A NEW GI BILL FOR EVERYONE – Instead of More Wall St. Bail-Outs

[leveymg]

Unemployment figures released today show that more jobs were lost in 2008 than in any year since 1945. Think about that for a second.

A lightbulb should pop up – how did the United States avoid a major recession at the end of World War Two, when millions of servicemen returned to the civilian workforce, and there were massive layoffs as defense plants shut down?

One short little term saved us – the GI Bill.

Compare that to TARP. What are we getting from the $2.3 trillion being thrown at Wall Street? Have you tried to get a mortgage or car loan lately?

Something like the GI Bill is needed again. What we can’t do is pour more money down the rat-hole into big banks and huge, multinational corporations.


What was the GI Bill? Basically, beginning in 1944, the government financed returning soldiers purchase of homes, subsidized their higher education (GIs could attend school full-time and live modestly on the stipend provided), and handed out low-interest gov't backed small business loans. Everyone who couldn’t find a full-time job or school enrollment got a year’s worth of unemployment. That aid went to every discharged soldier, regardless of their credit scores – there was no Equifax then, and maybe we can do without it again.

What did the GI Bill do?

• An important feature of the G.I. Bill was low interest, zero down payment home loans. This enabled millions of American families to move out of crowded urban apartments and into suburban homes. A burst of new construction kept the expected explosion in rents down, and provided employment.
• A second provision was the 52–20 clause. This enabled all former servicemen to receive $20 once a week for 52 weeks a year while they were looking for work. Eighty percent of the money set aside for the “52–20 Club” was never distributed, as most returning servicemen quickly found jobs or furthered their educations.

The Second GI Bill followed the Korean War. Most of this was in the form of direct grants to veterans. By the end of the program in 1965 approximately 2.4 million of 5.5 million eligible veterans had used their benefits. 1.2 million had higher education and student living expenses paid, over 860,000 used the money for other education purposes, and 318,000 for occupational training. Over 1.5 million Korean Conflict veterans obtained home loans.
_______________________

Now, almost everyone agrees - that government stimulus package worked. We need to do something like it again - and, STOP THROWING TAXPAYER MONEY DOWN THE WALL STREET RATHOLE! That wasn't part of the GI Bill, as far as I can determine.

And, how did the U.S. pay for all this? They raised taxes on upper incomes. The marginal tax rate on incomes more than $200K was 94 percent in 1945. In 1939, it had been 79% on incomes over $5 million.

The Revenue Act of 1942 was the largest Federal tax increase in history and at the same time raised top rates and cut loopholes.(1)

With the enactment of two revenue-increasing acts in 1940, and one each in 1941, 1942, and 1943, and with the payment of greatly broadened income tax made easier and simpler by special legislation in 1943 and 1944, the job of war taxing and spending was largely completed by the end of 1945. But, the job of keeping the American economy running was not completed at that point. Marginal rates on upper incomes dropped only slightly during the next two decades, remaining at 91 percent on incomes over $400,000 until 1963.(2)

Next time a Republican says the New Deal and federal stimulus programs didn’t work, and the thing to do is to lower taxes, remind them about the G.I. Bill.

And, this time, let's do this without another World War.

In fact, we might want to remind our Democratic leaders about the same history lesson.

____________________________
2009. Mark G. Levey


(1) http://www.nationmaster.com/encyclopedia/Revenue-Act-of-1945

(2) http://www.truthandpolitics.org/top-rates.php

____________________________
Also available in Orange at: http://www.dailykos.com/story/2009/1/9/113733/1492

[blm]

1. A government stimulus package that PROVED it worked for this country and the world economy. K&R

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[antigop]

2. I approve this message, Thanks, leveymg. K & R n/t

[blm]

4. Gonna keep this kicked.

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[terisan]

3. It may be what will work. I think we need to object to the current stimulus plan.

What the Original Bill of rights had was a focus on individual rights, and the GI Bill of Rights or Serviceman's Readjustment Act followed that model-in other words it had an important historical antecedent

Would this be presented as a Citizen Bill of Rights- Economic Readjustment Act?

I believe this would get a lot of backing from citizens, at a time when people are seeing Wall Street and Big Banking as instigators of our current problems.

Some aspects of health care could be included.

It does reframe the situation in a way that makes sense to people

[dionysus]

5. excellent post, welcome to DU

[leveymg]

6. Thank you, but I've been here for six years

Just haven't posted much since I got busy with the campaign and a book deal during the late summer.

Check out my diary. :hi:

[dionysus]

10. hot damn how did i misread your post count...

:crazy:

[babylonsister]

7. Rec'd. There are good lessons to be learned from history.

I hope you send this to change.gov What the heck, why not?

:hi:

[sarcasmo]

8. Kick, that is much better stimulus than tax cuts.

[satya]

9. Perfect response to "only a war will save our economy" talk I keep hearing. Well done! nt