Republicans tried to demonize President Obama during the election by calling him a socialist, not good for the economy, wrong for America and a big disappointment.
“The president hasn’t disappointed you because he wanted to,” Mitt Romney said in his acceptance speech at the 2012 Republican National Convention. “The president has disappointed America because he hasn’t led America in the right direction.”
But here’s the reality: the Department of Commerce said last week that corporate profits hit an all-time high in the third quarter of this year, up more than 18% over last year.
In fact, profits have only been going up since President George W. Bush left office and the Congress passed President Obama’s stimulus package.
Here’s the bad news: workers are not benefiting from record profits. In fact, wages have now fallen to a record low of 43.5% of GDP.
Look at the chart. There seems to be some kind of income fairness in this country until about 2000. But then George W. Bush becomes president and corporate profits (in red) go way up, except for a temporary downturn during the recession. But wages (in blue) go steadily and significantly down.
Sam Stein, political reporter for The Huffington Post, says the huge separation between corporate profits and worker wages have weakened Republicans in the “fiscal cliff” budget negotiations.
Republicans “have an optics problem when they are out there saying we need to protect the tax rates of the top 2%, because everyone knows the recent history of income inequality in this country,” Stein told msnbc’s The Ed Show on Monday. And during an exclusive interview on The Ed Show on Tuesday, House Democratic Leader Nancy Pelosi called the disparity “an immorality in the system.” But there is good news. Even though wages are lower, consumers are basically driving the economy. Consumer confidence reached its highest point since February of 2008. And a new report shows the automobile industry continues to roar back. Almost every automaker is reporting big sales gains. Dodge is up for the 32nd month in a row. Chrysler sales are up 14% over last year. And the Hyundai plant in Alabama is running at full capacity and can’t keep pace with demand.
Steve Frank Recommended
