Thursday, July 31, 2008

Profits Soar and Tax Revnues Sink

I was called a communist at dinner last night. The person who used the word is an investment banker.

I bragged that I am a socialist, and American socialist: I think everyone should have nice things.

My socialism is a cultural socialism. I am not opposed to the free market, and many civilized nations have proven that you can successfully enjoy both a free market and a socially responsible government.

Our government is, of course, socially irresponsible and distributes our tax dollars to privately-held corporations to deliver government services. These corporations' primary responsibility is not to provide the services that a civilized nation requires, but to shareholders who are only interested in increased profits.

If, as Ronald Reagan insisted, our government services could be better and more effectively delivered by private corporations, then the demand of shareholder profits must be addressed after the actual, successful delivery of the social products contracted (roads, transportation, education, security, etc.).

Let's look at education.

We are seeing a drop in the effectiveness of the originally successful charter schools in the Untied States. These schools opened to much fanfare and the corporations contracted to run them spent their budgets building model schools that were wildly successful. There was little profit in this, however, because it costs a lot of money to run a good school.

In order to satisfy shareholder demands for a return on investment, however, these companies began cutting-back on spending and now the wildly successful charter schools are just as mediocre as the public schools they are meant to replace.


Because good education is expensive and private corporations can do no better than public institutions with the budgets we have provided. Simple arithmetic ensures that charter schools will eventually be substandard to public schools because they must factor-in a profit for the shareholders, which is not required in the bottom-line performance of a public institution.

So, charter schools are eventually going to be much worse than public schools.

The privatization of public education is just one of the examples of failure. We could discuss prisons, armies, commuter buses, road repair or any other government service now being contracted to private corporations and the result will be the same: if a profit must be figured into the bottom-line, then there is no way a private corporation can do the work as well, as cheaply, or as effectively as the government agency previously providing the service.

Add to the failure of privatization the conservative movement's success in reducing and eliminating taxes for the wealthiest Americans (those most able to afford to pay taxes). We now have less money to complete more tasks that are contracted out to corporations that must take a slice of our budget as profits. Mathematically, this cannot work.

Of course the rich should be rich and of course they should be allowed to get richer; but, as a society, we must assume responsibility for the social structure and infrastructure that make us a nation.

If the rich are unwilling to carry their fair share of the burden of the cost of society, then the government must take that action for them.

This week, Mobil-Exxon recorded wonderfully amazing profits, record profits, that will make the rich even richer.

The shareholders of Mobil-Exxon will spend those profits to elect government officials who will cut their taxes, privatize social programs, and slash away at our social fabric.

Of course Mobil-Exxon should make huge profits if they can, and those receiving this windfall need to start assuming responsibility for the support of our social and infra- structures.

This conservative movement to use our government as a tool for promoting profits and ignoring social needs is unacceptable. Our Republic can have both a vibrant economy and a vibrant society that are both supported by a democratically elected government.

The conservatives want to keep all the money for a small number of people and dismiss all social responsibility. This is morally repugnant. Huge profits come with huge responsibility.

Come on America, embrace your responsibilities.

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