Bloomberg Headline — US Household Debt Jumps Most Since 2008 Even as Credit-Card Rates Surge https://www.bloomberg.com/news/articles/2022-11-15/us-household-debt-jumps-most-since-2008-even-as-card-rates-surge
Fortune Headline — American Middle Class Losing Wealth https://fortune.com/2022/11/02/american-middle-class-losing-wealth/
Since Ronald Reagan was first elected in 1981 Republican’s have controlled tax policy. Reagans “trickle down” tax cuts started the deterioration of US financial stability as we began 43 consecutive years of National debt growth.
Then in 1995, in the first year of their 12 years of controlling Congress from 1995 to 2007 the Republican Congress pushed through major changes in the way housing sales were taxed. If you worked for a living you got taxed at up to near 40% on your salary, but if you flipped houses, and played your cards right you could pay no tax, or 15% to 20% tax on your gains. Almost immediately cable TV was full of shows about flipping houses to make money, and the price of housing began to rise. Within a decade housing prices were unsustainably high, the market collapsed, foreclosures skyrocketed and we sunk into the Great Recession.
Since we never addressed those tax law changes, and just kept the economy from stagnating by continually dropping interest rates, we set the table for the current housing bubble that is now collapsing, again housing prices surged to unsustainable levels, that are now collapsing, and housing costs are a big compenent in the surge of inflation and pushed more people into living on their credit cards.
This is Republican economics folks. In the last 100 years when they set tax policy debt grows faster than the economy. When Democrats controlled tax policy we reduced our National Debt and grew the economy.
Republicans on the campaign trail these days regularly claim they will build a good economy. History documents they are demonstrating their economic ignorance. In the last 100 years when Republican tax policy controls the increase in the National debt has exceeded GDP growth. In the years Democrats controlled tax policy (1933 to 1980) we paid down the National debt and GDP growth increased an average of nearly 3% per year.
Sure Republican’s know how to feather their own nest, but their expertise is in personally grabbing a bigger slice of the existing pie, not building an economy that grows a bigger pie for everyone. Tax cuts for the very wealthy simply give the richest an ever bigger chunk of the existing pie.