We Did It to Ourselves
"After 34 years with LTV Steel, I was forced to retire because of a disability. Two years later, LTV filed bankruptcy. I lost a third of my pension, and my family lost their health care. Every day of my life, I sit at the kitchen table across from the woman who devoted 36 years of her life to my family, and I can't afford to pay for her health care. What's wrong with America, and what will you do to change it?"
It was the most compelling moment of the Democratic debate at Soldier Field. The speaker was retired steelworker Steve Skvara. He stood on crutches, voice breaking, as he spoke.
There are millions of Steve Skvaras out there, and what they do not know, in their anger and frustration, is that their government did this to them. They are the victims of an ideology that gripped both parties and is destroying the middle-class country they grew up in.
Before World War II, the United State sheltered, nurtured and aided U.S. industry—until, by 1928, we produced 40 percent of the world's manufactures. The companies we created, U.S. Steel and Jones and Laughlin, GM, Chrysler and Ford, Boeing, McDonnell and Lockheed, IBM and GE, were marvels of the modern age.
We were the most self-sufficient nation in history, and American industrial workers the best-paid on earth. The companies they worked for had begun to guarantee lifetime job security, generous pensions for retirees and health insurance for all workers.
Came then the free-trade fanatics with their Faustian bargain. If we just throw open our borders to imports from Europe, Japan, Asia and China, we can buy all our goods cheaper, and we will all be richer. For free trade is a free lunch.
What was wrong with this theory?
Every ton of steel produced by LTV, every Chevy built by GM carried in its price tag the cost of the Social Security, Medicare, and federal and state taxes the company and its employees paid, plus the cost of the company's compliance with civil rights, health and safety, and environmental laws the U.S. government had enacted and, most important for Steve Skvara, the "legacy costs" of the pensions and health insurance the companies had agreed to provide.
Every time any company, foreign or domestic, bought a ton of U.S.-made steel, every time anyone bought a U.S.-built Ford or Chevy, maybe 50 percent of that sticker price went for Social Security, Medicare, defense, cops, teachers, parks—and into the pot from which Steve Skvara's pension and health insurance premiums were being drawn.
The Fortune 500 were the greatest welfare states in history. They were the geese that laid the golden eggs for America's middle class. And the free-traders killed them, because their ideology told them what's best for consumers here and now is best for America.
So foreigners dumped their steel, and we gobbled it up. And their steel mills survived, and ours went under. And they flooded our market with Volkswagens, Hondas and Toyotas, and one by one took down our auto companies, so that the U.S. auto industry, which had 98 percent of the U.S. market in the 1950s, have less than 50 percent today.
Mexico now exports more cars to the United States than we export to the world. Chrysler is on the ropes. Ford lost a record $12 billion last year. GM is losing market share. Toyota is No. 1 in the world because Tokyo set out to make itself No. 1. Anybody think the Japanese care two hoots about Adam Smith or David Ricardo?
As one after another of the big companies go down, they head into bankruptcy court and ask for relief from creditors. What are the largest of the liabilities they shed? "Legacy costs"—the cost of the pension and health insurance of Steve Skvara and his wife.
As we all buy up those TVs and radios and motorcycles and cars and clothes made in Japan and made in China, we kill factories all over America and push America's companies into chapter 11.
"But isn't that the free market?" comes the retort. Should we have to pay more for the goods we buy?
Answer: No and no. Europeans and Asians are skinning us alive. We impose corporate taxes that average 40 percent, state and federal. Europe imposes corporate taxes averaging 24 percent. Advantage Europe.
Europe imposes an average Value Added Tax of 19 percent on all they produce.
But they rebate that VAT tax on exports to the United States and stick a 19 percent VAT equivalent on all imports from America. Without calling it a tariff and a subsidy, it is a tariff and a subsidy.
For decades our trade wimps have put up with this.
What needs to be done is simple. Impose a 20 percent entry fee on all imported goods and services, and use the $500 billion to cut taxes on U.S. producers. Steve Skvara is a casualty of globaism, but maybe we can save the next generation from the same fate.
COPYRIGHT 2007 CREATORS SYNDICATE INC.
66 Responses »
Trackbacks
- Volunteer Voters » Why We Now Have 401(K)s
- dispatches from TJICistan » Blog Archive » populists on trade
- Human Rights Should be Restricted to Human Beings « To See a World in a Grain of Sand
- Eunomia · The Roundup
- companies give front line employees more power usa today
Entries(RSS)
In addition to the above suggested readings for Mr. Buchanan, I would suggest anything by Ludwig von Mises or Murray Rothbard. Ignorance of the Iron Laws of Economics is not a free pass. I think that the majority of posters here are alluding to the fact that the U.S. isn't a 'democracy,' nor a Constitutional Republic, but has transformed over time into a simple oligarchy. The concentration of mercantilist thinking and government coercion goes way back to the days of Alexander Hamilton and his ilk. Pandora's box was flung wide open back in 1913 when the hat trick of destruction was unleashed. The Supreme Court's sellout of America by delcaring an income tax to be constitutional, the creation of the Federal Reserve, and the direct election of State Senators. Our biggest problem is going to be fixing a problem that has been around for generations. People were born, grew up, grew old, retired and died thinking that the current system is 'natural' and anything else would be an attack on the proper 'nature' of things.
Here in the UK I've just discovered "Chronicles", thanks to Yankee Doodle. Most interesting post, and civilized discussion. Many points I agree with, some I don't [naturally].
Just thought I'd commend to you all a highly relevant text: "The Future fo Freedom. Illiberal Democracy at Home and Abroad" by Fareed Zakaria - a thought-provoking analysis of the 'democratic deficit' afflicting the USA and most countries in the so-called 'free world'.
Actually I shouldn't have said the goal is only to get ahead of other nations. Man should ideally work for the betterment of his nation and for the glory of God. He should also put work into culture, especially great churches. I lean towards culture that reveres not just Christianity but also particular ties to one's community and nation, at least in the form of a distinct style, though anything religious about a particular nation would be silly. A man can love his nation without worshiping I think...
"Our biggest problem is going to be fixing a problem that has been around for generations. People were born, grew up, grew old, retired and died thinking that the current system is ‘natural’ and anything else would be an attack on the proper ‘nature’ of things." -James Franz (directly above)
Yes the hat trick of destruction as you put it above was unleashed in 1913 putting the icing on a. hamilton's cake or way of doing life. And yes the supreme court was used to seal the deal just like they continue to do today in calling 'money' = speech. And so the USofA has transformed as you suggest into merely an oligarchy which as you suggest people now 'believe' is natural or nature's way, but it's not. They think it's candy, but it'snot... i.e. snot.
The greatness is in the smallness. Everything in nature starts small at the bottom and grows upward becoming not too big but right sized, like the grass comes from the soil first etc. Yes, nothing happens without the sun and so the processes are all under the sun or metphorically under God. But an oligarchy is top down 'as if' it were the sun or blasphemously/metaphorically God. And so mother Nature's way (including the sun) is bottom Up as are the leaves of grass and their roots, the roots of the grass. And that is why it works and gives the air or oxygen, and is decent enough, and is also innovative as once were american towns. As Goethe put it 'grey are all the theories but green is the tree of life.'
That's what is natural and that is what the oligarchy isn't simply because in reality there's no such animal like it, that isn't larcenous or 'make believe.' The thing is in that scenario from time to time reality catches up to it unless it starts moderating itself and moving toward or closer again to reality. But it also mistakes reality as the enemy per se, instead of merely being the enemy of it as it is.
The oligarcy is want to say for example 'let them eat cake' -or- as a king W might say - 'apres moi le deluge?' - except he's still working on his English.
It's the train they call reality and often it seems like it's moving much too slow but like mother Nature reality moves appropriately enough.
Gentlemen,
Trickle down economics do indeed work well. The catch is that it is a double edged sword. Few conservatives are willing to examine, understand and realize the proper construct of the state (or states) but instead have bought into Randian ideas of consumerism and consumer valuation as a means for determining worth.
In adopting a Randian view (just do it), conservatives (beautiful losers to coin a term dropped on them by a rather fine fellow) have become the radical individualists of this age. They want no restraints on how they do business(or who they do business with) and wish to make it a life without structure other than what is defined by the individual. All this must go forward while still working within the confines of a culture and society that somehow retains a sense of structure. They want the benefits but none of the costs. They want the cheap goods, the profits from their investments but none of the hang-ups involved with the resulting destruction of the culture that brought them forth.
Take a trip around the nation. Everything looks very much the same from town to town unless you happen to get off the main road and find yourself in the 'historic district" of some old mill town. Antique shops are a dead give away that this was once a vibrant mill town now destined for weeds and cracked side walks.
The Old Rust Belt has seen this for sometime but the Textile Belt in the South is especially troubling. What one should understand on that matter is that as industry has left, the individual citizen must move into place to cover a maze of taxes that once came from the departed industry. This means higher water rates, higher sewer rates, higher property taxes, higher sales taxes and so forth......it does trickle down.
As localities lose their means of maintaining, they must turn to the government. No amount of service jobs can produce the culture of self reliance that marked this land. The free traders have hammered out their chains as well as ours.
Deo Vindice,
McCallum
Who is this dope directly above...80% of annual wealth belonging to the republic of the USof A and its people is siphoned off in this system to 1% of the population, you fool. I want your soul and your people's to damn them to hell. Questions? Or are you one of those fake-legends in your own mind - aristocrats... boy. Without even the breeding, which is it - stupid. ? i'll trickle down on you...
All the merits of a public education.
Bravo!!
McCallum
Several of the above posts have referred to "American culture" or pop culture. These are oxymorons. Modern Americans, even beginning with Cromwell's spawn, are (mostly unwitting) devourers of culture. A cultural blackhole so to speak. A heavyweight that pulls in culture and destroys it. Look at how many ordinary Americans and pastors were adamantly opposed to and/or skeptical of both World Wars and how many today wear red, white, and blue or yellow ribbons, and utter nonsense about supporting our troops to defend the latest depredations in Iraq. One family in the news recently lost 2 sons to Iraq and has a third going over there. Cultured people would not do that.
Re: #59
yup public education or if you're pulling rank...private education today with the pubescent mind.
________________________
I've been a big fan of Pat Buchanan since the days of the original "CrossFire" program on CNN in the early 1980's. I don't always agree with him, and on a few issues I strongly disagree. But over the last quarter century, Pat Buchanan has been one of the more independent, truly free-thinking political commentators regularly appearing on what has become known in the USA as the MSM (MainStream Media). It doesn't hurt that Buchanan happens to have one of the most joyful, infectious laughs of anyone on American TV.
As an example of independent thinking, how many nationally-known conservatives in the US were opposed to BOTH of our Wars on Iraq (1991 and 2003-?), from well BEFORE the start of each war! And, this was in the face of nearly unamimous support for these wars from within Buchanan's own Republican Party.
On the subject of tariffs, haven't the major American parties traded places at least a couple of times in our history? Lately, the Republicans have become the doctrinaire free-traders, with the Democrats (plus Pat Buchanan) pushing a return to tariffs. But, wasn't the infamous Smoot-Hawley Act of 1930 established by Republicans? This Act led to recipricol tariff hikes by most European countries, eventually spreading tariff wars around the world and (according to some) becoming one of the primary causes of the Great Depression on the early 1930's, in turn leading to the rise of facism in the mid-1930's - eventually leading to the horrors of WWII.
The real problem with workers and their pensions is the virtual destruction of powerful labor unions in the USA by pro-corporate, union-busting forces at both the federal and (some) state levels. Republicans have long expressed a thinly-veiled hatred of unions, and the longer-term effects of this are starting to be felt. It's been quite some time since any major US corporation has felt the sting of a really determined, industry-wide union action. This is something that would definitely get all parties focused on the pension problem, and maybe even desparate to resolve it, in favor of American workers.
All of you above eggheads need to get a real job.... You're typical of the morass that made Amerikwa today's hogan's goat...Who really wants all the medicare and retirements, vacations, etc ? Put some real honest currency into the system and get the hell out of the way..Would any of you limp wristed fruitflys even try to be 1/3 the man of a Daniel Boone ??? You're Metro WUSSIES !!