Robert B. Reich's Blog, page 70

First 100 Days: Trump and the Degradation of the Presidency

Trump’s failure to accomplish little or any of his agenda during his
first 100 days is...

Free Speech (Update)

Coulter is back. Today (Thursday), officials at the University of California, Berkeley, changed...

Free Speech

Today, officials at the University of California, Berkeley, where I’m
a professor, canceled a...

4 REASONS WHY TRUMP’S PLAN TO STRIP THE IRS IS INCREDIBLY...

4 REASONS WHY TRUMP’S PLAN TO STRIP THE IRS IS INCREDIBLY DUMB

Donald Trump is proposing a 14.1 percent cut in the I.R.S.’s budget next year. This is incredibly dumb, for four reasons:

1. It won’t save money. To the contrary, this move worsens the budget deficit. That’s because every dollar spent by the IRS to collect taxes generates $4 in unpaid taxes.

2. It worsens the federal budget deficit. The current estimate of unpaid taxes per year is almost as large as the federal government’s annual budget deficit.

3. It widens inequality. Since most IRS audits are of high-income people, the real beneficiaries of Trump’s move are the wealthy, more of whom will now be able to skirt their duty to pay taxes.

4. The IRS is already understaffed. The number of individual tax return audits fell last year to its lowest level since 2004, and enforcement levels were already down by nearly 30 percent from 2010.

Donald Trump hates the IRS and has spent years battling it. There’s reason to think he doesn’t even want to pay his own taxes. But this is no reason to explode the Federal Budget Deficit and give another windfall to the rich.

The Only Real “Centrist” Agenda

With Steve Bannon on way out, official Washington is jumping for joy that
Gary Cohn – the...

The Trump Doctrine

What’s the “Trump Doctrine” of foreign policy? At first glance,
foreign policy under Trump seems...

The World According to Trump

The starkest difference between dictatorships and democracies is that
democracies are ruled by laws,...

Why is the Department of Justice Defending Trump’s Fleecing of America?

Trump’s business (now run by his two adult sons) has 157 trademark
applications pending in 36...

Update for Trump Voters

1. He said he wouldn’t bomb Syria. You bought it. Then he bombed Syria.2. He said he’d build a...

THE TRUTH ABOUT TRUMPONOMICSWhen Donald Trump spoke at Boeing’s...

THE TRUTH ABOUT TRUMPONOMICS

When Donald Trump spoke at Boeing’s factory in North Charleston, South Carolina – unveiling Boeing’s new 787 “Dreamliner” – he congratulated Boeing for building the plane “right here in the great state of South Carolina.“

But that is pure fantasy.

Trump also used the occasion to tout his “America First” economics, stating “our goal as a nation must be to rely less on imports and more on products made here in the U.S.A.”

Trump seems utterly ignorant about global competition – and about what’s really holding back American workers.

Start with Boeing’s Dreamliner itself. It’s not “made in the U.S.A.” It is assembled in the USA. Most of the parts and almost a third of the cost of the entire plane come from overseas.

For example:

The center fuselage and horizontal stabilizers came from Italy.

The aircraft’s landing gears, doors, electrical power conversion system - from France.

The main cabin lighting came from Germany.

The cargo access doors from Sweden.

The lavatories, flight deck interiors, and galleys from Japan.

Many of the engines from the U.K.

The moveable trailing edge of the wings from Canada.

Notably, the foreign companies that made these parts don’t pay their workers low wages. In fact, when you add in the value of health and pension benefits, most of these foreign workers get a better deal than do Boeing’s workers.

These nations also provide most young people with excellent educations and technical training, as well as universally-available health care.

To pay for all this, these countries also impose higher tax rates on their corporations and wealthy individuals than does the United States. And their health, safety, environmental, and labor regulations are stricter.

Not incidentally, they have stronger unions.

So why is so much of Boeing’s Dreamliner coming from these high-wage, high-tax, high-cost places?

Because the parts made by workers in these countries are better, last longer, and are more reliable than parts made anywhere else.

There’s a critical lesson here.

The way to make the American workforce more competitive isn’t to build an economic wall around America.

It’s to invest more in the education and skills of Americans, in on-the-job training, in a healthcare system that reaches more of us. And to give workers a say in their companies through strong unions.

In other words, we get a first-class workforce by investing in the productive capacities of Americans  – and rewarding them with high wages.

Economic nationalism is no substitute for building the competitiveness of American workers.