Can we achieve take-off?
Yesterday we ended at the start of the runway to consequential and transformative change. Before we can take off we need clearance from the tower (read American people). It is now accepted that the GOP will stand in the way of any progress. It's my belief that Biden has made peace with that and he's prepared to take his argument on the road to appeal directly to Republican voters.
The American Rescue Plan is underway and it is vital that the implementaion of this plan does NOT fall victim to the usual corporate predators, who swoop in to happily scoop up public money. Biden did say when unveiling the ARP, it must NOT fall foul as did Trump's Covid Relief bills to corrupt intent and skimming. This has long been the blight of government fiscal releif programs around the world. We in the UK have seen some obscene examples of politicians awarding contracts to new companies that later transpired to be owned by business associates and sometimes even family members. It is critical to have robust oversight. You will recall that Trump specifically removed oversight of his Covid relief bills and we are yet to see the extent of corruption that took place as a result.
So why is infrastructure so important as a policy priority from an economic standpoint? This is where we get to dig into the nuts and bolts of political ideology versus benefit to the American people. I've been really looking forward to immersing you in this, so you can see how you have been the victim of one of the biggest fiscal grifts in history at the hands of the GOP and corporate interests. It really is a case of fiscal date rape and still to this day, many don't see what happened. It is genius and goes to the heart of the term 'Make America Great'. All governments govern by consent, so the critical thing to do is to provide the people with enough societal sedation to keep them passive.
In a modern world, which has become obsessed with consumerism, building roads and bridges is not as sexy as a 60 inch flatscreen TV or the latest mobile device. Putting up new power lines is not as much fun as going to Disney World. Repairing dams is not as attractive as going to the latest fashionable restaurant in town. The secret therefore, is to take their mind off crumbling infrastructure and societal blight, by creating an economy that is consumer driven, where the population's obsession with 'Because I'm worth it', is provided with money they don't have to buy things they don't really need. This is not much help for the poor who can't get credit, but to the middle class, it becomes their drug of choice. The reality is, that eventually the credit bubble bursts, much as it did in 2007. The bottom line is, a consumer driven economy is heaven sent as far as the corporate bottom line in banking, finance, retail and entertainment is concerned.
It doesn't take a rocket scientist to understand that many of these business sectors rely on a low paid workforce, especially as bricks and mortar retailing shift to online fulfilment centres. Even in the restaurant sector, the introduction of 'cloud kitchens' is reducing staffing costs further and further as the market looks to find the most cost effective delivery of its food offerings. Online retailers have changed the retail landscape in the same way Netflix has changed the delivery of visual entertainment. These shifts in business models, have a huge impact on the construct of the workforce and as a result, change the socioeconomic landscape. Previously sound corporate taxation models have been totally disrupted by offshore tax avoidance options open to large corporations.
The GOP has provided the wealthy with decades of expanding profits by doing nothing other than deliver constant tax breaks and deregulation to help them exploit either the environment or employment law. There is this gross false argument made that low taxes means more in your pocket. In reality, low personal taxes make only a marginal difference to the average American, because the government is giving with one hand, with the benefit then being passed back to corporate America in higher health insurance premiums, along with inflated retail and service costs. It really is a total scam. Companies like Amazon have become so used to being given a pass on corporate taxes, it's now outrageous to them to have to consider paying their fair share. Indeed their business models assumes little to no corporate tax liability.
So where am I going with this? The bottom line is, a consumer driven economy is nothing but a shop front for corporate tax avoidance. Large companies pay big accountancy firms huge amounts of money to find ways to avoid paying their fair share. Maybe it's about time the Average American decided if and when to pay tax? It astounds me that the cleaning lady in the average fortune 500 company pays more personal tax as a percentage of her income than the CEO that run the company she cleans for. The average man in the street gets no option to avoid paying tax unless they are part of the black economy. If they get caught, They'll do jail time, while tax avoiding corporate executives, have no such worries. They can pay expensive law firms to keep them out of jail. Tax avoidance is the preserve of those that earn more than enough to pay their fair share. So, we are back full circle to being ruled by the rich who know what's best for the poor.
Infrastructure investment can completely change the economic landscape for the betterment of ALL Americans. If it is done correctly, it can see Republicans exiled to the political wilderness for decades and McConnell know this. The question is, can Biden pull it off?
to be continued.......