Unity? Patriotism? Who Says?
September 26, 2001
Last Thursday night Bush spoke of a need to support each
other. To tighten our belts, for the upcoming conflict with
organized terrorism. This apparently does not include CEO's
, the extremely wealthy, and Wall Street. Just us little guys.
Some Republicans, the usual suspects like DeLay and Lott,
are wanting to take advantage of the current tension to force
through a capital gains tax cut. Shameful. As a general rule,
I believe capital gains tax cuts can sometimes stimulate a
sluggish economy, but should be used rarely. Definitely not
The street sold off sharply last week in response to the
horrific tragedy of the WTC. This is not surprising, but the
patriotism we were all displaying apparently was not felt
by the short sellers and short-termers pulling whatever money
they could off the table and converting them to cash and short-term
bonds. $1.6 trillion in market value has gone up to money
heaven, but "After all," they seem to say, "Supporting
America is one thing, but we are talking about MONEY here."
One sign of the flight from stocks into short-term debt is
the steeper Treasury yield curve, which tracks the difference
in yields between short-term and long-term securities. Cash
deposits are bulging in our nation's banks. The sellers are
the trusts of the super-wealthy, and institutions. The ordinary
Joe is the only one showing any guts.
Now these turkeys are lobbying hard for a tax break on the
profits they will make in the very near future, as they took
advantage of the grief our nation suffered. Imagine the message
of American resilience if the market had closed UP last Monday.
To heck with the lot of them. Raise taxes on their unpatriotic
profits. If we really are at war, as Bush says, then we should
fine them for war profiteering. I think a 70% tax on any profits
made from last week is entirely appropriate.
Now to CEO's. As I hear these guys speaking about all the
layoffs they are are going to do, and all of our tax money
they need to survive, one thing I don't hear from them
is how they, and top management, are going to suck it up.
The airline industry alone is going to get an $15 billion
bailout package, and they are still going to layoff
100,000+ Americans with families to support. What gives?
The everyday CEO gave himself, through a board vote (other
CEO's sit on these boards), on average a 22% raise this year.
Executive pay jumped 571% between 1990 and 2000. If the minimum
wage, which stood at $3.80 an hour in 1990, had grown at the
same rate as CEO pay over the decade, it would now be $25.50
an hour, instead of $5.15 an hour. Think of the strength our
economy could have, right now, if the little guy would have
had successive purchasing power through minimum wage increases
(what second Bush recession?)
It would show great solidarity if these executives joined
the rest of this country, only make a half-million bucks or
so (a serious sacrifice), using the extra dollars to keep
people employed, until America regains its economic confidence.
We are all in this together. But apparently patriotism only
extends just so far...
Many blessings on those companies that gave millions to the
NY and DC victims, and to rebuilding.