The Race to the Bottom

The race to the bottom in this election seems to be in full swing this week.  Neither candidate is talking positively about what their approaches would be to addressing the key needs in the country, nor spending any time explaining why and how their policies would work to be effective in delivering the improvements we need in areas like economic growth, job creation, and deficit reduction.

Both candidates are focused on painting the dark, negative outcomes that could result if their opponent is elected.  The objective seems to be to create a high level of fear about the possible outcomes that would result from the election of the other candidate so that the public is motivated to vote for them instead of their opponent.

The fact that both candidates are resorting to this negative, fear-based messaging is nothing less than a scar on our democracy and the spirit of our country.  It will not likely set the stage for a period of positive change for the country going forward, no matter which candidate wins the election.  Instead of exhibiting statesman-like leadership to minimize the level of divisiveness and build a sense of unity in the country, this will almost certainly deepen the existing divides in our country today.  And it will almost certainly lead to even more dysfunction and deliberate gridlock of any policies by whichever candidate and party wins the election.   

Donald Trump tells his supporters that if Hillary Clinton is elected, they will lose their gun rights … that she will appoint Justices to repeal the Second Amendment.  Then he states in language which would be too easy to misinterpret by a small but radical element of his supporters, “there’s nothing that can be done if she wins, unless the second amendment people do something”. 

The issue is not what he meant, it’s what his lack of care in what he says and how he says it could lead to … how this might be interpreted by a small group of his listeners as an urging to take violent action against Hillary Clinton or other public officials who support her if she should get elected, in order to protect their Second Amendment rights.

For her part, Hillary Clinton speaks about Donald Trump being unfit to serve as Commander in Chief, and “someone like him cannot be given access to our nuclear codes”.  So if he wins, what might a small but radical element of her supporters feel is the only course of action to “save the country”?

This exaggerated rhetoric should be carefully avoided by a President and Presidential candidates. They have to take care with what they say to ensure their comments can’t be misconstrued as endorsing violence against the members of the other party.  This is the too likely outcome of campaign rhetoric that paints the other candidate and the other party as being “evil”, “anti-American” or “destroying of our society and Constitution”.  That language can be misconstrued as justification for “revolution” if one side doesn’t get the outcome they believe is “critical” to our future. 

                                                                                                                                                

Of course, it is a certain outcome of the election that one of the two candidates is going to lose.  What kind of a country are these two “leaders” setting the stage for following the election with such highly negative messaging?  Shouldn’t true national leaders be concerned at least a bit on the national condition for the 4 years after the election, as they are on their own election?  Wouldn’t it make sense to focus messaging about their candidacy based on their visions for America and the policies for making that vision a reality?   Would it not be better for the country’s immediate future to focus the messaging about the vision and policy choices in this election, rather than stoking the fear of negative consequences?   Will the losing candidate and party be willing to encouraging the country to unite to help make the new President a success in leading the whole country?  And if not, what do we have to look forward to for the following 4 years?

Are we as an electorate willing to accept leaders who seem to believe that “the end justifies the means”?  One can only hope that perhaps the electorate will perform better than our leaders.  And that the well-being of the country in general, and specifically the extent to which we can continue striving to be “one nation … indivisible”, which we confirm each time we recite the Pledge of Allegiance, can provide the incentive for more positive messaging for the balance of this campaign. 

If you are a person who shares these concerns, I hope you won’t choose to remain silent, that you might reach out to the candidates you support and suggest that you want the negative messaging to end, and want to hear positive messages about their vision and policies if they want your continued support.

Trying to Figure out Which Candidate Has the Best Economic and Job Growth Policy? How About “None of the Above”?

The most important policy issue in the coming election is slow economic and job growth.  Yet neither political party or campaign has proposed a policy that represents an effective solution. 

It is not the “wage gap” that is the issue … it is the declining incomes in the middle class over two decades. 

•   Consumer spending has the single largest impact on economic growth, driving about 65%-70% of overall economic growth, and that requires growing middle class incomes.

• · Since middle class incomes have not grown for 20 years, we should not be surprised that economic growth has been lower than in other post-recession recovery periods. 

Nor are high taxes the key issue.  We currently have had the lowest tax rates in history since 2003.

• ·   Since the end of WW II, top tax rates have been consistently above 39% until 2003.  These were the years our current economy and national wealth were largely built. We have only a few years of economic growth with tax rates at or below 39%.
• ·   During those 50 years, we have multiple decades of economic growth, even with top tax rates as high as 90% from 1950-1962. 

Those 1950 tax rates enabled us to pay for the interstate highway system, the war debt, the VA bill and other benefits for veterans, and the Marshall Plan for Europe.    

• ·  Where would our economy and quality of life be today without those investments? 
• ·  If tax rates had been cut to stimulate more growth in the 1950’s and we carried that debt forward, we’d have much higher debt and interest service expenses today.

Cutting tax rates is no guarantee of economic growth. 

• ·  From a balanced budget in 1999-2000, we cut taxes in 2003 to the lowest level in the past 50 years, in the “hope” that this would stimulate economic growth to bring in more income to offset the decline in revenues from the tax rate cut. 
• ·  What happened, immediately, was that we created an annual deficit in the “hope” that future growth would pay for the investment.  The growth did not happen, and just 5 years later, we experienced the worst economic decline since the great depression.  

The best and most effective way to help grow overall middle class incomes is by sharing company profits with all employees. 

• ·   Companies should be incentivized to allocate a portion of the record profits they are earning to the employees, who are helping to drive the record profits companies are seeing.         
• ·   This approach would help increase the overall income of middle class employees without adversely impacting the profitability of a company, since it does not raise fixed expenses via higher fixed wages or benefits. 
• ·   Then, if profits are invested in expanding a business into new markets or products, hiring more employees, or supporting profit sharing programs to all employees on a reasonable allocation basis, those profits would see a very low tax rate. 
• ·   But, if profits are used to buy back a company’s stock, where most of the benefits of the 2003 tax cuts went, or to allocate bonuses or salary increases to the executive employees only, then those profits would see a very high tax rate. 

In other words, tax cuts have to be tied to the actions that benefit the economy specifically, in order for them to generate the benefits the economy needs to offset the income reductions.