Professor Jacob Hacker Gives Wall Street Shill Ed Royce A Little Lesson In Economics

Not many DC pundits are following the campaign in California's suburban 39th congressional district (Hacienda Heights, Buena Park, La Habra, Rowland Heights, Diamond Bar, Chino, Yorba Linda, Fullerton. Brea and Placentia). It's a swing district where McCain edged Obama 49-47% under the new boundaries. Ed Royce didn't represent much of it, although he's being called the incumbent. And the challenger is Jay Chen, a local school board president and committed smart progressive. This summer he was endorsed by Blue America.

Royce is basically known for two things: his devotion to his Wall Street paymasters and his fervent, divisive racism and bigotry. Here's a new sign Royce or one of his supporters has put up around the district:

This is what Jay said when he saw it:

Yes, we were as confused as you when we first saw this sign in La Habra Heights yesterday. Only U.S. citizens can run for public office, so what are these folks getting at? Are they taking a jab at my birthplace city, Kalamazoo? I know it's a funny sounding name, but it's no worse than Honolulu, and it's not like anyone ever gets worked up about people being born in that city.

  Change can be hard to come by for many people, and it can illicit the worst kind of fears and reactions. In the last two weeks I've been accused of being a "Commie," of wanting to get rid of 401(k)s, and of wanting to tax your wheelchairs. Our yard signs have disappeared in record numbers. It's not pleasant, but this viciousness confirms my opponent's vulnerability, and validates my decision to run.

There couldn't be two more different candidates anywhere than Jay Chen and Ed Royce. Royce is one of Congress' leading proponents of the Austerity Agenda (the new way of talking about Voodoo Economics and Trickle Down) that is failing so miserably in Greece, Spain, Ireland, Portugal and across Europe and Jay has embraced policies for economic growth which have been talked about as "Prosperity Economics." Royce has been on the attack, distorting Jay's proposals and the whole package of proposals put forth by Jacob Hacker and Nate Loewentheil, claiming, for example, that the intent is to "do away with tax deductions for 401ks and force worker and employers to contribute to government-run 401ks." That's a flat out lie, as Jacob Hacker pointed out himself:

Congressman Royce is criticizing a made-up proposal that bears no resemblance to the framework for retirement security that we outline in Prosperity Economics. We do not say tax breaks for 401ks should be ended, and we certainly do not argue that workers and employers should be asked to contribute to “government-run 401ks.”

  This isn’t about government taking over anything. For half of workers, there’s nothing to take over because they don’t have a retirement plan. If we can work with the private sector to fill that huge void, that would be terrific. But if the market fails to solve this problem, the answer can’t be “tough luck.” Every American should have a secure and adequate retirement. They certainly do not today. Prosperity Economics is about ensuring that working families get more, not less.

  Where employers are offering a retirement plan of some kind now, we need to ask them to do better. Where they are not, we need to provide vehicles for private retirement savings that provide some security against market risks. As we argue in Prosperity Economics, we can do this through three steps. First, for the half of workers at private companies who have no opportunity for tax favored retirement savings on the job, we need to guarantee them a chance to save. Second, for the tens of millions of middle- and low-income people who now get little or no savings incentives under federal law, we need to give them the same sorts of tax breaks that upper income Americans get. Finally, to deal with how little is being put away for retirement, we need to insist upon shared responsibility, with employers and workers contributing, along with federal tax incentives.

Instead of demonizing constructive discussion of a problem that most Americans rightly see as dire, our leaders need to focus on making private retirement plans work for working families, because they surely are not working for far too many people today.

You can find all 16 of the candidates Blue America has identified who have been campaigning to protect Americans from the toxic Austerity Agenda Wall Street shills like Royce are trying to mandate in this country. This is what Jay told us about it after he had read Hacker's and Loewentheil's work:

Prosperity Economics brings us back to the principles that make our country great. These ideas, such as investing in infrastructure, education, and our social safety nets, and limiting the power of corporations to distort our political system, are not new or radical, they are part of the original formula that drove the unparalleled success our nation has enjoyed until recently.

But these ideas are now under constant attack, as is the prosperity of our nation, by corporate interests who continue to push a "trickle-down" theory that is already a proven failure. These special interests have made it a point to confuse wealth accumulation with job creation, and the result is a drastic increase in income inequality unseen in modern times.

In the meantime, our middle class, which is the true engine of economic growth and stability, continues to shrink. We simply cannot cut our way to prosperity anymore than we can drill our way out of oil dependence. We need leaders who understand how smart, sound investment made us the great nation we are today, and how prosperity economics can ensure our leadership in the world for generations to come.

Who would call these ideas "Communistic?" The same kind of dangerous right-wing fanatics and John Birchers like Ed Royce who called President Eisenhower a Communist when he made similar proposals at a time when government was working proactively to help build a solid American middle class. Below is the latest attack piece Royce sent out against Jay. Please consider contributing to Jay's campaign so he can fight back against these right-wing distortions and lies.