POTUS Election 2008: Hillary Clinton on Strengthening The Middle Class – Part 2

POTUS Election 2008
Examining The Issues
This is a special series written by the staff of The Conservative Reader. We will examine each of the candidates’ positions on issues they have deemed relevant enough to post on their web sites.

Today we will examine Clinton’s plan of action for American workers. If you have not read Part 1, we suggest you do so.

This week, the Chicago Sun-Times published a story regarding a recent study by the Pew Research Center.  Part of the analysis of the research concluded:

… the majority of the middle class feel they either haven’t moved forward or have fallen backward in their lives in the last five years — the worst showing of short-term personal progress in nearly 50 years…

Then later in the article:

On the upside, nearly two-thirds say they have exceeded their parents’ standard of living.

The article goes on the cover the change in median income and reflects (without quite seeming to get it) on facts that demonstrate that the economy was perhaps running too hard for a number of years, driving people’s expectations, requirements for contentment, and debt-to-income ratio to unrealistically high levels.  We are somewhat convinced here that many people who are dissatisfied about their financial situation are where they are due to overextending themselves on credit and unnecessary capital expenses… again, fueling the economy, but perhaps harder than was appropriate.

Statistics

Before we move on to Hillary’s solutions, one thing I think is worth pointing out.  We have not seen a good statistical analysis of middle class income data (if you have, please let me know!).  The only information we have seen thus far is graphs of the median, which is nothing more than the data point in the middle of all the data… if you had data points of 5, 7, 12, 14 and 14, the median would be 12, the mean would be 10.4 (this is the common definition of “average”), and the mode would be 14.  It would be significantly more valuable to see the mean and the standard deviation, which would give us a better sense of where most people’s incomes really are.  There may be a much different story to tell if we could see more meaningful information.

This is where Hillary starts explaining her plans for Rebuilding The Road To The Middle Class.

Hillary’s Solutions

First point: “Harness the power of innovation to create high wage jobs of the 21st Century“. By itself, this line sounds great but says nothing concrete. “Innovation” is the key word here, and is a vague term that speaks to the hope that someone will come up with an idea.

Hillary details this item out by calling out alternative energy and broadband (presumably she means easy access to the Internet). She also identifies creative partnerships to help re-energize the manufacturing base and new technologies and life-saving medicines. Then she states that she would reverse the current administrative bans on embryonic stem-cell research and cloning (although only vaguely… she does not mention them by name).

Finally she goes on to detail out a plan to build a Strategic Energy Fund to finance an energy research agency.

Most of this section seems to rely upon the hope that some yet-to-be-identified people will come up with ideas, discover solutions, or create new synergies to somehow solve our ills… as if none of this were already happening. As best as we can tell, this is not much more than pie-in-the-sky and creates an opportunity to spend money, without solving anything. Interestingly enough, the idea of achieving “new technologies” and “life-saving medicines” are for the sake of creating jobs, rather than fulfilling any specific need. It seems rather wasteful to create new “life-saving medicines” if they aren’t really needed.  It makes more sense to allow the real needs to drive the innovations.

Furthermore, the idea that broadband Internet access provided to more communities is going to somehow create opportunities for people where these services are not as robust makes sense only if you believe everyone can make money from home using the Internet.  The last time I checked, that was a bunch of smoke and mirrors.  It’s true that one can make money on the Internet, but it takes more than just internet access to make money.  If it were that easy, everyone would be successful at it, but they’re not.  “Work From Home”, “Earn Money On Your Computer”… the business model for many of these ventures is to 1) Get a computer and Internet Access 2) Open a Paypal Account 3) Send out emails to thousands of people inviting them to “Work From Home” 4) Charge them for these very instructions.  Now, Hillary wants to con us with the same scam.

Although financing alternative energy research is already a mainstay of federal spending, we agree this is an area that can tolerate some growth. However, the best way to spend this kind of money at this time appears to be with tax incentives. And providing the incentives to more than just oil companies, but any engineering or related energy company should have a crack at this. Within the boundaries of demonstrating a legitimate effort to achieve realistic results.

The recommended research agency seems like a typical government ploy to create a new kingdom. And subsidizing alternative energy solutions should be done carefully… if done to cover the market challenges of more costly solutions like E85, one will wonder if we’ve actually succeeded since the money to subsidize the solutions has to come from somewhere (that would be the taxpayers).

Point two: “Empower our workers and ensure that all Americans contribute their fair share“. This point is about Unions, jobless training, and cost-shifting.

Hillary wants to ensure that Unions are strong. Unions, however, are losing their value in America (see previous article on this topic). The two key areas that Clinton mentions in referencing the “Employee Free Choice Act” are fair wages and safe working conditions.

Two factors now exist that help ensure workers are paid fairly: market forces and federal law. Most reputable companies can see the value of paying their employees a fair wage, and do so. We have not seen any studies providing salary comparisons between union and non-union organizations, but based on anecdotal evidence, it seems Unions do not bring much value in this area. And they cost employees money (dues).  And as the time of Unions begins to wane due to their lack of real value, membership declines and the need to force non-Union members to subsidize the supposed benefits they receive indirectly becomes the new battle cry to continue financing the fat cats.

Worker safety should be managed under the domain of the Occupational Safety and Health Administration (OSHA). OSHA should be handling any safety concerns.

Hillary also promotes additional bureaucracy in the form of a “trade enforcement officer” and doubling the size of the US Trade Representative enforcement unit. The purpose is to have more effective enforcement of our trade agreements. Frankly, we need to review and renegotiate some of our agreements. the Clinton administration produced agreements that are key to the loss of jobs to Mexico and elsewhere in the world.

Hillary also promotes overhauling the Trade Adjustment Assistance program. The changes she recommends here are sweeping and costly. Most of the benefits appear to be nice but not absolutely necessary. If we can work on preventative measures to stay out of trade related job loss and focus on keeping jobs in the US, this might not be so necessary. The recommendations that Clinton makes here should be stripped down to minimum. The bottom line is, there is not much money available, and the Senator has already been critical of the national debt.

Point three: “Restore fairness to the tax system“. We totally agree with this statement, but we know that Clinton is not talking about the Fair Tax. Ultimately, we see fairness in the tax system coming about when spending is dramatically cut  and the burdensome complexities of the existing tax code are eliminated. Hillary, however, is looking at rebuilding the existing progressive tax percentages to ensure a larger portion of money earned by the “rich” is taken in as revenue.  See DJ’s posting earlier this week.

So far, it seems that Clinton’s answer to everything is to spend more money. So where does the money come from???

And keep in mind, any taxes assessed to corporations will simply become a hidden expense to us since any additional tax expenses simply get passed on to customers. We see the taxes as increases in product prices.

In Part 3, we will examine Clinton’s other plans to improve the lives of the Middle Class.

About the Author

Mr. Smith is the Publisher of The Conservative Reader. He is Partner/Owner of Ambrosia Web Technology as well as a Systems Architect for Wells Fargo. Art hold a degree in Computer Science from Drake University in Des Moines, Iowa, and is a political blogger at the Des Moines Register. Art's views are purely his own and do not necessarily reflect the views of Wells Fargo.

 

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