Are Democrats Wrong for America?

Nancy Pelosi and the Democratic Party based their recent campaign on taking America in a "new direction". A recent article Democrats' "New Direction" is Wrong Direction for America published by Greg Reeson criticizes the "new direction" plan of Nancy Pelosi and fellow democrats addressing issues such as raising the minimum wage, taxing the top 50% earners in America, and the Iraq war. In his attempt to "inform" voters, Greg Reeson does not correctly present all facts in his argument.

Raising the minimum wage
The current federal minimum wage is $5.15, which has not changed since 1997. Some states have higher minimum wages, but are not required. Taking inflation into consideration since 1997, what would cost someone $5.15 in 1997 would cost them $6.07 in 2005. According to the Department of Labor, approximately 50% of workers earning $5.15 were under the age of 25, with one third of that group aged 16-19. Unfortunately, the remaining 50% earning minimum wage were over 25 years of age. Furthermore, of every person-earning minimum wage, only 24% of those were working part-time. This could hardly be considered the majority since the Department of Labor did not identify the age of part-time workers. More than likely, the age group under 25 worked a majority of the part-time jobs since they are typically in high school or college.

Greg Reeson justifies raising the minimum wage by stating "an increase in labor costs that is unrelated to market forces will encourage businesses, small and large alike, to let go of unnecessary workers, cut back on shift lengths, and delay potential new hires." However, Greg Reeson fails to note that the age group with the most buying power is in fact young adults aged 13-21 with nearly $156 billion spent a year. Even more, young adults who earn a paycheck are most likely to spend the entire amount. If the minimum wage were raised the money would most likely go back into business and corporations. However, with the current rate of inflation and no raise in minimum wages, young adults earning a paycheck have less to spend, meaning less money going into the economy.

Raising taxes
In a recent article Government Accountability Office - Addressing the U.S. National Debt I addressed the fact that if the 2007 budget is passed the American national debt will exceed $10 trillion dollars. Unfortunately, it does not matter who is in power, taxes will have to be raised in order to balance the budget. Eventually, if the U.S. government keeps spending money they do not have, creating deficits, they will not be able to fund federal programs and promises they have pledged. In order to pay for the war in Iraq and other federal programs taxes must be raised.

Greg Reeson and Rush Limbaugh argue raising the taxes of the top 50% of wage earners is unfair, quoting a statement released by the IRS revealing that the top 50% of wage earners pay 97% of federal taxes. However, they fail to define the earnings of the top 50% of the taxpayers. The top 50% of wage earners paying the 97% of federal income taxes were individuals or couples who earned more than $26,000 in a year. Unfortunately, if an individual or couple is earning less than $26,000 a year, there is not too much money to tax without putting them below the federal poverty level, which was for a family of four $18,850, in 2004.

The top 1% of individuals who pay 34% of the taxes earn $235,000 or more, the top 5% who pay 54% of the taxes earn $130,000 or more, and the top 10% who pay 65% of the taxes earn $94,900 or more. Under the progressive tax, a single person who earned $235,000 in 2006 would have to pay $64,412 in taxes, or 27% of his income. An individual who earned $26,000 would owe $3,523 in taxes, or 13.5% of his income. If the individual who earned $26,000 were forced to pay 27% of his income in taxes he would owe $7,020, leaving him with less than $19,000. This hardly seems fair to me!

The war in Iraq
Greg Reeson argues a civil war in Iraq will be the result of pulling the American troops out, stating the only way to win the war is to put more troops in Iraq and stay until at least 2010. However, the only current war in Iraq is a civil war. The Iraqis are now fighting other Iraqis. Our soldiers are being killed because the Sunnis and the Shi'ites are warring amongst each other and unfortunately, the U.S. military are being murdered. There is no guarantee that U.S. military staying until 2010 will stop this civil war.

Nancy Pelosi and other democrats argue the Iraqi government must begin to enforce their own laws and legislation and if they do not, then the U.S. will begin to withdraw troops.

The "new direction" argued by Nancy Pelosi takes into consideration the economic factors of raising the minimum wage, the necessity to raise taxes and become fiscally responsible, and finally a realistic strategy for bringing not just our troops, but all the military troops who sacrificed time and family to fight in the Iraq war, home. This is the "right direction" for America.