April 4, 2013 Leave a comment
Daring to Dream
Americans used to dream big dreams. When I was growing up President Kennedy announced,
“We stand on the edge of a new frontier” filled with challenges to be grasped and opportunities to be seized. In his acceptance speech after winning the 1960 US presidential election, Kennedy spoke of “the frontier of unknown opportunities and perils, the frontier of unfilled hopes and unfilled dreams.” Beyond the frontier lie “uncharted areas of science and space, unsolved problems of peace and war, unconquered problems of ignorance and prejudice, unanswered questions of poverty and surplus.”
It was inspiring.
And Kennedy’s actions were inspiring too. He didn’t just initiate the space program to go to the moon and back within the decade. He also began an ambitious program to eradicate poverty in America. Food distribution to the poor was increased and food stamps were provided for low-income Americans. Unemployment benefits were expanded.
Comprehensive agricultural programs were implemented to raise farmers’ incomes and provide them with greater security. Increases were made in social security benefits and the minimum wage. And major projects were implemented for hospital construction, library services, family farm assistance and land reclamation.
In 1964 President Johnson gave his “great society” speech, which accelerated measures to eliminate poverty and racial injustice. During his presidency new major spending programs were implemented that addressed education, medical care, urban problems and transportation. Many of these programs were further expanded under the administrations of Presidents Nixon and Ford.
Yes, we used to dream big dreams back then. We actually thought we could make progress in alleviating crushing hardships and providing better opportunities for all. And for a while it worked.
The “golden age” of economic prosperity that had begun under President Eisenhower in the early 1950s continued into the 1970s. It created a growing middle class; rising wages matched increases in productivity. Peoples’ lives were being improved; poverty was on the decline. And then the dream began to fade.
Facing the New Reality
[click here for details]
After 1974 productivity (business profits less expenses) continued to go up while wages basically remained flat. The average wage (adjusted for inflation) is actually less now than it was 4 decades ago. The middle class is shrinking and is more deeply mired in personal debt than ever before.
The US government has also gone massively into debt. The tax cuts implemented by President George W. Bush provided a windfall for large corporations and the top 1% of Americans. But they did little to help out ordinary wage earners. Government revenues are at their lowest level in 50 years, and do not come close to meeting required expenditures.
[click here for details]
During the 8 years of Bush’s presidency the annual federal deficit also expanded at an alarming rate.
[click here for details. Note: This older chart was deliberately chosen so as NOT to include the additional effects of the economic collapse of 2007.]
When the speculative financial bubble on Wall Street collapsed in 2007 it nearly brought down the global economy. Millions of Americans were thrown out of work. Federal, state and local tax revenues declined precipitously, and some cities even went into bankruptcy. Meanwhile the largest corporations still remained profitable, sitting on billions of dollars they are hesitant to reinvest.
When President Obama came into office he attempted an aggressive stimulus program to put America back to work. He was held back by a Congress deeply concerned about the massive federal debt. It limited the amount of money that could be committed to the stimulus package. In the eyes of many the measures enacted were far too small to achieve their intended effect. Billions of dollars in federal stimulus were transferred to the states and municipalities. But records show that this money was almost entirely swallowed up just in keeping current state and municipal workers (teachers, police and firefighters) employed, rather than creating additional jobs.
Today, the US economy is on the rebound but economic growth remains very weak. Millions of Americans remain out of work. New jobs that pay well are hard to find. Studies show that the vast majority of jobs created since the economic meltdown have been for low pay. Many provide only part-time employment. Overall, the poverty rate rose from a low of 11.1% in 1973 to 15.1% in 2010. Americans now tell themselves they can no longer afford to keep their support programs for the needy in place.
Yes, we used to dream big dreams. But not any more. Today most Americans are just trying to hold on to what they have. And with crippling deficits, there is little appetite for another massive federal stimulus program. Many would argue that a large-scale infrastructure program is urgently needed to provide badly needed repairs and upgrades to roads and bridges. But there is little hope of this being enacted.
Instead Congress and the President are both looking at how to cut back public expenditures even further. Critics argue that cuts to social programs hurt poorer Americans the most. What is really needed, they say, is increased tax revenue. Trillions of dollars could be saved through cutting tax loopholes for the wealthy and large corporations alone. But the Republicans have pledged to allow no new taxes. Period.
And so America is looking at how to make do with less – how to put off needed infrastructure repairs; how to reduce social security, Medicare and Medicaid expenditures; how to cut back on food stamp programs and other programs that aid the poor; how to decrease expenditures on education, scientific research, food inspection, environmental protection. And the list goes on.
Is this what it has come to? Is this the direction America really wants to go? Is this the future that we dreamed of?