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The theory of supply-side economics tells us that if you cut taxes on rich people and corporations, the newly liberated moguls and businessmen will take their windfall and invest it, creating jobs and accelerating the rate of economic growth. The benefits of a light hand on the upper class, therefore, will “trickle down” to the working man and woman.

Ever since Ronald Reagan first attempted to make supply-side economics a reality and proceeded to inaugurate an era of persistent government deficits and growing income inequality, it has become harder and harder to make the trickle-down argument with a straight face. But we’ve never seen anything quite like the disaster that’s playing out right now.

The Wall Street Journal reported on Tuesday that corporate profits are looking quite strong for the second quarter of 2011. Even the Journal can’t sugarcoat the basic facts:

While the U.S. economy staggers through one of its slowest recoveries since the Great Depression, American companies are poised to report strong earnings for the second quarter — exposing a dichotomy between corporate performance and the overall health of the economy.

But that’s just the tip of the nightmare. A newly released study from the Center of Labor Market Studies at Northeastern University, “The ‘Jobless and Wageless’ Recovery From the Great Recession of 2007- 2009,” lays out some extraordinary statistics. (Hat tip: The Curious Capitalist.)

You can read the full article here, but it’s important to note how it ends:

Democrats come in for their share of the blame, too. The worst economic recovery for American workers in history has happened on Obama’s watch, and he appears remarkably oblivious to it. He may live to regret this oversight.

WASHINGTON — So much for the refrain about cutting spending. Lawmakers changed their tune on the military band budget.

By voice vote Wednesday, the Republican-controlled House restored $120 million for the armed services’ 100-plus military bands — money that budget-conscious members of the Appropriations Committee had cut last month. The quick vote came as Republicans and Democrats elsewhere on Capitol Hill clamored for significant spending cuts in negotiations with the White House on a deal to raise the borrowing limit.

Rep. John Carter, R-Texas, sponsor of the amendment to the $649 billion defense bill, said the cut to the band budget wouldn’t save taxpayers any money nor would it reduce the Pentagon budget.

“The facts about our bands are that they are an integral part of the patriotism that keeps our soldiers’ hearts beating fast,” Carter said.

Carter said the bands perform at funerals, USO events, concerts and welcome-home celebrations. He said the Army has 100 bands, Air Force 24, Navy 14 and the Marine Corps 14, and their numerous events “are all part of what makes our military the patriotic body that it is.”

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