By Laurence D. Schiller
A few weeks ago, I received a ‘letter’ from Sidney Mathias, former Republican Mayor of Buffalo Grove and failed State Representative, supporting Republican Precinct Committeeman (Vernon Township) Leslie Munger for the State House seat currently held by Carol Sente (D-59). After citing her various business interests, the 2nd paragraph states better than I could the complete fallacy of GOP Frankenomics, a fantasy economic theory created by Ronald Reagan and based on the completely debunked Ayn Rynd. To quote, ‘If elected, she will take no pension while working to create jobs, lower taxes and reform Illinois massive pension debt.” HUH? Can someone please explain how you take a state with a massive pension debt, decrease its income by some 4 billion dollars by letting the income tax expire (plus, presumably pass more tax cuts), and not declare bankruptcy? How does this solve the pension crisis? How does this create jobs? This is so oxymoronic that the man at the top of the ticket, uber rich Bruce Rauner won’t even present a plan, which, we can only suppose, he doesn’t actually have, since it is impossible to pay off debt and cut taxes. He knows it but can’t admit it because to do so would support Governor Quinn’s courageous attempts at pension reform. Yet this has been the mantra of the right wing for over three decades: cut taxes for the wealthy because the are the job creators. Then this stimulates the economy and creates more revenue for the state/fed, and magically we can cover all our debt and expenses. Why, remarkably, Rauner has even stated he would INCREASE spending on schools. Really…? Reminds me of Phillip Henslowe, the owner of the “Rose” theater in Shakespeare in Love who notably stated in every disastrous situation, “Don’t worry, it will all work out.” When asked ‘how?’, his invariable response was, “I don’t know, its a mystery.” That sums up the GOP economic policy to a ‘T’.
There is so much wrong here that it is hard to know where to start. First, I wish I could ask Rauner what he would do if he found his business had massive debt. I’ll bet his response would NOT be to cut his income stream, yet that is EXACTLY what Munger, Rauner, and Dold propose. If you personally had vast debt, would you cut your salary? It makes absolutely no sense and is, to quote George H. W. Bush, ‘voodoo economics’. It is nonsense, pure and simple and even Reagan’s economic advisors told him so. The continuing decline of the Middle Class is directly attributable to the policies of Reagan and his successors. Munger, a graduate of Northwestern’s Kellogg School of Management ought to know better since no professor there taught her such flawed economic theory.Well, the admissions process isn’t perfect.
Second, we have two wonderful Midwest examples of exactly what happens when GOP/Tea Party economics are rigorously applied – Kansas and Wisconsin. In both states, taxes were cut, state revenues dropped precipitously, services, such as school funding were severely slashed, and in just a couple of years, both states have fallen to the bottom of the heap in job creation. Kansas is in such trouble that Republicans will likely lose both the Governorship and a senate seat. Yes, we ARE talking about Kansas, a place where science has been replaced by religious zealotry.
Third, Republicans have developed a truly odd idea of government. Take Rauner’s idea of auctioning off licenses for medical marijuana. As the Sun Times so aptly editorialized, Rauner’s thinking can only seem to comprehend trying to get the cheapest deal as opposed to the quality of the service to be offered. The cheapest bid is rarely the best bid, but it sure can make a guy money. Just ask Rauner, whose companies have been charged and convicted of fraudulent business practices to make money. This is pure Ayn Rynd. Unfettered capitalism is good, government regulation bad, even if that regulation keeps our food, drugs, water, and air pure.
GOP freckenomics fails to take into account 3 things:
First, government is not, and cannot, be run as a business. Government has to provide certain services to its constituents. It is not in the business of making money, but providing services. The essential motive of business is to make money, the cheaper the better. If corners must be cut, services stopped, quality compromised, all that is OK as long as the bottom line is met. The American health care system before ACA is a perfect example as the neediest people were denied coverage, and sick people dropped. Why? Because those folks cut into the bottom line. Perfectly reasonable for an health insurance company but a disaster for those sick or in need. Government, on the other hand, must tax to raise the funds to provide services. It is so typical of the rich like Dold and Rauner that they can’t see government in those terms because THEY HAVE NEVER BEEN IN WANT. Dold should be constantly challenged every time he appears and have it be pointed out that he voted over two dozen times to deny people basic health care. There is no defense to this cruel position. Most of us need the services that government provides, but guys like Rauner and Dold don’t care because they can afford these services on their own. Poll after poll shows overwhelming public support for services such as health care, medicare, and social security, but Dold voted to eliminate or privatize them, and Rauner would end most social services for the needy were he governor with a GOP legislature.
Second, tax cuts have never been job creators because the GOP always cuts the taxes of the rich. It is simply bunk. Just the reverse is true. What creates jobs is consumer demand. Period. If no one wants it, no one will produce it. One of the arguments against raising the minimum wage is that jobs will be lost. Bunk. Do you think McDonald’s will close stores if the minimum wage goes up and more people can afford to patronize their products? Will Walmart suddenly go out of business if they actually have to pay their employees enough to live on instead of having to get food stamps? Of course they won’t and there has never been a study done that actually shows job loss when the minimum wage goes up.
Third, there is no such thing as a ‘free market’. Adam Smith’s free market was based on the idea that producers would simply shift to different products as market demand changed. Demand, and supply, would control price. This was naive to begin with because it costs to change from making straight pins to wagon wheels. Further, with the technicalization of the Industrial Revolution, it is extraordinarily difficult to shift production between very different types of products to meet market demand. In fact, rather than ‘demand’ controlling prices, mega corporations have, in fact, sought to control markets by merger and monopoly (trusts), driving prices up, and often, quality and service down. Consumer demand does create jobs, but price is rarely controlled by demand, but rather by the control of supply (such as gas or diamonds) by corporations to drive prices up. Sorry to oversimplify, but my point is that the GOP continues to, quite frankly, lie to us that government regulations and control over Capitalism is evil and everything will be wonderful if we just let the ‘free market’ work. Well, we saw the result of that in 2008 when Wall Street fried the economy.
As for Leslie Munger, well, I had never heard of her and so looked at her website. It was kind of scary as her wingnut rhetoric practically foamed at the mouth while accusing Rep. Carol Sente of all sorts of sins. Imagine voting for the environment and social services. As Sente says, Munger’s budget ideas would crush social services in this state and destroy, rather than fix, Illinois’ economy. As long as the GOP embraces this sort of freckenomics, we must fight them tooth and nail. They are truly bad people who simply don’t care about the suffering they would so glibly impose on the needy of this state.