NOT LEARNING FROM OUR PAST MAY BECOME VERY EXPENSIVE FOR THE U.S. IN 2011

Both political parties are making some big mistakes in how they are dealing with America´s economic issues.

...The symbols for both US political parties

A question for the ages: "If the human race is at the top of the pyramid of intelligent beings, why do we not learn more from our past mistakes and experiences?"

I remember reading some time ago about someone that had said they could not believe that there could be such a thing as a "real God". The reasoning being that; "What kind of God would allow the most intelligent and capable of all living beings, to have both opposing thumbs and the capacity for figuring out how to travel to the moon, but who could not, or would not always learn the lessons from their previous mistakes and experiences?"

Well, when it come to economics and politics, humans continue to show that we are always very bad at learning the lessons from our past mistakes and that we seem to always be seen repeating them, decade after decade.

It appears that based on what is going on between both of America´s political parties, and with their latest actions, the country could now be on the verge of "ripping the beginnings of America´s economic success out of the jaws of recovery". And it is appearing that it will be done, just as it occurred once before in the mid 1930´s.

Today, the #1 focus of the Republicans is for NOT allowing the Democrats and the president to have economic successes. They are also very open for having the whole country, and the world´s economy, go down the drain just for achieving these ultimate goals. And since the giant corporations and the very wealthy (that are the GOP´s major supporters), could probably ride out that kind of economic storm, the GOP has proven that they really don´t care what happens to the American middle class or the rest of the world economy.

As an example from way back in America´s past, in 1937, instead of those in politics continuing to concentrate on jobs for the then working age American citizens, the focus turned to issues such as the country´s large debt problems and government spending, (as is happening today). And as with today´s administration, the FDR administration had taken their eyes off the ball and they stopped focusing on jobs, and started focusing on relieving the country´s debt and dealing with the nation´s spending.

As soon as that occurred, America´s output in early 1937 (that had just started to increase) began to decline. In addition, unemployment again began increasing and the fragile economy slowed, which eventually prolonged the Great Depression. (Sound kind of familiar?)

During any economic recovery, perception is reality. There has been the proper "perception" that with the recent on-going successes of Wall Street, the slow but monthly increases in jobs in the private sector and the previous slowing of those filing for unemployment, this was the overall basis for believing that, "things are improving out there", and they really were.

Unfortunately, with all the money, efforts and noise from the Republicans and the conservatives on the nation´s large debt problems that were mostly due to their own budget cuts and government spending of the last decade, the focus is now off of the much needed US job creation. And since the new Republican Congress has not introduced one jobs bill since January and they have instead focused on issues such as abortion and other social issues, the economy is beginning to show the negative effect of their "non job-related efforts".

Yes, it´s appearing once again to prove that we humans do not learn from our past mistakes.

As the Nobel Prize winning economist, Paul Krugman recently wrote, "Call it the mistake of 2010: a pivot away from jobs to other concerns whose wrongheadedness has been highlighted by recent economic data. To be sure, things could be worse — and there´s a strong chance that they will, indeed, get worse."

For more proof, just look at what is in the news today from the Republicans:

>>> Income taxes are at their lowest since the 1950´s, but the Republicans still do not want the wealthiest Americans to pay their fair share of taxes. (In fact, the new Republican Budget Plan proposal wants to give the wealthiest Americans over 4 trillion dollars of additional tax cuts over the next ten years.)

>>> The Republicans are falsely complaining about the current high level of corporate taxes, while the current "effective corporate tax rate for major corporations is at 14.7%". That is 4+% less than it was during President Ronald Reagan´s second term. And it is about "½ of what most small US businesses pay today".

>>> The Republicans want to lower the corporate tax rate. But they have not introduced any bills for removing all of the corporate tax loop-holes. These loop-holes have allowed major corporations to not only pay zero in taxes, some corporations continue to receive tax-payer subsidies and IRS return checks for millions of tax-payer dollars due to their "loop-hole gaming of the tax codes".

>>> And the new Republican Congress continues to go after social programs and issues such as Medicare, Medicaid, abortion and government spending instead of working on the creating of US jobs.

Even the Federal Reserve Bank of New York published a blog post last week about the "Mistake of 1937". It also said that in 1937, it was the "premature fiscal and monetary pullback that aborted an ongoing economic recovery had prolonged the Great Depression".

Right now, the GOP politicians in Congress are holding the nation´s debt level increase hostage by demanding that severe budget cuts must be made in programs such as Medicare, Medicaid and Social Security. If the president and the Democrats allow that "Blackmail" to succeed, it will put our seniors at risk and it will increase the dragging down of an already weak economy.

If more efforts were put into creating jobs, especially those jobs that would fix or add to what is needed in the nation´s infrastructure, that would begin to immediately start putting more money back into the economy.

The United States economy is a "consumer economy". People that earn a weekly check are the ones that will spend those checks and put the money immediately back into the US economy. That´s why unemployment insurance payments are listed as the #1 fastest way to jump-start an economy. Those unemployment checks are usually cashed immediately and they quickly add almost twice their value into the US economy.

And guess which political party always works to eliminate or lower unemployment insurance payments at every chance? Yep, you got it, it´s always the Republicans.

The problem with the potential "Mistake of 2011" is that the nation is actually in a worse situation than it was in 1937.

Back then, FDR had a strong Democratic House and a super majority in the Senate which President Obama doesn´t have. In addition, the Republican party of the 1930´s was not nearly as far to the right as they are today. Yes, the GOP in 1937 did seriously hate FDR. But even they, did not want to take the whole nation down in a fight with the president and the Democrats, as does today´s Republican Party.

As the Spanish philosopher George Santayana had written; "Those who do not remember the past are condemned to repeat it." Unfortunately, Santayana´s quote only confirms normal human nature to date. And I see no changes in the near or long-term future, regarding humans learning from their mistakes. Today, both of America´s political parties continue to confirm that fact.

Copyright: G.Ater 2011

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