heretic2

by Chaz Bufe, compiler/editor of The Heretic’s Handbook of Quotations

Certain economic assertions keep popping up year after year, much in the manner of venereal warts. Here are a few of the most common assertions (in italics at the beginning of sections), along with some of the reasons they’re bogus:

* Stock ownership is so widespread that we all have a stake in the economy, that we all benefit from it. This is belied by the facts: the top 1% own 35% of stocks and mutual funds; the next 9% own 45.8%; and the bottom 90% own 19.2%. Other measures of financial wealth are even worse. The top 10% own 91.1% of business equity and 93.9% of financial securities. The top 1% own 42% of financial wealth; the next 9% own 43%; and the bottom 90% own 15% of total financial wealth.

Distribution of wealth is so lopsided in this country that according to Politifact the Walton (Wal-Mart) family owns more wealth than the bottom 41.5% of American families combined.

* It doesn’t matter if corporations are taxed, because they pass those taxes on to their customers. If this is true, one wonders why corporations so strenuously attempt to shift taxes to individuals. One might also wonder why, if corporations are people, according to a grotesque, still-in-force Supreme Court ruling (Pembina Consolidated Silver Mining Co. v. Pennsylvania – 125 U.S. 181 [1888]), these “people” should be exempt from paying taxes.

And while it is hard to believe, competition still exists in some sectors of the economy, and if corporations are taxed, they can’t automatically pass along the taxes to their customers. They can, to preserve or expand market share, shave their profit margins and executive compensation. Beyond that, not all individuals use all products. For instance, a tax on companies that produce corporate jets will affect corporations that produce and corporations that buy private jets, not the vast bulk of consumers. Further, consumers can choose to avoid passed-on taxes by buying goods from manufacturers who have trimmed their profit margins, by buying used goods, by reducing consumption, or simply by refusing to buy nonessential goods.

* Unemployment is a result of laziness. If this were so, why do unemployment levels vary so drastically over the years, and often change nearly overnight (as in 1929 and 2008)? Is it really the fault of employees’ laziness that employers shut down their businesses and lock their doors? Do employees really prefer losing their health benefits, pensions, and most of their income in favor of limited-time unemployment insurance checks? As anyone who’s ever suffered it knows, unemployment is a miserable, stressful condition, often accompanied by irrational shame. That shame–and endless repetition–is why well-paid corporate lackeys get away with uttering this cruel lie.

* Military spending is good for the economy. The U.S. government’s 2013 military budge is $682 billion, by far the largest military budget in the world. It’s more than the military expenditures of the next ten countries combined. and that $682 billion doesn’t even include veterans’ pensions, veterans’ healthcare costs, or the cost of the interest on military spending-incurred debt.

Somehow this is supposed to be good for the economy. Why isn’t it? Isn’t money flowing into communities with “defense” industries and military bases? Yes, it is. But that money produces nothing to meet human needs (food, housing, medical care, utilities, transportation, etc.). To put this another way, this massive expenditure of taxpayer money pays people and companies that contribute nothing useful to the economy.

In fact, the harm extends beyond this utter waste. Those who perform useful work are not only taxed heavily to pay for military spending, their tax dollars that go to the giant military make-work project devalue the money that’s left in their pockets. Rather than their spending the money taken from them on useful goods and services (which would stimulate demand and employment), the government spends their money nonproductively. That spending results in no additional useful goods or services. The amount of money in circulation remains the same, but there are fewer goods and services than there would be if taxpayers kept their money and spent it on their own needs. Military spending devalues the wages of everyone not on the military-industrial dole.

Military spending is not a boon to the economy. One could just as easily spend the $682 billion military budget on the mass production of ping pong balls and produce the same economic “good.”

Military spending is to the economy as a shot of methedrine is to the body. It produces a temporary feeling of euphoria, but at a high ultimate price.

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