Donald Andrew Henson II

Posts Tagged ‘Trickle-down economics’

Christian Economics 101: Starve the Poor

In American Economy, American Society, Religion and Money on March 21, 2017 at 11:56 pm

I started university a bit later than most, only after I had already tried my hand at a couple of different careers. Retail management was my first full-time foray into the workplace, car sales my second. With that background, it made sense to me that I should be a business major, so I signed up for all of the usual courses required of the freshman BBA, confident that my experience in the real world would put me a step or two ahead of my classmates.

Only problem was – I found that business, as it’s taught at university, has very little connection to the real world.

Consider my first day in Economics 101. I’ll never forget the professor building up the fact that there were ten basic principles that formed the theoretical basis upon which everything else we were to study that semester would rely. After several minutes of stressing to us how important it was for us to know these principles, he presented a slide with the first one:

Number 1 – People always make rational and logical decisions.

Needless to say, I began to have my doubts almost immediately. Of course people make irrational and deluded decisions all the time, especially with money. A lot of what I heard in the classroom didn’t match up with my personal experience in the workplace. I mean, the business model for selling new Dodge cars in the late 80s pretty much depended on the fact that the customer wouldn’t make a logical decision.

Another professor fancied himself a Marxist; yet another was a supply-side disciple. About half of my classmates lacked the ability to write a coherent paragraph, or to support an opinion with facts (which must be common even at Wharton).

I learned that there are a lot of really dumb and dangerous ideas floating around, even at the top business schools. Some of these, like the aforementioned supply-side or ‘trickle-down’ economic theory have so infected conservative political thought that all the facts in the world can’t seem to cure them – Nobel prize-winners like Paul Krugman are just considered partisan.

But if you want to hear some really horrible economic ideas, instead of going to business school, you might want to visit your local church. In fact, I believe that ‘Christian Economics’ is the main reason the GOP is able to continue persuading working class voters to vote against their own economic interests.

Jesus and the money changers

Jesus beating up the bankers – not the poor.

Listen to pretty much any radio preacher or TV evangelist, or google ‘Bible economics’ and you’ll find that the church has a lot to say about what the American economy should look like – and it ain’t pretty. I’ve chosen sections from a website called Let God Be True as a good (bad?) example, not only because the site has a lot to say about work, taxes, and economics, but also because the views espoused would be pretty typical of what you’d hear Sunday morning if you attended church in a Red State. The view doesn’t so much seem to be that work proves us to be the elect of God – not pure Calvinism – but it’s clear that a ‘sluggard’ isn’t fulfilling his Christian duty.

You’ll really want to read quite a few pages of this site if you truly want to understand where GOP/Red State economic ideas come from – no, they do NOT actually come from economics classes or the study of economic data (more on that in my next post).

Take for example the commentary for Proverbs 6. Jesus Christ is presented as the “ultimate self-starter”. Good men save their money “by the conviction of the truth God revealed to them”. “Sluggards and spendthrifts” should be starved. That’s right, people who won’t work or who waste money should be starved.

But the writer really gets going at Proverbs 13. Here’s an excerpt, scriptural references omitted for ease of reading:

Lazy people want stuff. They envy and resent the things of workers. They have many excuses why others have more than they have. They will not put in the work to get things. Instead, they whine about discrimination, luck, favoritism, etc.!

They covet much, but they cannot get their lazy backsides out of bed to get those things. They will not even unfold their arms to put food in their mouths! Work frustrates them, and they cannot figure out simple means of getting ahead. When success falls in their laps, they cannot get it in the bank!

They need a bigger house, but they turn down offered overtime. They want a nicer car, but it is more fun to play basketball than take that side job.

Basketball?!? Why not playing golf or going to NASCAR races? Am I wrong to think there’s a bit of racism here? The writer continues (this time, without even bothering to reference particular scriptures):

A sluggard is a lazy person. A sluggard goes to bed late, uses the snooze button, sleeps in late, is grouchy until noon, complains about his job, dresses sloppily, arrives late, moves slowly, slouches, is often still with hands in pockets or arms folded, would rather talk than work, takes frequent breaks, complains about difficult tasks, stands around unless forced to action, never asks for the next assignment, looks for shortcuts, leaves early, makes fun of hard workers, and is always talking about his last or next vacation.

There are pages of this stuff. Again, the clear, scriptural antidote to this behavior is – you guessed it – starve the bastards! Note that this all assumes that there is indeed work to be had – an assumption that may already be untrue for some groups of workers, and will certainly be untrue for many more in the future.

But notice how this feeds into our current political debates – even as I write this, the GOP has inserted language into their healthcare bill meant to appease conservatives, such as stipulations that the able-bodied must work to qualify, and that the poor receive tax deductions instead of tax credits (to keep from giving anyone a hand-out).

And remember when Tea-Partiers cheered at the hypothetical 30 year old dying because he didn’t have healthcare?

Make no mistake about it – conservative Christians aren’t really worried about deficits, or that healthcare will cost too much, or that taxing the wealthy will hurt job creation. No, not at all. They think that when government takes care of the poor by taxing the rich a bit more that it frustrates the divine will. God has rewarded the rich (contrary to just about everything Jesus ever said) and to take even a small amount from them is to interfere with God’s laws of economics. This is what made President Obama the devil in their eyes – because of course we all know who works to destroy God’s plan – Satan!

The rich of course just don’t want to pay more in taxes – politicians are expensive, don’t you know, and you’ve got to buy a lot of them if you want to keep the working man in his place. Don’t believe it when you hear conservative politicians say, “we’d like to do it – we just can’t as a country afford it”.

The GOP are philosophically opposed to helping the poor, and believe they are doing God’s work. And the gates of hell shall not prevail against them.

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Which Economy is Trump Talking About?

In American Economy, Current events on January 28, 2017 at 4:30 pm

I’ve written about the apparent confusion of the language here in the US between conservatives and liberals, commented on how the word ‘entitled’ has been transformed from a criticism of the upper classes to a pejorative for the working poor, and lamented that some accept lies as facts simply because they have heard them hundreds of times. And now we have Sean Spicer and Kellyanne Conway giving us ‘alternative facts’. But in all of this confusion, there is one idea that is so muddy and unclear that one hardly knows what it means – or whether it means anything at all. In fact, I think we may all have quite a different idea in our heads when we hear the words ‘the economy’.

Studies of bi-lingual children have shown that the same word spoken in different languages can produce very different images in the mind. One study involved French-Canadian children between the ages of 4 and 7 years old who had one English-speaking parent at home and one French-speaking one, and could use both languages with equal skill. The children were given a piece of paper and some crayons and were asked by an instructor, in English, to “draw a dog for me, please.” The children happily complied. The drawings all looked very similar, as do most drawings done by children of this age. No surprises.

The next day, the same children were given the exact same instruction, but this time, the whole event was conducted in French instead of English, so the children were told to “dessinez un chien pour moi, s’il vous plait.” Again, all of the drawings looked very similar to each other – but to the astonishment of the instructors, they all looked decidedly different from the drawings of the previous day. The study was repeated with a variety of different objects and creatures school children might be familiar with – every time with the same surprising result.

It seemed that when the children were communicating in French, they were actually thinking differently than when they were speaking in English. Is it possible that ‘un chien’ produces one image in the mind, while ‘a dog’ conjures another? Can it be that not only do different cultures have different ideas kicking around in their brains, but also different ideals?

Or, that what one person means when he says ‘the economy’ isn’t the meaning I get when I hear him say it? This might explain why we are in so much disagreement about how to fix our ‘economy’.

I’ve never been rich, so I have a decidedly middle-class idea of what a good economy might look like. To me, a good economy means that everyone who wants to work can find a job, and that those jobs pay enough to provide the necessities of life. With a bit of hard work, other opportunities to obtain better jobs with better pay become available, and some of the niceties of life, such as a house or car, can be afforded as well. Over time, not only can one afford a few comforts and modest luxuries, but a modicum of financial security. Professionals and successful entrepreneurs can scale to even greater financial heights, but pretty much everyone can expect to exchange his or her labor for a typical American lifestyle. Government assistance is for those who have temporarily fallen upon hard times or who legitimately can not work.

NAFTA, North American Free Trade AgreementWhat about for those who don’t work for a living, but instead depend on the accumulation of wealth and a positive return on investments? The availability and quality of work is an integral part, in my mind, of a good economy. But, I’m guessing that ‘a good economy’ means something altogether different for investors than it does for me.

Notice that how well Wall Street is doing doesn’t factor into my thinking about the economy, but it would be perhaps the single most important factor for someone with a huge accumulation of wealth. For me, I’d like to do something I enjoy doing, and pay the bills doing it. For a person who doesn’t need to work, doing what he wants to do and paying the bills while doing it is a foregone conclusion; what he wants is something completely different from what I want – and thus his idea of what is ‘good for the economy’ probably doesn’t line up with mine.

He wants a good return on his investment. I want a good return for my labor. He might be able to win some, lose some; I cannot afford to work at something that doesn’t pay.

So, when conservatives tell us that tax cuts for the rich are good for the economy, we need to ask, “Which economy?” When the rich have more cash, they invariably invest more into the stock market. As more money pours in, stock prices rise – whether the companies selling shares perform better or not, more buyers than sellers creates an influx of cash for a finite number of shares, causing  prices to rise. Therefore, tax cuts are good for the stock market and those who invest in it. If this is your measure of ‘a good economy’, then saying that cutting taxes for the rich is good for the economy is true.

However, if your idea of a good economy looks like mine, then tax cuts are counter-productive. Teachers, policeman, firemen, and other government employees get axed when taxes are cut, which sends most communities into a downward spiral. Those who lose their jobs can no longer shop or buy, meaning that local businesses lose income as well, meaning they may have to lay off employees as well. All those folks without jobs means lower tax revenues next year, which necessitates even further job cuts.

Depending on how it’s managed, this can still be good news for shareholders. Those redundant employees might be forced to take lower-paying jobs than they had before, and low wages increase the bottom line for big business.

But notice the big difference – the investor class can do well in either type of ‘good economy’, when companies are expanding and adding employees or when they are cutting costs by letting them go. If he’s savvy, the investor can make even more money when stock prices go down.

The man who depends on his labor for his living is not in the same predicament. When the economy is bad, he suffers. Some may find a way to start a new business in bad times, but most end up making less money than they did before. There’s no upside to a downturn for the working man.

I think this is one of the reasons Donald Trump is now POTUS. While I think the man is abhorrent, there are a great number of people who voted for him because they haven’t seen their personal economies improve in decades, despite watching the stock market double in the last 20 years. I don’t see how cancelling trade agreements like TPP and NAFTA are going to reverse that trend – what I really think is that, while people have had stagnant wages, they’ve enjoyed cheaper prices on goods. ‘Renegotiating’ trade agreements will do little to bring back jobs or raise wages, but will certainly raise prices on everything from computers to shoes to vegetables. So, the working man will lose again.

I certainly do NOT see how more tax cuts for the rich will create those jobs or raise wages – not in the US anyway. And I’m afraid I don’t have much sympathy for what ails the rich, nor am I concerned about what benefits that class without benefiting others. A guy like Mitt Romney pays 15% in taxes on his millions, which grow while he sleeps, while I pay 30% on what I earn by the sweat of my brow. He can adjust his investment strategy to incorporate a downturn; I’m left with the ultimate tax break – I get to pay 0% if I have no income at all.

Can Trump improve the middle-class economy while slashing taxes for the rich? It hasn’t worked in my lifetime – but I’m guessing we’ll know the outcome soon enough.

Which Economy?

In 2012 Election, American Economy, Current events on October 10, 2012 at 12:59 am

English: Stop sign in Quebec Français : Pannea...

I know I’m waxing political the last couple of weeks, and neglecting my sworn duty to blog the entire New Testament this year; it is election season here in the US, after all, and it’s hard to escape the noise of it coming from every direction. I promise I’ll be back to my secular rants about the NT soon.

I’ve written about the apparent confusion of the language here in the US between conservatives and liberals, commented on how the word ‘entitled’ has been transformed from a criticism of the upper classes to a pejorative for the working poor, and lamented that some accept lies as facts simply because they have heard them hundreds of times. But in all of this confusion, there is one idea that is so muddy and unclear that one hardly knows what it means – or whether it means anything at all. In fact, I think we may all have quite a different idea in our heads when we hear the words ‘the economy’.

Studies of bi-lingual children have shown that the same word spoken in different languages can produce very different images in the mind. One study involved French-Canadian children between the ages of 4 and 7 years old who had one English-speaking parent at home and one French-speaking one, and could use both languages with equal skill. The children were given a piece of paper and some crayons and were asked by an instructor, in English, to “draw a dog for me, please.” The children happily complied. The drawings all looked very similar, as do most drawings done by children of this age. No surprises.

The next day, the same children were given the exact same instruction, but this time, the whole event was conducted in French instead of English, so the children were told to “dessinez un chien pour moi, s’il vous plait.” Again, all of the drawings looked very similar to each other – but to the astonishment of the instructors, they all looked decidedly different from the drawings of the previous day. The study was repeated with a variety of different objects and creatures school children might be familiar with – every time with the same surprising result.

It seemed that when the children were communicating in French, they were actually thinking differently than when they were speaking in English. Is it possible that ‘un chien’ produces one image in the mind, while ‘a dog’ conjures another? Can it be that not only do different cultures have different ideas kicking around in their brains, but also different ideals?

Or, that what one person means when he says ‘the economy’ isn’t the meaning I get when I hear him say it? This might explain why we are in so much disagreement about how to fix our ‘economy’.

I’ve never been rich, so I have a decidedly middle-class idea of what a good economy might look like. To me, a good economy means that everyone who wants to work can find a job, and that those jobs pay enough to provide the necessities of life. With a bit of hard work, other opportunities to obtain better jobs with better pay become available, and some of the niceties of life, such as a house or car, can be afforded as well. Over time, not only can one afford a few comforts and modest luxuries, but a modicum of financial security. Professionals and successful entrepreneurs can scale to even greater financial heights, but pretty much everyone can expect to exchange his or her labor for a typical American lifestyle. Government assistance is for those who have temporarily fallen upon hard times or who legitimately can not work.

The availability and quality of work is an integral part, in my mind, of a good economy. But what about for those who don’t work for a living, but instead depend on the accumulation of wealth and a positive return on investments? I’m guessing that ‘a good economy’ means something altogether different for them than it does for me.

Notice that how well Wall Street is doing doesn’t factor into my thinking about the economy, but it would be perhaps the single most important factor for someone with a huge accumulation of wealth. For me, I’d like to do something I enjoy doing, and pay the bills doing it. For a person who doesn’t need to work, doing what he wants to do and paying the bills while doing it is a foregone conclusion; what he wants is something completely different from what I want – and thus his idea of what is ‘good for the economy’ probably doesn’t line up with mine.

He wants a good return on his investment. I want a good return for my labor. He might be able to win some, lose some; I cannot afford to work at something that doesn’t pay.

So, when Mitt Romney and other conservatives tell us that tax cuts for the rich are good for the economy, we need to ask, “Which economy?” When the rich have more cash, they invariably invest more into the stock market. As more money pours in, stock prices rise – whether the companies selling shares perform better or not, more buyers than sellers creates an influx of cash for a finite number of shares, causing  prices to rise. Therefore, tax cuts are good for the stock market and those who invest in it. If this is your measure of ‘a good economy’, then saying that cutting taxes for the rich is good for the economy is true.

However, if your idea of a good economy looks like mine, then tax cuts are counter-productive. Teachers, policeman, firemen, and other government employees get axed when taxes are cut, which sends most communities into a downward spiral. Those who lose their jobs can no longer shop or buy, meaning that local businesses lose income as well, meaning they may have to lay off employees as well. All those folks without jobs means lower tax revenues next year, which necessitates even further job cuts.

Depending on how it’s managed, this can still be good news for shareholders. Those redundant employees might be forced to take lower-paying jobs than they had before, and low wages increase the bottom line for big business.

But notice the big difference – the investor class can do well in either type of ‘good economy’, when companies are expanding and adding employees or when they are cutting costs by letting them go. If he’s savvy, the investor can make even more money when stock prices go down.

The man who depends on his labor for his living is not in the same predicament. When the economy is bad, he suffers. Some may find a way to start a new business in bad times, but most end up making less money than they did before. There’s no upside to a downturn for the working man.

I’m afraid I don’t have much sympathy for what ails the rich, nor am I concerned about what benefits that class without benefiting others. Mitt Romney pays 15% or less on his millions, which grow while he sleeps, while I pay 30% on what I earn by the sweat of my brow. He can adjust his investment strategy to incorporate a downturn; I’m left with the ultimate tax break – I get to pay 0% if I have no income at all.

When you go to the polls in the next few weeks or drop of your ballot before election day, you’ve got to ask yourself  – which economy are you interested in?