Trickle-down economics has failed to produce an economy that works for all. The strategy to make the wealthy even more wealthy in hopes of creating jobs has only made the wealthy even more wealthy. It has not impacted the median income earner or to any significant degree the unemployment rate.
We need a new strategy to grow the economy. With 70% of the U.S. economy dependent on consumer spending, a strategy to put money into the hands of those who would spend it is called for. The top 1%, who enjoy great buying power, simply cannot spend their money fast enough. A saving rate of 25% is evidence of this.
We need to embrace the principles of 'middle-out economics' which identifies the middle class as the true job creators. Only the middle class can spend at the rate necessary to grow the economy. To grow the economy it will be necessary to put more money into the hands of those who would spend it by enacting a more progressive tax code. It will be necessary to raise taxes on high income earners, and lower taxes on median income earners. This revenue neutral and more progressive tax code will put money into the hands of median wage earners who will spend it. With increased spending, a greater demand for products and services will result, which will help to grow the economy. A growing economy will allow for greater employment opportunities. 3/17/2014