During these primaries the exchange has been more about the economy than the war. The bleak picture the Democratic candidates paint is echoed by many of the Democratic faithful who feel for those affected by job loss and outsourcing. To the Republican faithful, however, this scenario flies in the face of a stock market rebounding that is attributed to the tax cuts. Most Republicans voters are of the unscathed middle class and higher and don’t care about factory-shut downs or the exodus of jobs that are not a part of their lives and know that the outsourcing means greater value to their stocks. George W is not just a commander-in-chief, he is an easy-going bank teller.
After all, capitalism has to be in favor of crudely cutting labor costs, which in these days of euphemism, is known as increasing the productivity level, and no longer by automation, but rather back to the era of child and slave labor. Who cares that the California supermarket union has been out on strike four months, trying ironically to cling to its middle class status with decent fringe benefits. The usual Republican reaction is that the union is recalcitrant, unrealistic and up against a brick wall that on the other side lurks the Wal-Mart supercenters which boast 20% higher “productivity” level owing to non-union workers, and thus adds to the already comfortable purchasing power to mainstream America. So why worry? Bush is in control, and the unemployed is but a small minority of registered voters.
Why this euphoria among those who think they do not have to worry about job security and depletion of purchasing power? They see, thanks to tax cuts, higher take home pay; they can buy more luxurious automobiles because of the historically low interest rates; why, some of the wealthiest can buy a Lexus on time without interest. Their homes have increased in value and consequently they take out equity loans or new mortgages at lower interest rates so they can indulge in even greater consumption, or perhaps the wiser ones enroll their kids in private schools or stash it away for future college expense. This optimism reflects the DotCom period before the bubble burst.
Nevertheless, much of this good feeling and spiraling consumption is at the expense of huge national deficits and debt, along with a historic trade deficit. The massive home-building under way is owing to many of the middle class selling their modest homes and buying bigger and better domiciles at sky-high prices — not to mention higher real estate taxes — wiping out the equity and capital gains from the original. Low interest rates or not, they are stuck with a 15 or 30 year mortgage beginning from scratch with little equity unless they took the profits and increased the down payment. Very few would do this because a bigger home requires further furnishings.
Moreover, people of the deluded class have a tendency to overlook the hidden expenses of consumption tax, high interest on credit cards, equity loans and new mortgages triggering the tax assessor; nor are they conscious of their take home pay from their secure jobs is actually shrinking because they are required to share in the increasing costs of health care and co-payments. Most of these people are predominantly white collar, but no one has told the computer programmer making $60 an hour that in India the same position is $6 an hour. In this wireless era, the Wall Street broker might have to carry a picket sign in the near future. And, by the way, a war is going on.
Copyright © 2004 Richard R. Kennedy All rights reserved. Revised: February 28, 2004.