cause deficits or deficiencies in the treasuries of our various governments. Spending, when it’s fingered as the culprit, is usually shown to be not the fiscal problem while it also happens to be, with some exceptions (subsidies to the fossil fuel industry, the nuclear industry and the military-industrial-complex and foreign companies buying Canadian assets), what people want, need and, in a word, what makes civilization civilized. But the individuals and their organizations within the neoliberal movement, which has claimed most politicians, governments and capitalists as members, are not civilized, even if they are clever.

So clever that they have broken the liveable earth upon which all of us, good and evil, depend for life. But that’s what goats do. The Christian Bible refers to a time when sheep-like people will be separated from goat-like people. Goats, by their nature, are difficult to control and pushy. Which is okay for an actual goat and may make it charming. But in people, who are supposed to be different, those are not endearing qualities. We, as a people, live and prosper when we work together, following the rules we all agree to, including rules about taxes. But the law and order crowd is perverted, if nothing else. There isn’t a law, written or unwritten, they don’t like to break (for ‘good’ reasons). When you break the rules that everyone’s agreed to, you discover that it places you in a position of dominance in society. From that position, you can therefore guarantee outcomes, including economic outcomes. And in a monstrous money system (which God will make it’s creators answer for), such dominance, freedom and power is a desirable thing. Who wouldn’t want the ability to pay to escape being eaten by a monster?!

Some of you will remember the Mary Tyler Moore show. They don’t make tv shows like they used to. It’s one of countless great old shows that were funny and helped you get through your work week. Ed Asner played Lou Grant, a crotchety news room boss. Everyone in the news room was a character and the show had character. For your edification – because who can dwell on this political crap 24 hours a day? – I present to you, courtesy of YouTube and the show’s creators, the following episode of the Mary Tyer Moore show. Enjoy!:

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