As
with most things you will find that somebody somewhere has already done what
you want to do. In my speeches on
personal development I often say, “Success leaves clues.” Well, so does failure. If you would like to see how government
theory and policy would pan out if implemented here in the United States all
you have to do is look to the rest of the world for examples of what works,
what doesn’t, and what’s just plain ridiculous.
America is in the depths of a slow moving recovery out of one the
greatest financial calamities in history. The media is inundated with divisive
debate on which direction we should take next and what exactly is the best manner
in which to ensure a full return to normalcy and prosperity.
On
the Right we have Conservatives who advocate cutting taxes on the rich,
lowering corporate tax rates, de-regulating an already dangerously de-regulated
market, repealing Obama-care, and imposing harsh cuts to budgetary programs such
as education, economic development, climate change / scientific innovation, and
public transit / railway initiatives.
The suggested Republican budget reads as if it were written by
people who are actively trying to keep Americans poor, uneducated, and forced
to use gasoline.
Oh wait… it was.
On the left, Liberals want to fund education, police and firefighters, job programs, and high way projects. They intend to extend tax cuts to the middle class and restore the Clinton era tax rates on millionaires, as well as implement a “Buffet Rule” to ensure that the wealthiest 1% no longer pay lower tax rates than the middle class. The president himself has spoken in favor of rapid and light rail projects that will in the short run, put people to work, and in the near future, get people to work.
Well
there you have it Liberals and Conservatives sit in diametric disagreement on how to get America back on her feet. It seems evident from past attempts that lectures on ethics and
common sense do little to dissuade the Conservative mind. I realize some people need the use of visual aids
and examples to understand the not so complex issues here. As stated earlier, both success and failure
leave clues. Other countries have tried various
tactics stemming from both sides of political ideology and policy. By carefully observing the success and
failure of other governments and then correlating their economic condition with
the policy that got them there, we can better create our own plan for here in
America. Think of it as looking at a map
that leads from a policy to a desired outcome.
Ireland
Ireland
so closely follows conservative economic policy you would think that Paul Ryan
has secretly been their dictator for the last decade. The nation was listed by the conservative
think tank Heritage Foundation as a top ten country on its Economic Freedom
Index based on its right wing economic policy.
Irish conservative leaders proclaimed that the country needed to lower
their Corporate Tax Rate to become more competitive (sound familiar) which led
to hundreds of multi-national corporations establishing a headquarters there. The problem with was this tended to benefit
the corporations more so than Ireland, as they used the tax rate to funnel
money through Ireland not into Ireland. This
profit transferring is more in line with money laundering then international
investment. As for “Pro Business” de-regulation,
that didn’t work out so well either. At
the heights of the recession the Irish bailed out their big banks, as in
America. The banks that got them in
trouble faced no discipline for the miss-management that destabilized and
ruined the economy. They then decided it
was time to set in place Austerity measures to curve government spending that benefits
the middle class, suffering high unemployment because of the actions of the very
same banks the government just bailed out (sound familiar). They refuse to raise taxes on the rich or
corporations, in favor of more spending cuts (Sound familiar).
In
case you’re wondering how all of this conservative policy worked out for the
Emerald Isle, Ireland has 14% unemployment, 30% youth unemployment, and 0%
economic growth with a national debt that is 95% of GDP. The same pillars of conservative policy that
failed in Ireland are the very same talking points right wing Politian’s and
pundits advocate here in the U.S.
Tenants
of Conservative Economics
·
Low Corporate Tax
Rates
·
De-Regulated Market
·
Spending Cuts
Sweden
By
American standards Sweden, like all Scandinavian countries, is a very progressive
left leaning. When compared to virtually
any other country, it’s better to live in America, as long as you’re wealthy. If you’re poor the pool of American prosperity
begins to look murky compared to our Scandinavian allies. This is due largely to the expansive welfare
social programs in place in Sweden. Sweden
has a maximum tax rate of 61% nearly twice our 35%. Add to that high sales tax (VAT) especially
on items of vice such as alcohol and tobacco.
So what does all this taxation and social welfare get you? Well for starters superior education, healthcare, social mobility, employment, economic growth and global competitiveness. What’s even more impressive, Sweden is superior to America in all these categories. When the recession struck in 2008, Sweden was sitting on a budget surplus, unlike the massive American deficit that spawned from Bush’s wars and tax cuts. Their economic system as was devastated along with the rest of the western world, but because Sweden had progressive social programs in place already it eased the burden on the unemployed, guaranteeing them income and healthcare. Like the Federal Reserve, the Swedish centralized bank, the Riksbank, also approved a large stimulus package to reinvigorate its distressed economy. But unlike America, rather than waste time with partisan bickering over our own $800 Billion stimulus package, the Riksbank acted much more resolutely and aggressively. The Riksbank added more money to the Swedish financial system then the Fed did to America’s relative to the size of the economies. In just two years after these efforts went into place, Sweden enjoyed a faster growing economy than the United States with 5.5% growth in 2010. Swedish unemployment was 7.4% in 2011 compared to 9% in the U.S., and Swedish National Debt is down to a manageable 45% of GDP. If the comparisons between Ireland and Sweden could offer any guidance in moving forward here in the United States, it would be that Liberal policy unequivocally works best in both restoring financial systems during times of despair and safeguarding economies in times of prosperity.
So what does all this taxation and social welfare get you? Well for starters superior education, healthcare, social mobility, employment, economic growth and global competitiveness. What’s even more impressive, Sweden is superior to America in all these categories. When the recession struck in 2008, Sweden was sitting on a budget surplus, unlike the massive American deficit that spawned from Bush’s wars and tax cuts. Their economic system as was devastated along with the rest of the western world, but because Sweden had progressive social programs in place already it eased the burden on the unemployed, guaranteeing them income and healthcare. Like the Federal Reserve, the Swedish centralized bank, the Riksbank, also approved a large stimulus package to reinvigorate its distressed economy. But unlike America, rather than waste time with partisan bickering over our own $800 Billion stimulus package, the Riksbank acted much more resolutely and aggressively. The Riksbank added more money to the Swedish financial system then the Fed did to America’s relative to the size of the economies. In just two years after these efforts went into place, Sweden enjoyed a faster growing economy than the United States with 5.5% growth in 2010. Swedish unemployment was 7.4% in 2011 compared to 9% in the U.S., and Swedish National Debt is down to a manageable 45% of GDP. If the comparisons between Ireland and Sweden could offer any guidance in moving forward here in the United States, it would be that Liberal policy unequivocally works best in both restoring financial systems during times of despair and safeguarding economies in times of prosperity.
Tenants
of Liberal Economics
·
Quality Education, Healthcare,
Social Programs
·
Regulated Free Market
Capitalism
·
Progressive Taxation for
Gov’t Revenues
