Toxic Combination On The Right: Rick Perry And Paul Ryan

While Michele Bachmann nipped at his heels over his STD problem, it must have been excruciatingly humiliating for faux macho-man Rick Perry to be slapped around by the not very manly GOP Breck Girl, Willard Romney over that pesky Ponzi Scheme boo-boo (AKA- The Third Rail of American Politics). Perry ran to Prince Paul for validation, although Ryan, with political problems of his home back in Wisconsin, refused to use the phrase "Ponzi Scheme," at least for now.

The exact wording aside, Perry and Ryan are certainly on the same page-- ginning up an escalation of class war on behalf of the Koch Brothers and their array of billionaire corporate donors. Perry is hoping to land Wall Street's favorite House Budget Chairman evah as his running mate. Both define "freedom" in terms of the law of the jungle mixed in with a strong dose of crony capitalism and arch-hypocrisy. And last week Robert Reich went into great depth explaining Perry's vision of job creation, a vision he shares with Ryan.

Perry and Romney can duke it out over who created the most jobs, but governors have as much influence over job growth in their states as roosters do over sunrises.

States don’t have their own monetary policies so they can’t lower interest rates to spur job growth. They can’t spur demand through fiscal policies because state budgets are small, and 49 out of 50 are barred by their constitutions from running deficits.

States can cut corporate taxes and regulations, and dole out corporate welfare, in efforts to improve the states’ “business climate.” But studies show these strategies have little or no effect on where companies locate. Location decisions are driven by much larger factors-- where customers are, transportation links, and energy costs.

If governors try hard enough, though, they can create lots of lousy jobs. They can drive out unions, attract low-wage immigrants, and turn a blind eye to businesses that fail to protect worker health and safety.

Rick Perry seems to have done exactly this. While Texas leads the nation in job growth, a majority of Texas’s workforce is paid hourly wages rather than salaries. And the median hourly wage there was $11.20, compared to the national median of $12.50 an hour.

Texas has also been specializing in minimum-wage jobs. From 2007 to 2010, the number of minimum wage workers there rose from 221,000 to 550,000-- that’s an increase of nearly 150 percent. And 9.5 percent of Texas workers earn the minimum wage or below-- compared to about 6 percent for the rest of the nation, according to the Bureau of Labor Statistics. The state also has the highest percentage of workers without health insurance. Texas schools rank 44th in the nation in per-pupil spending.

The Perry model of creating more jobs through low wages seems to be catching on around America.

According to a report out today from the Commerce Department, the median income of U.S. households fell 2.3 percent last year-- to the lowest level in fifteen years (adjusted for inflation). That’s the third straight year of declining household incomes. Part of this is loss of jobs. Part is loss of earnings.  

More and more Americans are retaining their jobs by settling for lower wages and benefits, or going without cost-of-living increases. Or they’ve lost a higher-paying job and have taken one that pays less. Or they’ve joined the great army of contingent workers, self-employed “consultants,” temps, and contract workers-- without healthcare benefits, without pensions, without job security, without decent wages.  

It’s no great feat to create lots of lousy jobs. A few years ago Michele Bachmann remarked that if the minimum wage were repealed “we could potentially virtually wipe out unemployment completely because we would be able to offer jobs at whatever level.”

I keep on hearing conservative economists say Americans have priced themselves out of the global high-tech labor market. That’s baloney. The productivity of American workers continues to soar. The problem is fewer and fewer Americans are sharing the gains. The ratio of corporate profits to wages is the highest it’s been since before the Great Depression.

Besides, how can lower incomes possibly be an answer to America’s economic problem? Lower incomes mean less overall demand for goods and services-- which translates into even fewer jobs and even lower wages.

And when it comes to spreading the Koch-up Texas model around the country... where better than Wisconsin, where Ryan's gubernatorial doppelganger, Scott Walker, is competing in the race to the bottom of the barrel? With the state jobless claims soaring, Wisconsin Republicans are taking a kick back approach towards economic problems, content to work on the politics of fascism instead. Last week, tying Ryan and Walker together again, Wisconsin Democratic Party Chair Mike Tate said that "Walker has done nothing to create jobs in Wisconsin and his Republican Legislature can only be bothered to show up for work one day this month, displaying a shocking indifference to the terrible climate they have created in Wisconsin. I guess now that tax breaks for the super-rich have been made law, Scott Walker and the Republicans can take the month off." Meanwhile the DCCC was working overtime after Ryan's controversial appearance on Fox News Sunday yesterday. Ryan was all about class war and falsely claimed Obama's jobs bill will fail because payroll tax cuts (for working people) don't work. To right-wing fanatics like Ryan, Perry and Walker, only tax cuts for millionaires work-- although they never have before.

Reducing Payroll Taxes on Firms Creates More Jobs Than Tax Cuts for the Wealthy. In January 2010, the non-partisan Congressional Budget Office wrote that reducing payroll taxes for firms was among the policies “that would have the largest effect on output and employment per dollar on budgetary cost in 2010 and 2011. By contrast, policies that would temporarily increase the after-tax income of people with relatively high income, such as an across-the-board reduction in income taxes […] would have a smaller effects because such tax cuts would probably not affect the recipients’ spending significantly.” [Congressional Budget Office, 1/10]

National Federation of Independent Business: Payroll Tax Holiday Can Create Jobs. The National Federation of Independent Business has said that a payroll tax holiday for small businesses would help “struggling businesses reduce costs” and “can reduce unemployment and keep people working during a period of slowed economic growth.” [NFIB, accessed 9/16/11]