Blog #4 – Lots of Debt = Public discontent?
This past week we looked at the events leading up to the Constitutional Convention and included the debt-ridden, farmers’ rebellion known as Shays’ Rebellion that occurred in 1786-87. Because of rampant inflation and other economic factors, former Revolutionary War soldiers couldn’t pay off their mortgages and were faced with jail time in debtors prison, seizure of valuable property or foreclosure on their homes. To prevent the foreclosure of their homes, the farmers in rural Massachusetts, led by Daniel Shays, closed courthouses all around Massachusetts. Only when a private militia (hired by the moneyed interests of Boston) opened fire on the mutinous men of the rebellion did it finally end.
An event like this convinced those on the fence that a stronger central gov’t. was needed to deal with the systemic problems of the Articles of Confederation.
Today, some groups like the Tea Party advocates (Tea standing for Taxed Enough Already) believe that we have drifted far away from this founding legacy of “small government” and that our current gov’t. is way too strong and intrusive in our lives. We see this intrusion in regulations on corporations and other businesses, excessive federal spending, and changes to health care. Many of these groups appear to be grass-roots and decentralized, lack a specific political platform, have a little bit of party money and haven’t rallied around a national leader, according to The Washington Post’s survey of the nation’s TEA Parties published on Oct. 24.
Virtually all of the 650 groups surveyed identified opposition to President Obama’s and the Democratic Party’s policies. The groups also identified economics as a major concern, and this is no surprise considering the country’s economic mess since 2007. 
As you can see by the chart on the left, the US economy finally came out of its epic doldrums in 2008 in 2009 with some small signs of growth. For the first two quarters of 2010, there has also been growth as well (3.7% 1st qtr., 1.7% 2nd qtr), but nothing major.
As shown in the graph below in GDP growth/loss by states, Michigan and Florida had the worst GDP losses in 2007-08 (the yellowish states are the worst hit by this recession). 
(1)
In the summer of 2010, home foreclosures hit a record high of almost 270,000 homes in the 2nd qtr (2). Some of these foreclosures have been questioned b/c it appears that many banks may have kicked people out of their homes w/o “reading the documents.” According to Fox News, in the latest 3rd qtr, almost 290,000 homes were foreclosed, and the banks are on pace to hit 1.2 million by the end of the year (3).
Like the farmers in Shays Rebellion, many homeowners have either lost their homes to foreclosure or seen the value of their house drop so significantly that the mortgage isn’t worth paying off (called an underwater mortgage). Therefore, a number of people have walked away from their homes and let the banks have them. Currently, over 1/2 million homes are owned by banks that aren’t even on the market (3).
Tea Parties have complained a lot about taxes. They’ve also complained, and rightly so, about out-of-control government spending.
If you ever wondered how much money is taken in by the government in taxes, here’s a breakdown:
The federal Government will take in $2.6 trillion for FY2011. The individual taxpayer — you — provides the bulk of this. Here’s how:- Income taxes contribute 45%.
- Social security taxes are 34%.
- Corporate taxes are only 12%.
- Excise taxes and other make up the remaining 9%. (4)
How is it that corporations only pay 9% of our tax burden? Maybe that’s where the gov’t. and Tea Partiers should look for more money.
Or maybe the gov’t. should do with less like the rest of us, especially those who are directly affected by the auto industry. Would it hurt the nation terribly to cut all expenses by 1-2% for the next year? It probably would, but how much has the government’s stimulus package really benefited the country?
The worst part about all of this is that when the country needs the two parties to work together to get us out of this mess, the parties are at a historical point of fighting with each other. Not since the end of World War 2 have the two parties voted only for their own party’s programs and voted against the other party’s program. Between 85-90% of each party’s members have voted for their own bills and against the other party (5).
So, what do we do?
Your question (pick two of the following):
1. Do you think an armed rebellion like Shays could happen today based upon home foreclosures or another source of discontent? Why or why not?
2. Why don’t you think the federal government is willing to cut expenses even slightly to either cut taxes or to reduce our federal budget deficit?
3. What do you think the long-term consequences will be with so many homes being foreclosed, especially this year?
4. Do you think the Tea Party protest is just a one-time thing like the Bull Moose Party (1912) or the States’ Rights Party (1948)? Or will it be around to be a real contender in 2012? Why or why not?
250 words minimum.
Take a look at partisan politics during the Jefferson and Madison administrations:
Sources:
1. http://www.bea.gov/newsreleases/glance.htm
2. http://articles.latimes.com/2010/jul/15/business/la-fi-foreclosures-20100715
3. http://www.foxnews.com/politics/2010/10/14/record-number-foreclosures-face-challenge-court/
4.http://useconomy.about.com/od/fiscalpolicy/tp/US_Federal_Budget.htm
5. Brownstein, Ronald. The Second Civil War: How Extreme Partisanship has Paralyzed Washington and Polarized America. Penguin Press, NY. 2008.
1. I do not think a rebellion like Shays could happen today based upon the home foreclosures. The major difference between now and then is, people are being thrown in debtors jail due to their lack of money. Today a rebellion similar to Shays’ would not be possible because there is a strong central government under the Constitution that was lacking in the days of the Articles of Confederation. We have a military that would put down any attempt at a rebellion that could respond extremely fast unlike in the time of Shays because there is a national army.
4. I do not think the Tea Party will be a prime contestant in future elections, although they may stick around for 2012, it will not have much success. The Tea Party is already drifting away from the Republican party. The Chairman of the party currently does not support many of the Tea PArty candidates such as Christine O’Donnell. THe history of the United States shows that only two parties can be successful in American politics due to the plurality system of elections in our country today. In this system candidates only need the most amount of votes which is not always the majority, unlike France. IN France the majority is needed to win the elections, therefore they only need 1/8 of the votes to qualify for a runoff election if no candidate has already won. This favors more parties so near rivals can make an alliance to win the runoff election. In the United States, these alliances must be made before the first election because there is no other chance. The last presidential candidate to win any electoral votes was George Wallace from the American Independence Party, more than 40 years ago.
1. I do not think an armed rebellion like Shays could happen today based upon home foreclosures or any other source of discontent because we now have a strong constitution. The only reason the Shays rebellion could work was the extremely weak national government that was created under the Articles of Confederation. Under the strong constitution, no rebellion over home foreclosures has ever come close to succeeding. The United States army is now one of the strongest if not the strongest in the world, unlike during Shays when it was nonexistent. For it to be possible for a rebellion as successful as Shays to occur in current times, it would require near full participation, and a very distracted national government. The current United States is far to strong to possibly be affected by a small, simple rebellion over home foreclosures or just about any other source of discontent.
4. I think that the Tea party protest is just a one time thing, but will most likely carry over into the 2012 election. I believe that it is just a movement that is reacting to the current state that America is in, and once this recession is gone for good, it will also be gone for good. The recession will most likely be gone by 2012, however if it is not or if the Tea Party tries to take credit for the success, they will most likely still be around. If they are around, the 2012 election will most likely end them because I believe they will split the party and allow for an easy reelection for Barack just as a third party has done many times before. Either that or they will radicalize the Republicans and Barack will gain the moderate vote, allowing him to win.
1. Do you think an armed rebellion like Shays could happen today based upon home foreclosures or another source of discontent? Why or why not?
No, I do not believe an armed rebellion like Shay’s could happen today in the United States of America. For numerous reasons starting with, we have very different ideals now then they had back then. It seemed alright to them because they had just overthrown the British government, so it was no longer weird to stand up against the government. They also were better trained to fight and after so many years of fighting they were better able to organize and fight back. I also feel that people have moved away from being open to violent outbreaks as a means of solving their problems. All things considered, I honestly and truly feel that we as Americans have evolved to the point where we can deal with our problems like civilized people and not like savages…
3. What do you think the long-term consequences will be with so many homes being foreclosed, especially this year?
I think the long term consequences will probably be a longer economic period of hardship. I also fear that with all these people losing their homes they may start to not trust the banks anymore. I feel people will be very upset but in the long term will recover. My only fear is that this will affect the economy for the next five years or so because all the sudden you have a flood of cheap homes and you have homes that are recently built, people might rather go for the cheap home and put work in as opposed to buying the new home and then you have a bunch of architects unemployed and not building homes and then their suppliers aren’t selling as much and it will have a domino effect.
1. An armed rebellion like that of Shay’s will definitely not happen. There are over 300 million people in the United States and if one million get foreclosed upon then there are still millions who are leading unhappy lives but at least have homes. Plus, what could the people do? The country is almost five times as large as it was 200 years ago. And seizing one little armory will not give them enough power to go against the majority of other Americans. An uprising would be crushed at once. There could be riots like those of France where everyone is “peacefully” protesting. It might bring around some change but more likely the people who couldn’t pay their bills will just have to deal with it.
2. If the economy goes back up and people are helped out by the government. The tea party will probably go away but it will still be here by 2012. It will most likely be a onetime thing like the Bull Moose Party and the States Rights’ Party. It will not be a real contender in the 2012 presidential election though, because the likeliness of it getting a large enough base of support is close to zero. It might bother the other candidates by getting some votes but it won’t get a state and it sure won’t win the presidency. The government is too narrowly focused on a two party system of government. Republicans and Democrats for now will be the only parties to win the presidency.
#2I think that the federal government is unwilling to cut expenses even a little bit not because they don’t want to, but because everyone in Washington wants to cut everyone else’s programs, while no one wants any of their own touched. Meaning that the Congressmen from the western states might rally to cut some bridge program in the southern states, causing the southern Congressmen to unite against the westerners and look to cut something different instead. Thus, nothing ends up getting cut. In addition, easy cuts, like pork barrel projects, make up a very miniscule part of the federal budget, so in order to make any real cuts the government must cut in areas that the public would actually notice. This is heresy to the commoner, who generally wants low taxes but high government services (I won’t digress into the ludicrousness of this) and hence they elect representatives who pledge to not cut things in their personal district but instead go on a crusade against others. Therefore no one in the government is able or willing to make any serious budget cuts, no matter how dire of an economic situation we may be in.
#4I think that the Tea Party has more lasting power than other third parties in the past, but will soon weaken and eventually die out. It will outshine the States’ Rights and Bull Moose parties because it deals with purely economics, which is a very lasting issue, but economics will also ultimately be its downfall. History has shown that one issue parties have never survived, like the Free Soil party. They serve to galvanize the public and make a point to our representatives, but they are not robust enough to actually survive. Lastly though, I believe the Tea Party will be helped in lasting by the fact that it is not actually independent from the Republican party and thus still earns Republican support. If it were to break away it would quickly flounder. Therefore I think that because of the nature of the Tea Party movement, it will last longer than many people think, but will eventually die out.s
1) I thik that if the conditions were right, the people would be ready for an armed rebellion. However, the consitions are all wrong. If we’re referring to the Tea Party movement, the supporters are all spread out. There is no (known) centralized organization that is vehemently against the government in America. It is just inconceivable that a mass rebellion may occur. Riots in towns or even on capitols are not out of the question, but nothing like the civil war or even Shay’s rebellion would probably happen. The operation could easily be prevented before it began.
2) The government is probably against budget cuts today because there are so many projects they are comitted to funding. They have become involved in so much and now they have the responsibility for too much. Too many interest groups are influincing the government and a cut anywhere would cause and uprising everywhere. But the cuts are needed. Also, some politicians may be operating under the policy of Keynesian economics, Spending while you’re down and save while you’re up.
1. I think that the people today could most definitely form a violent rebellion based on the number of home foreclosures in the country. There are a huge number of home foreclosures due to the high unemployment rates in our country and especially in the state of Michigan. A lot of people are looking for jobs and are loosing their homes because of their search for a job. This causes a lot of stress on people and could, if it got serious enough, cause another violent rebellion like Shay’s Rebellion during the revolution.
2. I think that the federal government is not willing to cut expenses because it wants to keep running the programs that are already installed. If they cut taxes, they would have to cut their expenses, and if they cut expenses they cut benefits for all citizens. The only way to get rid of the deficit is to either tax more so that there is more money coming in to pay off the debt, or to cut funding for certain programs or cutting benefits completely which would really make citizens unhappy, and could, relating to the first question, even cause another violent rebellion just like during the Revolution. When there are large groups of people conflicting with the government, which is where violence can occur between the people and the government. Most of the time when the government increases taxation, the people are unhappy with that decision and that is when they would be likely to complain or to even revolt against the current government leaders making the decisions that they disagree with.
1. Yes, I do think the Founding Fathers were right to distrust the passions of the American people when they wrote the Constitution. The passions of American people are heated and constantly changing. The American people say they want something, and in their minds, it probably sounds like a good idea. When it is actually constructed and tested out in public, it may not go exactly as they had planned it would. Since the passions of the American people are ever changing, the people themselves do not always know what they want. The Founding Fathers could not have created a Constitution based on what the people thought they wanted, because eventually, people’s passions would die out and change, and they had to create the Constitution in the best interests of the country.
2. There are many problems in our society that people are passionate about and fear as they go to vote today. I would say the economy is the largest problem. People are worried that not much is being done to improve the state of our economy in a timely manner. They want to see results, and while they are not seeing the results they want from the people already in Congress, they might reelect new people to it and see how they fare and if they will approach the problem more efficiently. If they are experiencing a crisis in their lives, like their houses being foreclosed, they will vote for who they think will provide them with the most help. These kinds of passions can lead people to vote for candidates who they might not have originally voted for if they were not in situations like that.