On Democracy Now today, Richard Wolff boiled down what has been happening to our economy by the wealthy and corporations.
Basically, the corporations have low to no taxes and are laying off, increasing profits and hoarding that cash. Then they invest in the US Treasury bonds.
So if I understand this correctly, They are lending money to the US for the deficits that are caused by the economic crisis. They collect interest on the debt that they have caused. And then they complain about the amount of our debt. And expect the US lower economic classes to pay the balance. You know the ones they just laid off. Chutzpah......
So that maybe why they are so slow to react to default. They will make more by the increased interest rates. Unbelievable.
RICHARD WOLFF: Well, even more interesting, and maybe a bit of a shock to folks who don’t follow this, what the corporations are doing when they hold back the money—because it’s not profitable for them to hire—in large part, is they lend it to the United States government to fund these deficits. The United States government refuses to tax corporations and the rich. It then runs a deficit. It spends more than it takes in, because it’s not taxing them. And here comes the punchline. It then turns around to the people it didn’t tax—corporations and the rich—and borrows the money from them, paying them interest and paying them back. If the United States wanted to stimulate our economy in an effective way—
AMY GOODMAN: Pay even tax-deductible interest.
RICHARD WOLFF: Right, also. But if the government really wanted to do something, go get the money from them, stimulate, which will help them, and if you tax them to do it, you wouldn’t have a national debt. You wouldn’t run a deficit. We’re running a deficit because the people who run this society would like us to deal with our economic problems, not by taxing those who have it, the way we used to, but instead by endlessly borrowing them. And now the ultimate irony, we’ve borrowed so much as a nation from the rich and the corporations, they now are not so sure they want to continue to lend to us, because we’re so deeply in debt. And they want us instead to go stick it to poor people and sick people instead. It’s an extraordinary moment in our history as a nation.