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News & ArtsMonday, March 4, 2013
Politics Why Republicans Love the Sequestration
Posted by Dominic Holden on Mon, Mar 4, 2013 at 8:16 AM
The $85 billion in automatic federal spending cuts that began last week will make a superficial scratch in corporate profits (only about 1 percent), the New York Times reports this morning, but the cuts are expected to cost about 700,000 American jobs. This is good news for Republicans. The so-called sequestration more or less just keeps the United States on the same path we've been on—the path of the GOP's agenda. It's a path that lifted the stock market near record highs last week, and now the country's largest corporations, despite a recession that devastated workers and persists in the form of high unemployment, are scooping up their largest profits in decades:
As a percentage of national income, corporate profits stood at 14.2 percent in the third quarter of 2012, the largest share at any time since 1950, while the portion of income that went to employees was 61.7 percent, near its lowest point since 1966. In recent years, the shift has accelerated during the slow recovery that followed the financial crisis and ensuing recession of 2008 and 2009, said Dean Maki, chief United States economist at Barclays.
Corporate earnings have risen at an annualized rate of 20.1 percent since the end of 2008, he said, but disposable income inched ahead by 1.4 percent annually over the same period, after adjusting for inflation.
“There hasn’t been a period in the last 50 years where these trends have been so pronounced,” Mr. Maki said.
The GOP needs the sequestration. Republicans can no longer mobilize their base by opposing gay marriage, by thwarting attempts to protect women, or by using immigrants as their whipping boy—at least, not like they used to with a national audience—so the party is ostensibly united around fiscal austerity. But that's not what this is about. In the hearts of their leaders, theirs is the party of corporate profits and neutering the power of workers, particularly the poorest workers, and now they hatch two birds with one egg. And all they had to do is do what they do best: nothing.
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Unfortunately for Obama, I don't think he and his advisers understand the plan, or they are a part of it for "the good of the country."
No one seemed particularly alarmed about the entirely stupid and boneheaded idea of sequestration. And look at number 1 up there...still the simple fool falling for the capitalist spin. Poor dear.
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"some men just want to see the world burn".
if he wanted the GOP to do something, anything, he should have made ALL the sequestration cuts to the DoD.
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Keep the proles anxious, hungry, sick, poor, and terrified, and they won't have the will to resist.
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Yeah, I know it sounds conspiratorial, but given the current political climate in Washington, the need for politicians to hang on to their jobs, and the disconnect between the Congress and the American people (or even just their own constituency), it makes sense if this were a backdoor deal.
Think about it this way: If you made, say, $2000 a month and your rent and utilities were $2300 a month and you happened to be behind in rent and utilities. Would you enter into a deal whereby your landlord and bill collectors said, "If you don't get up to date in three months, we're going to start taking some of your things. And if you don't get up-to-date in six months, we'll take away more things, and on and on until you are up-to-date. And oh, by the way, you don't get to choose the things we'll take away."?
Would you enter into a deal like that? Well, the House said OK to it. And the President, under pressure, signed the bill. Now they are saying, "We never thought it'd come to this. We did this sequestration thing to inspire us to balance the budget." All the while everyone knew that the two sides would never come together.
So maybe - if I can be optimistic - this will inspire people to get out and vote for the right people if the populace can determine who is to blame. For me, it's pretty easy to see where the faults lie. Too bad, though, that this is going to hurt the wrong people. No one in Congress is going to be immediately furloughed. No one in Congress is going to lose a paycheck.
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Dominic. When will you learn that the words "Corporation" and "Profit" are not bad words?
Just like "Liberal" and "Green" are not inherently good words.
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BTW, executive comp is robust - while increasingly untethered to corporate profits - but dividends on common stocks (I'm pretty sure you don't really mean "stock dividends") are not robust - and neither are they a good measure of return on invested capital.
And the idea that the sequester is a fiendishly clever scheme serving the moneyed interests, rather than simply a desperate gamble by a congressional GOP that has stumbled into desperate straits? Zebras to zinnias.
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how soon we forget.
even you probably know that the GOP passed multiple hikes to it during Bush the Lesser's reign with nary a quibble.
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