One of the big lies that we’ve been told over
and over again for years, and again some Americans start to believe it because they hear it over
and over again, is that if you give tax cuts to the rich and to the corporations everybody
will benefit. It will all trickle down to everybody else. A lie. It has not happened.
It has never happened. They don’t need more tax cuts. Big corporations are now sitting
on two trillion dollars of cash. There are higher corporate profits now then that we
have seen in 35 years. The ratio of corporate profits to wages is now higher than its been
since before the great depression of the 1930s. And so when you hear somebody say the corporations
need tax cuts or they need regulatory so-called relief, they need to cut their costs, they
need in other words to have even more profits to create jobs, don’t you believe them. That
is a downright bold faced lie. Now another lie you hear over and over again:
If you shrink government you’ll create more jobs. This is unbelievable, how it is by shrinking
government you create jobs. I still… I debate a lot of people, a lot of conservative economists
and others on television who keep on saying this. And I keep on saying tell me your theory,
how is it that if you lay off teachers and social workers and firefighters and police
officers, if you have fewer people building the roads, building the highways, building
the infrastructure, fewer people re-building our schools, fewer people doing all of the
public’s work, how can that create more jobs? And the answer I get is: ‘Government always
gets in the way’. I say, ‘But tell me exactly how is it that
if you shrink government you’re going to create more jobs, particularly when consumers are
holding back because they can’t do it.’ And the answer I get is: ‘Government always
gets in the way’. In other words there is no intellectual basis
for the ideology, and it is purely an ideology that says you shrink government you get more
jobs. If you shrink government you get fewer jobs. But when the private sector is unable or unwilling,
that is consumers and businesses unable or unwilling to spend enough to keep the economy
going at full employment, then government is the spender of last resort. We’ve known
this. We’ve known this for 30 years. After…actually we’ve known it for 80 years. We’ve implemented
over the last 50 years, but we’ve known it for 30 years… even those supply economists
started spouted this drivel about low taxes and trickle down economics. We’ve known it. But now we hear this resurgent right saying
no. But beyond a large enough stimulus… and
I think the President did try. I saw his speech. Many of you saw his speech. He sounded as
forceful, as dynamic, as strong as I’ve heard him. And he made all of the right comments
we need… By the way, I wish he would have said one
thing: The primary objective is jobs, not deficit reduction. We need jobs, not more
cuts in the deficit. That is the primary objective. (applause) And he came up with the jobs plan that is
a good beginning, but it’s not nearly large enough to do the size of the job that we need
doing in this jobs crisis, in this economic crisis. You remember the baby boomers? How many of
you were born between 1946 and 1964? All of you. No. (laughter) Well we boomers had the advantage of huge
investments in public education and higher education, in public higher education. Huge
expansion. We invested in infrastructure, we invested in education. We had a tax structure
in those years in which the top income earners never paid below a marginal income tax of
70 percent. 70 percent. In fact under Dwight David Eisenhower, who nobody would call a
socialist, I don’t think we would. Some would now? Yes. (laughter) The top marginal income
tax rate on the top earners was 91 percent. And even with deductions and tax credits that
still meant that they were paying an effective tax rate of hugely higher than they are today.
And yet the economy grew faster. That lie about trickle down, the lie that
we must not tax the rich because that would deter them from working hard and investing
and creating jobs is nothing but a bald-faced lie, based on ideology rather than facts.
(applause) And just like the 1950s when I was told by
my father the debt is going to be the biggest… no! The debt, if you get growth back, if you
get jobs back, the debt shrinks as a proportion of the national economy. It becomes more and
more manageable. And by the way, here’s another lie. They are
saying that the long term debt that’s out there ten years from now is all because of
Medicare and Social Security and all of the spending, it’s not. The long term debt out
there is because of rising health care costs. Medicare is the most efficient system we have.
(applause) The administrative cost of Medicare are so
tiny relative to private insurance that what we really need, if we want to get Medicare
and medical costs down in the future is Medicare for all. (applause). And then we could move from a fee for service
system to a fee for healthy outcomes system and that’s what we need to do. (applause) Now anybody who tells me that Social Security
is a Ponzi scheme, I’ve heard that recently. Can you imagine the irresponsibility, I mean
look it, putting partisanship to one side, how… I’ve never heard a public official
running for national office who lies through his teeth by saying the Social Security system
is a Ponzi scheme. I was a trustee of the Social Security trust
fund. I know exactly what the actuaries project. For the next 26 years is purely solvent, completely
solvent. There’s no problem. Beyond 26 years the only reason there is a problem with potentially
being able to pay out everything that Social Security owes beyond 26 years, you know why?
Because of raging inequality. Because so much money has gone to the top that the proportion
of income subjected to Social Security taxes is not going to be enough. And that’s why
the easiest, most direct response to post-26-years-from-now is to raise the cap on individuals with incomes
over (inaudible)(applause). So we got to tackle inequality, and how do
we tackle inequality? Well one thing we can do is have tax reform that is real tax reform.
Not the kind of Republican tax reform that says we got to raise taxes on the poor, which
is again, as backwards as every other lie they are telling. But the real tax reform
is we got to expand the earned income tax credit which is a great subsidy for the poor.
We’ve got to reduce taxes on the middle and the lower middle and we got to increase taxes
on the top. Have more tax brackets! More brackets. Go back to where we were before. The greatest enemy… the greatest enemy we
have is mass cynicism. When people really get to the point where they think nothing
can be done, the other side wins. That’s what they want, by the way. That’s what they want.
They want government because it is starved for money, because it is going to be underfunded
— all the regulatory agencies—they want government at all levels to function so badly
that people say ‘well government can’t work. I told you.’ And they also want politics to be so bad and
so paralyzed that most Americans say ‘nothing can be done. I’m going to give up on our democracy.’ They win. Don’t allow cynicism to effect our body politic.
Don’t allow cynicism to effect your neighbors or your friends or anybody. (applause) It is easy when they are scared and disorganized
for people to be subject and vulnerable to demagogues who come along and say to them
‘you know, the reason you’re in trouble? The reason you’re in trouble is because of government.
Or it’s because of immigrants. Or it’s because of the poor. Or it’s because of blacks. Or
it’s because of a number of scapegoats that are offered, always offered up. The same scapegoats. But in reality we are all struggling over
a smaller and smaller share of a bigger and bigger pie. And they are deflecting and diverting attention
from the big story which is that more and more of the income and wealth is going to
the big corporations and to the very, very super rich in this country and that is what
has to be reversed. And that is why we have to take back America.