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A Conversation with David Cay Johnston (Part 3 of a 4 Part series) By: Jonathan Bille  |
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 Welcome to part three of a conversation with David Cay Johnston, author of “Free Lunch, How The Wealthiest Americans Enrich Themselves At Government Expense (And Stick You with the Bill). Part one and two of this series are available in the archive of this column. You may want to go back and read those first.
DCJ: “Every politician out there talks about how small business is the backbone of the American economy, and the American dream, yet they are systematically undermining that system. It’s because they’ve bought into this nonsense that they are creating jobs, they’re not! They’re simply concentrating the jobs to one location. And not paying attention to the jobs that are being destroyed elsewhere!
If there’s a need for a new good dry good store in a place, then the market will provide. If the population suddenly grows, someone will say, hay look, in the city of Buffalo the population went up 100,000; we should build some stores and make some money. Or if somebody’s income goes up above the rate of inflation, people have more money to spend – let’s go start a business to capture some of that money.
But you don’t create jobs when things are static, and Buffalo, NY is a really good example of this. Subsidizing $600,000 waterfront apartments? First of all, if you can afford a $600,000 apartment, what do you need a subsidy for? Secondly, how is that beneficial to the community?
‘It’s going to bring higher income people back downtown.’
Well, is that the most efficient and effective way to do it? And do you need that much subsidy to do it? And if you do, is there a better place to get more bang for the buck? And how much better off would people be if we just cut their taxes?
We’ve created a Government that keeps looking at the problems of the rich instead of the problems of the people!
You see this in response to the financial crisis we’re having. What was the Governments response? Was the response to pass a law that says if you have a sub prime mortgage you have the right to go renegotiate some new terms so you can keep your home? Not that you will get it, but that you have that right. Because you can’t negotiate now with many of these people because the mortgage has been sliced and diced and securitized and nobody can negotiate with you – it’s black or white. No the answer was, let’s throw money and cheep credit at the bankers!
This is indicative of what the problem is, and it shows how the Government has been captured by these people.
The reason it has been captured by them is that the campaign finance system mandates this. It’s bipartisan, it’s both parties, it is a Government estranged from the problems of the people because the politicians are spending all their time with the rich and corporations and their representatives, not with you and me.”
What do politicians gain beside the retention of office?
“Look at all the politicians who leave office and get set up in incredible jobs. I site Billy Townsend who was head of the committee overseeing the pharmaceutical industry. He got legislation through that enabled the pharmaceutical industry to get the highest possible prices for drugs, under the new Medicare drug benefit, and then he leaves for a job that reportedly pays two and a half million a year.
These people come to Washington saying their going to do good and they end up doing well (for themselves) by doing bad.”
Aren’t there safeguards in place to prevent this?
“There are no safe guards, just absolute minimalist rules.
Look at what’s going on with John Ashcroft getting a $51 million dollar no bid contract from the Justice department, which he formerly ran! If you go back to the 20s, 40s, 50s, this would have been treated as a major scandal.
And I do blame the public for part of this. People have done well enough that a lot of them say that they don’t care about the Government, and that their not involved – don’t pat attention.
When I was growing up in California in the 1950s and 60s, all the blue-collar families took newspapers and went to the coffee shops or barbers and talked about the Government. They were the watchdogs of their own government. Now people want to know, who’s going to be the American Idol.
(Part 4 Continued Next Week)
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