Sometimes I hear a kind of fatalism from people who care about peak oil that dovetails with the push by deficit hawks and Tea Partiers to cut government budgets.
This is how the argument goes: Since government programs are paid by taxes, and those depend on economic growth, which in turn requires cheap energy, when peak oil comes, many government programs that help the middle class will need to go.
But Robert Reich, who was secretary of labor under Bill Clinton, has an explanation that’s more specific to what’s happened in the last three decades. In his two-minute video “Truth about the Economy,” Reich connects the dots on key points about the economy and taxes, including:
- Since 1980 the US economy has doubled in size, but wages for ordinary workers have remained flat.
- Where’d all the money go? To the super-rich. The top 1% used to take home 10% of the nation’s income. Now they take home double that, 20%.
- All this money at the top has given the super rich lots of political power, especially the power to lower their own tax rates. Before 1980 the top tax rate was over 70% but now it’s only 30%. And the richest 400 Americans pay only 17%.
Because the rich and the corporations they control pay fewer taxes than they used to — even though they make much more money — America is broke. That’s how deficit hawks can justify calls to cut billions from the federal budget in programs for the middle class, including things that peak oilers value such as support for clean energy, conservation and the environment.
To add insult to injury, America’s taxpayers transferred even more wealth from the middle to the top when we bailed out the auto industry and Wall Street.
Sure, peak oil will challenge corporate globalization and may even put an end to economic growth. And we may well now be at the beginning of a peak-oil driven permanent depression that could last decades. But that doesn’t negate the fact that the very rich have plundered the US economy for the last thirty years.
— Erik Curren