American Economy: The Race to the Bottom
Brookfield, WI – Even before the pandemic, America was dealing with serious economic issues. Democrat Tom Palzewicz, running for the Fifth Congressional District seat, has seen the economic issue from several vantage points and wants to bring fairness and equality to the American dream.
The stock market has done well for some time, but has the average American benefited from the rise in the market? The system is not designed for the guy on the street as much as it is designed for Wall Street. Palzewicz describes this as the race to the bottom.
“Between 1946 and 1980, wages grew at about a four to five percent annual rate. The stock market grew between two and three percent. The middle class was created. Since 1980, the stock market has grown five percent and the wages have gone up two to three percent. The middle class has been decimated. That’s all you need to know, because productivity has continued to climb and those productivity gains have gone to the stock market or capital and not to labor.”
Millions of Americans are out of work, but the very wealthy are gaining in economic strength. Big business is squeezing and crushing little business. Workers are being left out of the game.
“Most people don’t understand this. Even during the pandemic, Jeff Bezos‘ (Amazon) net worth has gone up by $13 billion, but he can’t afford to pay his essential workers a living wage? He can’t afford it? He gets richer because capital gains are taxed at a much lower rate than wages.”
The worst thing to be in America is a W2 employee because of unfair tax laws.
“People in the Fifth District need to understand that if you make $250 thousand working and your neighbor makes $250 thousand investing, you will get taxed three times higher,” said Palzewicz. “How is that fair? It isn’t fair. But we have been sold a bill of goods that says it is fair. We get told that the guy that made $250 thousand investing created jobs. No he didn’t.”
Palzewicz worked in banking, in risk management. He understands how money works and how the rich get richer.
“When I was in banking I had a boss that was explaining bonuses,” Palzewicz recalled. “He said ‘We as a division get X amount of dollars. Imagine a cup. Our head person in the division has the biggest cup and when her cup gets full, some of it trickles down to her managers’ cups and when theirs is full some of that trickles down to you. Some years some trickles down, other years it doesn’t. Now is that supposed to make me feel better?”
“The reason there are billionaires is it’s not about the money, it’s about the scorecard,” Palzewicz explained. “They compare themselves to others by how many billions they have been able to amass. It is absolutely the worst scorecard for humanity because it doesn’t help anybody. We need a better scorecard for how people bring value to the world.”
Palzewicz believes there needs to be a better scoreboard to measure success. Money isn’t the only barometer of a healthy country.
Republican administrations over the years have favored tax breaks for the richest one percent of Americans. Some wonder if those tax breaks could come with a caveat, such as offering higher wages and more benefits. Corporations earn countless billions, but did not necessarily pay for the talents and abilities used to make all of that money. Attempts have been made to tie tax reform to employee benefits, but they failed.
“Barack Obama tried to do that and was hammered for it, because people just didn’t understand what he was telling them,” Palzewicz said. “He said to business owners, ‘You didn’t build that.’ If business owners had to get their employees to work, if they had to build the roads and provide the transportation, if they had to educate them from birth, if they had to make sure there was clean air and clean water to keep them healthy and get to work, they couldn’t afford it. Taxes are a way of sharing those expenses.”
Palzewicz is looking forward to reaching across the aisle and working with Republicans to bring fairness and equality to the American economy.
Palzewicz for Wisconsin
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