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This part of the thought process concerning laws evolving from theories takes me back to an interview I saw with the Nobel laureate Milton Friedman many years after his work on supply-side economic theory. When the interviewer, the son of a major pharmaceutical family, asked Friedman about the concept of raising taxes to pay off debt, Friedman dismissed the question by saying taxes were socialist and should be very limited.

When asked how taxes should be used as a function of a country’s operation, Friedman threw up his hands, called the interviewer a socialist and ended the interview.

Friedman’s work was latched onto by the Republican Party and turned into a political position by the unknown Grover Norquist. Norquist is an ultra-conservative think-tank type who found glory, but not much notoriety, by schooling front man Ronald Reagan in the wonders of “trickle down” economic theory such that it got him elected twice. It was also the catalyst to bring the intent of Friedman’s theory into practice.

The prior Carter Administration experienced extreme financial hostility from American banks pulling major strings in the Federal Reserve and Department of Treasury. President Jimmy Carter’s administration was doomed by high inflation and astronomical interest rates that stalled any economic and personal growth.

Then, we got Reagan and his cabal of supply-siders.

After cutting taxes in half for the rich and a little for the “lower” classes, away we went on the great experiment in trickle down. Well, the only things that trickled were profits and financial gain upward for the richest Americans. The working and middle classes saw their earnings and spending power stagnate – at best. Then came the military buildup and Reagan found himself in a fiscal nutcracker that required that he raise taxes; something his administration had to do six times to come close to balanced budget – a major component of supply-side economic theory.

After eight years of this experiment, the country was left holding a $6 trillion bag that Ronnie’s successor, Mr. Voodoo Economics, George H.W. Bush had to deal with.  Bush got himself elected by promising “no new taxes," then found himself adding new taxes to pay off the debt and balance the budget.

At this point, one would expect that some very smart economists would have seen that cutting taxes while spending on a 600-ship Navy might be in conflict. Instead, Bush signed off on the Seawolf class of nuclear submarines (this was after the collapse of the Soviet Union) and continued laying keels for additional super-carrier task forces that included the ostentatious and gratuitous naming of two new carriers:  Ronald Reagan and the George H.W. Bush.

Not bad for loading up on debt …

There’s nothing wrong with people wanting to get rich. Rich people openly admit they want more. That is human nature. I’ve written before about how we evolved as hoarding, thieving organisms in order that our tribes should survive. But those aspects of humanity are ignored in supply-side economics; the hoarders will always hoard at the expense of others.

There can be no “trickle down” because it is against human nature to share the wealth.  Laws and regulations must do this. It may seem like a subtle point, but there is a difference between sharing and charity.

Those societies that do neither usually end up in revolution and insurrection.

We are currently experiencing a political agony that is pulling us in two directions: continued adherence to failed experiments (supply-side) and more progressive era practices (higher taxes for the rich) in place during strong economic growth for everyone including the middle classes.

The outcome of these “experiments” will once again prove or disprove which theory is best suited for the U.S. version of capitalism.

Will the hoarders win and keep funneling money to the upper 1 percent of the richest, or will more egalitarian types shift us toward improving the lives and opportunities for those not so blessed by inherited or earned great fortunes?

I don’t have anything against rich people getting richer. My concerns are for those people who just want to work toward improving their lot and seeing they can enjoy the American dream without breaking the law or the bank.

I wish this “laboratory” wasn’t so messy.

 

Turner is a retired teacher and industrial engineer who lives near Marble Falls. He is an independent columnist, not a staff member, and his views do not necessarily reflect those of The Tribune or its parent company. "The Voter’s Guide to National Salvation" is a newly published e-book from Turner. You can find it at www.barnesandnoble.com/ebooks. He can be reached by e-mail at vtgolf@zeecon.com.