This post was originally posted at The New Democrat on Blogger I'm going to try to put this in a way that perhaps even a Libertarian or Tea Partier could understand. The caller in this video as Senator Sanders said laid out real well or perfectly as I would put it what demand side economics is. Which is when someone invests in something or creates a new product or service that people want at an affordable rate that investment will pay for itself because of the consumer demand that it will bring in return with people buying that product or service. And then of course the money that goes back in the economy and the jobs that get created as a result.
As far as government is concern when it comes to investment. I'm not here to try to make a case that all government investment is good and good for the economy. Or as let's say the further left is concern "all non-defense or security related investment is good for the economy". Why because people who actually believe in that do enough of that all the time. But the things that government should be investing in as it relates to the economy they should be investing in it a hell of a lot more and do it in a fiscally responsible way. And infrastructure investment is a perfect example of that.
Government awards money to construction companies to fix and build new infrastructure and now what do you have, but companies with work to do and of course they need workers to do the work. So that is where the jobs come in and now people who weren't working last week and collecting a public assistance check are working this week collecting a solid pay check for the work they do. What do they do with that money is pay off current bills that they didn't have the money for previously. But each further check goes into the economy to pay those workers bills and for them to live well and enjoy life. Which creates new jobs because of the new consumer demand.
Demand side economics is a term that I wish I've been using a long time ago. But that is exactly what it is and a role and not the only role, but a role that government has in seeing that certain projects that the country needs for the economy to be as strong as possible get done and gets done in a fiscally responsible manner. Which puts money in the economy and creates new jobs as well.
I agree with Bob Borosage that there is an emerging economic debate in the Democratic Party about the future of America's economy and what direction we should go in economically. (Good job Bob!) And The New Democrat does it's part to to get the New Democratic liberal economic message out about what New Democrats would do when it came to economic policy. Our pieces yesterday about the income and wealth gaps and minimum wage last night are perfect examples of that.
The main two factions of the Democratic Party are the New Democrat Liberals that basically came into existence with Jack Kennedy when he was in Congress and really post-World War II. President Jimmy Carter and Vice President Walter Mondale and of course Jack Kennedy in Congress and as President were New Democrats as well. Bill Clinton, Al Gore and Barack Obama are all basically New Democrats as well. President Obama actually in between FDR/LBJ and the New Democrats depending on the issue. The other faction are the FDR or New Deal and LBJ Great Society Progressives that came to power with Franklin Roosevelt in the 1930s and Lyndon Johnson in the 1960s.
The other smaller, but perhaps growing faction of the Democratic Party are what is known as the New Left. A bit further left of both the New Democrats and Progressives and have real strong socialist leanings across the board and are really Social Democrats who are pushing for social democracy in America. But right now they are with the New Dealers on economic policy when it comes to redistributing the wealth from the rich to give to government to take care of the poor and struggling middle class.
I mention these things well to put you asleep. No because I'm a political junky. Well the second one is true, but the real reason for the economic debate in the Democratic Party is because we are exactly that. The Democratic Party that believes in inclusiveness and having multiple viewpoints and letting the side that gets the most votes and wins the most support govern. Well most Democrats believe that except for the far-left flank of the party the McGovernites who have strong fascist leanings when it comes to opposition views especially from right-wingers.
But in this debate you have the New Democratic Liberals which I'm a proud member which I believe this blog clearly represents who say that the "main reasons for the income and wealth gaps in America have to do with the education gap". It was as true in 1970 or 1980 as it is true today that the better the skills that you have, the better you'll do in America because of the quality of options that you'll have as far as where you'll be able to work, or even be able to work for yourself. Successful good companies are always looking for the best and most qualified workers to fill their key positions. And will pay and benefit those workers a great deal to have them work for them.
To put it in pop culture terms. "If you have the skills, you'll be able to pay the bills". To translate for the more nerdy and less hip amongst us that means if you have the skills you'll be able to not only support yourself, but able to put money away in case you need it later on. If you don't have the skills, you may end up taking pills (or perhaps alcohol, or stronger drugs hopefully not together) to help you get yourself through your rotten lot in life. Which is poverty and perhaps working multiple low-wage jobs in order to survive. If you are working at all, plus collecting public assistance and private charity to help you survive.
Now the Progressives and Social Democrats in the Democratic Party will say "education and opportunity aren't the problems with the American economy. The problem has to do with the fact that the rich have so much while everyone else struggles just to survive. And if there is any problem with education it's those people who want to privatize it and hold educators and students accountable. And give parents choice in where to send their kids to school. And the reason why the rich have so much and are so successful is because the rules are rigged in favor of them".
Now once you get past the education and educational opportunities part (which was hard two write let alone read without laughing), I mean of course there's a lack of quality educational opportunities in America, but not all of what the let's say further left of the Democratic Party says about the economy is garbage. (To keep this blog clean) Of course the rich are able to negotiate rules that benefit them. That is called lobbying and you have a problem with that change the lobbying rules. And of course they are better represented in the court system when they are sued. Because they can afford the best defense that money can buy. That comes with being rich and successful in America which is part of our system.
And speaking of the system what the New Democrat will say and I'm included is that the problem with America is not that there are rich people or too many rich and successful people in America. The problem with our economy is that there aren't enough rich and successful people in America. Which goes to lack of quality education and economic opportunity in America. Which is the main problem with our economic system and for the lack of economic growth and quality job growth. Meaning the lack of quality jobs that this country produces in America.
The Progressive and Social Democrat will say "nah, that's not the problem with our economy. The problem with our economy is that rich are rich and have too much money. And to go to the distribution point, what government needs to do is to take most of what the rich makes and just leave them enough to survive. And give that money to fund government social programs and create a real welfare state in American to take care of everyone else". The Progressive and Social Democrat wants to share the current economic pot so no one is rich, middle or poor. The New Democrat wants to expand the economic pot so we can all be successful on our own and not need government to take care of everyone.
And that is the current economic debate in the Democratic Party right now. Being debated by the Clintons and President Obama to large extend representing the New Democrats. And Senator Elizabeth Warren representing the Progressives and Senator Bernie Sanders representing the Socialists.
