Is Sound Economic Policy an Option?

Where to start?  There are so many budget initiatives being proposed in various states that will damage local economies, put jobs at risk, leaving the middle class to foot the bill.  The Center on Budget and Policy Priorities has a comprehensive and introspective analysis of state initiatives being introduced, check it out.

Following the 2008 financial crisis many policy makers throughout the world quickly reverted to Keynesian economic policies in order to jump start devastated economies.  Most developed countries, China included, introduced large stimulus packages in order to jump start growth and delay morbid economic projections.
Germany may be the one exception.  One reason being they were not quite so optimistic that free market prosperity would continue indefinitely, leaving them better prepared economically for the downturn.  Three years later the DOW is riding high and the corporate world is showing record profits in many sectors.  This must mean that we are well on our way to recovery and the puppet's on the right insist we must reduce our federal deficit at what could be a critical time to continue federal spending.  Keynesian theories are quickly thrown out the window after only being carried halfway.  The resurgence of republicans in many states has led to proposed cuts that threaten education, social services and jobs.  Would continued federal stimulus targeted at sustaining programs needed to support state welfare and education help ease the burden of right wing attacks on the average American?  Are we attempting to balance our federal budget on the backs of middle class Americans?  Will the democrats ever show the backbone to stand up for what they know is just, as they did in Wisconsin?  Will they continue to play the right wing game of where to cut the budget rather then stand up for a sound economic policy they know is best?

Herbert Hoover attempted to use balanced budgets and tax cuts to offset the beginning of The Great Depression, where did those policies lead?  A rollback of New Deal policies in 1937 due to opposition  from the Conservative Coalition led to a 13 month setback in economic recovery erasing many gains realized by FDR's New Deal.  Are we reverting to monetarist policies (i.e. Alan Greenspan's policies) prematurely, at the expense of the average American?

The federal earned income tax credit is supplemented in 24 states by similar programs to help working families make ends meet.  Four states are currently introducing legislation to cut their earned income tax credit, or completely end the program in Michigan.  Yes, Michigan, one of the most economically repressed states in our nation wants to completely end their earned income tax credit in a time when working families need these breaks the most.  780,000 low income workers from Michigan qualified for this credit in 2009 for an average credit of $432.  Sources say that "every dollar of the federal earned income tax credit generated $1.67 in economic activity."  Does the state tax credit generate less, is this sound economic policy?

Wisconsin, Kansas and New Jersey are other states with budget proposals that include cuts to the earned income tax credit.  Here is a telling quote from Scott Walker:

"In a recent interview, Walker said he did not consider the change to the earned income tax credit a tax increase because most of the recipients have no state income tax liability and receive a check from the state.

"What you're essentially looking at is people being given money from other taxpayers," he said. "In this case, we're ultimately not raising taxes. It's how much money they get back from other taxpayers. But it's not raising what the tax is."

I wonder if citizens who receive these credits feel they have "no state income tax liability" when they look at the withholdings on their paycheck every other week.  What cant we expect from the man who also proposes to cut $9 million annually from the Homestead Tax Credit which provides tax rebates to homeowner's earning no more than $24,500 annually, many of them elderly.

One of the tools that we American citizens have in this age of information is to share valuable resources with like-minded rational citizens.  William Cronon is a Rhodes Scholar and professor at UW-Madison, his blog can tell us much about right wing tactics being employed in Wisconsin and some of the powerful lobbyists behind the power grabs occurring in many states.  The Nation has a great article on the McCarthyesque tactics being employed by the Wisconsin GOP in their attempt to silence him. Cronon can tell us much about the "American Legislative Exchange Council (ALEC), a corporate-funded group organized almost forty years ago by movement conservatives to influence lawmaking in the states."  They are major players in much of the recent legislation aimed at stripping the rights of average Americans, including the 2010 Arizona anti-immigration law.  The link above to The Center on Budget and Policy Priorities is also a great resource for information.  Beyond unions and blatant attempts to suppress the middle class are underlying themes of the erosion of our democratic process and the suppression of basic freedoms.

The apathy of many voters in midterm elections has enabled the right wing power grab that we are witnessing in many states throughout the nation.  Events in Wisconsin and other states have raised awareness as to the true intention of the GOP and we must continue to watch, to speak out and to stand up for the values we hold dear.  We must not allow ourselves to blindly follow the fast moving mass media who will quickly move to the next hot topic and flood us with enough garbage that basic issues become muddled and forgotten.  We must continue to raise awareness of issues we care for and keep fighting for what we believe in.  We must organize and put some backbone into our Democratic constituents who continue to posture in turf wars that the GOP has dictated.  They are better organized and increasingly radical, we must show that the people are willing to stand up for their rights as they are doing in Wisconsin.