Why do the poor and middle-class have to tighten their belts when the rich caused this financial mess?

Republicans won in 2010 because they talked about fiscal issues.  After decades of hearing the Republican mantra of cut taxes and cut spending, voters bought it again.  It was fiscal this, tighten belts that, budget this, control spending that. 
 
I just don’t understand how people bought it.  Who is controlling the Republican Party?  Corporate special interests, the Chamber of Commerce, and CEOs.  The same people who wiped out our economy because of their own greed.  Voters are so brainwashed by the corporate media that they don’t pay attention that Republicans in the 80s pushed our debt over a trillion dollars, and Republicans in the 2000s eliminated our budget surplus and pushed the debt over 10 trillion dollars.
 
So when a Republican says government needs to tighten its belt, voters say yeah, and ignore the history and hypocrisy in that statement.  When a Republican candidate says we need to cut spending, without saying how, voters say yeah and ignore the fact that we cannot cut our way to greatness.
 
And while Republican politicians are demanding we tighten our belts and eliminate the deficit with spending cuts and tax cuts, corporate executives are licking their chops at the profits they can make now that their Chamber of Commerce funded politicians can fight for their “well-deserved” profits.   While the middle class pays, loses services, and struggles to get by, Republican political funders can plan for how to invest the tax giveaways the Republican politicians want to give them. 

Why do the poor and middle-class have to absorb the largest cuts to their schools, cities and counties, when the economic failures of our society and the causes of this budget deficit reside almost entirely in the actions of the richest and greediest Minnesotans and Americans who took advantage of our society to earn money they did not deserve.  Shouldn’t the group that caused the problem pay more to solve it? 
 
Why do Republican politicians think that a family making $50,000 and a family making $250,000 have the same challenges when it comes to what is cut?  How will a cut in education lead to anything other than less quality?  How will a cut in funding for road construction lead to anything other than more potholes and more costly repairs because of those potholes.  How will another cut in funding of social services lead to anything other than more failure, more crime, more abuse, and more deaths.  How will eliminating a chance at life do anything other than perpetuate generational poverty?
 
When FDR was elected in 1932, he was a hard core capitalist, but he saw the likelihood of class warfare on the horizon and made changes in his plans to work toward solving the causes of the nation’s problems.  FDR is the reason we are not a quasi-socialist state like most European countries.  So what will the Republicans do, push us to sharper class differences and to eventual class conflicts, or head the lessons of history and realize a slogan like “cut taxes-cut spending” can get you elected, but in the end it won’t create results the majority of voters are comfortable with.  Keep in mind that half the families in the state make under $57,000.  They will get almost no benefit from the Republican’s “cut taxes-cut spending” tax giveaway to the rich scheme, but they will feel those cuts much more.

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3 thoughts on “Why do the poor and middle-class have to tighten their belts when the rich caused this financial mess?”

  1. I agree, Steve. Only two weeks after being re-elected, my opponent vocally supported the idea that all Minnesotans should chip in to buy the Vikings a new $800M stadium. She pretends that spending Convention Center money will let state taxpayers off the hook for a taxpayer subsidy averaging $60 per ticket per game for thirty whole years.

    Are Lakeville voters asking what her action has to do with her false promises about cutting spending? Are local papers asking how many teacher’s jobs must be eliminated to pay for the stadium or what will happen to programs for our recently unemployed citizens? Of course not. LA built a stadium without a single taxpayer dollar. Minnesota may do the opposite. Halloween is over and the masks finally came off.

    We must continue to spread our message. Otherwise, no one notices. Have a great Thanksgiving weekend!

  2. Steve,

    Thanks for offering your thoughts. I wrote a commentary for MN Political Roundtable but somehow it never got posted (it is now) about how the ME Generation voted … essentially the message was “I’ve got mine—good luck getting yours.” My conclusion was : WE are being misled by politicians and selected interest groups … WE are so afraid that our taxes may be raised, WE are not looking out for OUR best long-term interest … so although no one is talking about raising 98% of wage-earner’s taxes, WE accept no tax rate changes. WE need to realize that “I’ve got mine” is not good for the country or future generations.
    Misleading by special interest groups worked.
    Nationally, of fifty-three competitive House districts where Rove and his compatriots backed Republicans with “independent” expenditures that exceeded those made on behalf of Democrats—often by more than $1 million per district, according to Public Citizen—the Republicans won fifty-one. Roughly three-quarters of all GOP House gains came in districts where independent expenditures by groups like the Chamber of Commerce and Rove’s American Crossroads gave Republican candidates, some of them virtual unknowns until the outside money flowed in, the advantage. The money is powerful.
    Locally, “Coalition of Minnesota Businesses” mailings warranted a OpEd piece – sadly this OpEd was printed after the election … but if you consider that the Minnesota House Republicans targeted 22 races giving between $20,760 and $32,800 to their candidates … they won 21 races, it obviously works.

    Worse yet, these groups will use issues that are unrelated to their cause to influence voters … if you’re Pro-Choice that will be the focus of the literature if the group thinks that issue will motivate voters to vote against you.

    We should be equally concerned that this leads not only to misinformed voters but also lowers voter turnout.

    The other main concern that we should have is the current trend to not participate in public debates. Mr. Kline did not provide the general public a chance to ask him about Ag subsidies (such as the ones received by his wife), “earmarks” that he supported for military procurements that the Pentagon does not want, what his “replacement” for healthcare reform wound include and what the cost would be, or any other issues.

    This election could provide the opportunity for real dialogue between voters. Today, Chip Cravaack was on NPR’s Talk of the Nation and took three telephone calls. Each caller was from Minnesota and asked questions about “clean water”, “trains” and “healthcare reform” … Mr. Cravaack’s responses were not acceptable to callers … his views did not agree with theirs … yet somehow, if you consider that in the last mid-term election, Jim Oberstar bested Rod Grams 180,670 to 97,683 … but his year, Cravaack garnered 133,490 votes while Oberstar’s dropped off to 129,091 … the fact that so fewer people voted is a concern, but it’s the switch that is so dramatic. WHY ? This is an opportunity for voter-to-voter discussion.

    FYI : NYTimes reports :
    The nation’s workers may be struggling, but American companies just had their best quarter ever.
    American businesses earned profits at an annual rate of $1.659 trillion in the third quarter, according to a Commerce Department report released Tuesday. That is the highest figure recorded since the government began keeping track over 60 years ago, at least in nominal or noninflation-adjusted terms.

    Obviously, the corporations are enjoying the current tax policies and investing corporate monies into “buying” the Congress is not a problem.

  3. Minnesota is in crisis. There are three ways of balancing the state’s budget, one-time resources, spending reductions, and revenue increases. All three of these used reasonably and wisely, in the long term, should bring our state back to fiscal black. Unfortunately, one-time resources and spending reductions are the two options that have been used thus far. I will state right now that I do not have all the answers. I do know that some of the cuts and shifting of funds or delay in payments is causing a cyclical decline in the areas of education, cities and counties, and health and safety. If not stopped, will leave our state in the poorest levels of safety, education, and welfare it has ever seen. I also understand that raising taxes to only save a state from an economic crisis is fool hardy. But there has to be compromise somewhere.

    The State of Minnesota never recovered from the economic decline in 2003. Nearly half of the roughly $13 billion budget surplus in 1997 was given away to one time rebates and permanent tax cuts by 2001. One time rebates do not stimulate the economy long term, do not create jobs, and do not upgrade or advance services. Budget surpluses must be maintained but not at the expense of the taxpayer. So while tax cuts/breaks are a good decision if we are over taxing or fees for services are high, let us make sure that those fee and tax cuts are going to those that need them most and not the top 7% of Minnesota’s population or corporations.

    Recent reports and suggestions by such organizations like MAPE, MASBO, Minnesota Budget Project and others have found other ways of budgeting than delaying payments to schools, cutting GAMC, and once again cutting funding to cities and counties. I believe that if some of these were put into effect, it would save Minnesota administration costs. Something that doesn’t seem to be the first thing cut from the state’s budget.

    In a recent WCCO report by Pat Kessler, the legislative per diem was called into issue. Mr. Kessler’s report said that the average per diem payment per elected official in 2009 was $10,903.00. If we were to take that average number and multiply it times the number of state representatives, 134, and the number of state senators, 67, it would come out to a payment of $2,191,503.00. Now you may be asking yourself, what could 2 million dollars do for a 1.2 billion dollar budget deficit? I think it would show the public that our government is serious about controlling its spending. Cutting all out-state travel would also be a big show to the people of Minnesota, which according to MAPE, would save the state 4.6 million dollars. The state has already decreased out-state travel in its budget but not banned it until the state’s budget is back in the black. I would think this would be the first thing to go. I would also like to know how many of our legislators and government workers continually check out the gas guzzling SUV’s instead of the better mileage sedans. How much would we save in insurance, gas, and maintenance if we were to park the state’s SUV’s indefinitely?

    Other cuts that were recommended and ignored were the number of outsourced contracts that could be cut to the tune of $80 million dollars. Now some state contracts are necessary I understand, but the problem I have with outsourcing state jobs is that you lose some control once the contract is signed. We all know what happened with Blackwater and that is an extreme, but outsourced jobs are not held to the same standards as a government employee. Then there is MAPE’s other suggestion of reviewing and possibly eliminating political patronage jobs and compensation for board appointments for the likes of the Met Council, Department of Administration and Governors staff to an approximate total of $2 million dollars.

    School funding cuts has become a huge problem across our state. Eighty-five percent of schools funding goes towards Because of state cuts to funding, school districts are now relying on referendums that are not getting the vote from the public. Gov. Pawlenty’s promise of no new taxes is a false statement. A report put out by Minnesota 2020 states that of the 854 cities in Minnesota, 677 (79.3 percent) experienced an increase in per capita property taxes from 2002 to 2009, while 560 (65.6 percent) experienced an increase of ten percent or more. The average homestead* property tax among Minnesota cities has increased even more rapidly than per capita taxes. Of Minnesota’s 854 cities, 746 (87.4 percent) saw an increase in the average homestead property tax from 2002 to 2009, while 530 (62.1 percent) experienced an increase of 20 percent or more. This is due to the cuts in education funding and county and city funding. Take a good hard look at your property tax statement, how much of your property taxes is actually going to the city you live in? Or is your money going to pay for schools, and county and state funding? I know that only about 10% of my property taxes are going to my city, I also know that roughly 10% of the business taxes are making it to our city coffers.

    Many good suggestions were made to our legislators and governor last session, ones that included no longer funding non-public schools for text books, counselors and nurses, federal rules do not mandate states to provide funding for non-public schools. Another proposal that has come up more than once is allowing school districts to access cooperative buying power of health insurance programs for teachers and staff (which was vetoed by the governor in 2009), not only should this type of cooperative buying be accessed by school districts, but our law enforcement and fire departments as well. Our legislators and the Department of Education should also look at combining or splitting school districts as another possible cost saving effort. If you look at a school districts funding, up to 85% goes to pay salaries and benefits of staff that provide direct instructional services to students, or to support the students or instructional staff. So cutting funding to K-12 education only cuts the quality of service to the students.

    Small businesses are being targeted more and more by our state. Minnesota’s small businesses make up only 27% of the insured population yet there have been 64 insurance mandates, the highest in the nation according to NFIB, placed against these small businesses. Proof again that Minnesota’s government does not think about the bigger picture. With these higher taxes and over kill of mandates, Minnesota government is stifling, no, killing any opportunity of small business growth in this state.
    Along with small businesses, do not forget the farmers and ranchers of Minnesota. We must do everything in our power to make sure that the family farms stay a constant part of our landscape. Local products mean safer food for all Minnesotans. If there is anyone in the farming community that needs to be cut from tax breaks or shelters, it’s the corporate farms. If you can even call them farms, these corporations are the biggest contributors to pollution and waste in our state.
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    In this day of Homeland Security, Terror Alerts and rising security issues, the cuts or unallotment of LGA to counties and cities only further puts the people of Minnesota at risk. LGA is a portion of taxes you pay here in the state that is returned to the county or city dependent upon the population, special needs, and school districts. Now, yes, many cities or counties may have needed to rethink their budgets and start “living within their means” but when budgets start getting cut, safety, health and education are the first on the chopping block. According to the Minnesota Budget Project, a public defender in Minnesota handles approximately 750 cases a year, this is two times the amount recommended by the American Bar Association, yet 53 public defenders were laid off last year, and more are most like slated for layoffs this year. This means larger case loads and of the families and individual eligible for legal assistance, the 75% already not being assisted will most likely grow. Other issues cities and counties face due to unallotment and their own loss of funding due to the fall in home building, rise in foreclosures, and other losses in fee based revenue, is that the replacement of retiring or promoted firefighters and law enforcement will not be in the budget. Education and training for fire fighters and law enforcement will also be cut. Other safety issues like snow plowing and salting of roads will also be cut. Cities and counties may have and have had to use up one-time fund balance transfers or reserves that may be needed to respond to emergencies or natural disasters.

    Now there is a need to look at raising revenue. Pawlenty’s “no new taxes” stance has hurt this state to a certain extent. And as far as “no new taxes” well as we’ve seen that is not entirely true as we see property taxes rising for some time now. There is also the fact that State fees have risen faster than inflation or population growth, almost 19% between 2003 and 2008. Fees for service, which also includes post secondary education, are another form of regressive “tax”. These fees also do not make up the difference for the nearly 13% loss in tax revenue for the state. The MN legislature has come up with a proposal of creating a fourth tax bracket.

    What I would like to see in the spending cuts, is reduction or cutting of repetitive departments, or paperwork. I have seen a lot of this as a volunteer for the National Guard, and when you have a whole department just to re do the work of another department that supervises the work of a lower but same department, there is redundancy, tax payer waste, and frustration on the part of the consumer. County and city health and human services, justice departments, social services, know their clientele better than any state government agency does because city and county agencies are closer to their clientele and the issues of their region. If any cuts are to be made, it should be at the state level first, because there are already reports out there that show that county and city health and social service agencies have a higher completion/success rate than state agencies do at completing cases.

    So, in a nutshell? Minnesota’s government should start from the top down, not the bottom up when it comes to budget cuts. As far as keeping the legislature, judicial, and governor’s office going, it should be lights and heat only, just like any household budget. As for education, make sure that the cuts being made in school districts start with the school board, the superintendents, and non essentials like them. As far as tax cuts or tax raises, make sure the majority of the tax payers, meaning middle to lower income, are left alone. This section of people is the backbone of Minnesota, and if Minnesota’s government continues on its path, that spine will break.
    There is probably more I could address, but I felt that these were the most important. 2009 was a tough year, 2010 isn’t promising to be any better as far as our government’s progress and partisanship is concerned

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