Class Warfare Blog

November 30, 2010

The Big “Narrative”

Filed under: Economics,Politics — Steve Ruis @ 9:45 am
Tags: , , ,

Apparently the hottest buzzword in our nation’s capitol is “narrative.” Basically what is being referred to is a story, actually a storyline, that is being used to shape people’s perceptions of our common discourse. One popular “narrative” is that businesses aren’t hiring because there is great uncertainty over what will happen to their taxes. Well, now we get to see if this “narrative,” like so many of the others, is just a lie in sheep’s clothing.

Now that the Republicans are in charge of the House of Representatives, the chances of a corporate tax increase anytime soon can be lodged in between slim and none. Already Republicans have been beating the drum that U.S. corporate taxes are some of the highest in the world (now that’s a lie that can’t be disguised as a “narrative”). So, this uncertainty “narrative” is no longer “operative” and we should soon see a wave of hiring done by Corporate America. Or not. I suspect “or not.”

If you haven’t been paying attention, reports of just a while ago were that American corporations were sitting on 2.5 trillion dollars of cash. So, they can’t blame not hiring people on not having the wherewithal to do so. And it has most recently been announced that third quarter 2010 profits for U.S. corporations are the highest ever measured! Right on the heels of what has been labeled the “Great Recession,” American corporations are making record profits? How is this possible?

The answer is quite simple. The markets for the goods of these companies are not robust, so their “sales” are down, but their costs of doing business are much farther down. By laying off so many people, and having the fear of losing one’s job to flog the employees remaining, American workers have increased productivity yet again. Also, if you haven’t noticed, the productivity of American workers is the highest in the world, but we haven’t benefited much at all from any of the huge productivity gains of the last 30 years. Well, where is that money going, if it is not being shared with the workers who are creating it? It is going straight into the pockets of the wealthy interests in this country who are spending record amounts of money buying politicians to make sure the current system stays this way.

They are not satisfied, these worshipers at the alter of Profit, not by a long shot. Their Republican puppets are pressing for lower taxes for the rich, lower taxes for the corporations, and fewer services to the poor and middle class to pay for them.

Watch, you will see all of this unfold in the next six months: corporations still not hiring, Republicans clamoring for tax relief for big businesses and for rich people.

And don’t be fooled by the “Repeal the Bush Tax Cuts Campaign” for those making over $250,000 per year. Only 3% of small business owners make over $250,000 per year. This tiny fraction of the “small businesses” (an almost complete misnomer) contains the lawyers, the S Corporations, and hedge fund managers who are behind the money spent to ensure Republicans got back in control of the federal purse. And think about it, if you made $260,000, you would have to pay $3950 instead of $3500 on that extra $10,000, an increase of $450 per $10,000 of income beyond the $250,000 level. Just for whom do you think this would have a deleterious effect? Hmm? Only on someone making way more than $250,000, lots more. We are not talking about “small” business meaning small earnings for the owners. We are talking about business with “small” numbers of owners. We are talking about oligarchs.

 

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