In case you haven’t noticed, there’s a huge disconnect between what we hear our elected officials say in their scripted sound bites and the reality of what is happening in and to Main Street America.
While Republican leaders trumpet big business as “job creators” needing even more tax loopholes, and fewer regulations, what’s happening on the ground and in the boardrooms of big business tells a very different story.
As businesses continue to report soaring profits, those profits are no longer being invested in the workers helping to earn those increased profits. The latest employment data released in June by the U.S. Bureau of Labor Statistics reveals a disturbing trend: wages are down for American workers, reflecting an actual reduction in income for the middle-income working class.
With unemployment numbers still unacceptably high, we now have an average of 4.6 job seekers per available job opening in the nation. In some states, there are as many as 10 job seekers per available job. Big business has responded to this glut of job seekers by lowering and stagnating wages. It’s basic supply and demand that has a devastating effect on working Americans whose wages are in decline.
Despite soaring profits, businesses are still shipping jobs overseas, investing in the economies of other nations, and taking advantage of drastically lower labor costs. When House Speaker John Boehner speaks of “job creators,” perhaps he’s thinking of the countries of Panama, Uruguay, Mexico, the Philippines and China, all recipients of new American jobs shipped overseas last year. We’ve been paying businesses to ship jobs, and build plants, overseas for more than a decade, and we’ve dismantled our manufacturing capabilities in the process.
While the economy sputters with a recovery that has not reached beyond Wall Street, big business is holding trillions of dollars of revenue from its overseas operations offshore, lobbying Congress for yet another tax exemption. They’re seeking a tax “holiday” so overseas profits will be given a pass when brought into the country, and they want it to be done with no strings attached — no commitment to workers in this country need be made. It’s another TARP in the making — guarantees of billions of dollars of tax breaks subsidized by the public with nothing gained in return.
What’s happening in the business world is precisely what critics warned would occur with globalization and many one-directional free-trade policies. (Remember Ross Perot’s famous quote that the North American Free Trade Agreement (NAFTA) would create a “giant sucking sound” of jobs going to cheaper labor markets south of the border?)
Globalization, and job-killing tax policies, have indeed created a different attitude toward American workers in the eyes of big business CEOs. American workers are now seen all too often as expensive cost centers instead of valued resources that help a business succeed, innovate and prosper.
What the public gets in return today is cheap products, high unemployment, stagnating or declining wages, and a growing income equality gap that now rivals that of many developing nations. Only Chile, Mexico, and Turkey have higher income inequality than the U.S., according to a report released this year by the Organisation for Economic Cooperation and Development, an international group that has collected income and economic data for half a century.
The lack of investment in workers, and the declining share of corporate profits that are returned to workers in the form of higher wages, is in stark contrast to the business model of the past.
Advocating even larger tax loopholes, credits and “tax holidays” for big business as a way of promoting job creation is a cynical attempt to manipulate the public’s fears into accepting yet another round of tax giveaways to high-powered friends with overflowing wallets filled with campaign cash. It does nothing for the deficit, or the national debt, and, as we’ve witnessed since the economic implosion of 2008, it doesn’t create American jobs.
Sometimes what big business wants and what the nation needs aren’t in synch, something Boehner and other Republican leaders aren’t yet ready to acknowledge.