Saturday, April 30, 2011

A Much Needed Comment on the Causes of Economic Collapse

From a new source to me, a website entitled Too Much-A Commentary on Excess and Equality.  Here's the gist of what it says:

"(Andrew) Mellon, a Pittsburgh financier, began his dozen years atop Treasury in 1921. He rated, at the time, as one of the world’s richest men. One of the most determined, too.  Mellon came to Washington as a man on a mission. That mission: to slash federal income tax rates on his fellow rich — and himself, of course, too. He succeeded. 

In 1921, America’s richest faced a 73 percent tax rate on income over $1 million. By 1925, Mellon had maneuvered that top rate all the way down to 25 percent. 

Andrew Mellon’s 1920s handiwork would eventually pour $72 billion, in today’s dollars, into wealthy pockets and set the table for the wildest speculative bubble Wall Street had ever seen. That bubble would burst into the Great Depression — and impoverish, in the process, tens of millions of Americans."

There is a single cause of the recurrent bubbles and subsequent crashes which have plagued the world since the domination of capitalism:  Too much money in the hands of the rich, which, based on the immutable principle of supply and demand, drives commodities to unsustainable values.  This is not some sort of ideological cant- it is the obvious, inevitable consequence of an economy driven solely by market pressures.  It doesn't suit the rich to have this broadcast any further than possible, so they spend immense sums to delude the populace into ignoring the endless succession of hard lessons it has had concerning this fact.  And they have succeeded.  What's more, only a few years after our last miserable excursion down their road, they are already preparing our next disaster.  This time it takes the form of the Republican congressional economic plan which, in its pandering to the rich and its crushing of everyone else duplicates Mellon's disastrous behavior in virtually all of its key features.

With the press praising this newest gutting of the national wealth as a demonstration of level-headedness and courage, and with the Democratic party collapsing in an endless display of cowardice, I see no hope for Americans in the years ahead.  The Republicans, who were apparently not satisfied with the collapse on their watch in 2008, are now determined to continue their theft until another economic disaster occurs which, like the one in 1929, is colossal enough to motivate the American people to wake up to the endless crime of which they are the  endless victims.

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