Jerry Miskulin – 3/7/08

This page was last updated on March 8, 2008.

‘Welcome to the new America’; Jerry Miskulin; Beaver County Times; March 7, 2008.

Below is a detailed critique of the subject letter.

“The Fed chairman wants to bring us out of a recession. But what he doesn’t understand is that there’s no money from the middle class on down.”

[RWC] Don’t you have to be in a recession first? “[T]here’s no money from the middle class on down?” Is Mr. Miskulin serious, or does his definition of “middle class” differ from mine?

“You can’t get water from a stone. Years of job outsourcing and income tax cuts have left all the money with the upper classes. We no longer have an economy based on quantity but rather quality. Hence, a rise in prices which further exacerbates the situation.”

[RWC] I believe Mr. Miskulin meant “offshoring,” not “outsourcing.”

Regarding “income tax cuts,” Mr. Miskulin failed to note everyone received rate cuts and “the upper classes” now pay more taxes and a higher percentage of taxes than before the tax rate cuts. IRS data shows the top 5% income earners pay 60% of total federal income taxes while the bottom 50% pay only 3% of total federal income taxes. The average rate for the top 1% is about 23% while the average rate for the bottom 50% is only 3%. According to the Tax Foundation, a source used by the Times, “7.8 million low and middle-income families had their entire income tax liabilities erased by the cuts.” As a result of the tax rate cuts, in 2004 approximately 44 million filers had no income tax liability, and some actually received “refunds” (the earned income tax “credit” is an example) for taxes they didn’t pay.

I have no clue what Mr. Miskulin meant by “an economy based on quantity but rather quality.”

“What we have is a division between have and have-nots. And for the have-nots, it doesn’t pay to have second thoughts when thinking about buying something.”

[RWC] This sounds like the “Two Americas” BS John Edwards tried to peddle in both the 2004 and 2008 presidential campaigns.

“The housing industry was brought to its knees by a populace with high expectations. These people grew up surrounded by wealth and expected nice things, even though they could not afford them.

“They figured that if they took on these large mortgages that somehow things would work out. They felt they deserved nice things because everybody else had them. Their expectations were high.”

[RWC] What BS! A “populace with high expectations” didn’t hurt housing and lending. These industries were hurt by people who took on debt they knew they couldn’t afford and by lenders willing to lend to people whom they knew to be bad risks.

Everyone grows up knowing there will be things they can’t afford.

“But things didn’t work out, and many have had to file for bankruptcy.”

[RWC] That’s what happens when you make poor choices.

“Welcome to the new America. As Bob Dylan would say, “It’s a slow train coming” and “the enemy I see wears a cloak of decency.””

[RWC] Huh?