Monday, December 6, 2010
All Out War
It's impolite to admit it, but we're at war. I'm not talking about Iraq, Afghanistan, or even Pakistan or Yemen. I'm talking about at war with ourselves. We have a domestic battle going on. And again, I'm not talking about red states versus blue states or the intellectual elites versus the mama grizzlies. I'm talking about class warfare.
Conservatives call it "redistribution of wealth", and they're right. There's an effort by liberals in this country to redistribute the wealth. There's a reason for this. A sound reason. For the past 30 years the wealth has been redistributed in the opposite direction.
Senator Bernie Sanders (I-VT) in this youtube video from the Senate floor, lays out the facts of this case in much more clear terms than I can hope to recreate here so I'll let the gentleman from Vermont stand on his own.
Highlights (I'd argue they are lowlights):
- In 2007, the top 1% of Americans earned 23.5% of all income in the United States, up from just 8% in mid-1970s.
- This top 1% earned more than the bottom 50% of all Americans combined.
- The top o.1% (1/1oth of 1%) earns 12¢ of every dollar made in the United States.
- Between 1980 and 2005, 80% of all new income went to the top 1%. That leaves 20% for the remaining 99%.
- Wall Street executives largely responsible for the financial crisis are now earning more than they made before the bailout.
- We have the most unequal distribution of income and wealth of any developed country on earth.
- Some in Congress have come out in support of $700B in income tax breaks over the next 10 years to the top 2% of earners. This would result in an average $100,000 tax break to each person in the top 2%.
- Eliminating the estate tax would cost $1T over the next 10 years and that break would go virtually entirely to the top 3/10th of 1%.
- Our trade policy has resulted in the loss of millions of jobs earning livable wages in exchange for cheap goods overseas and higher corporate profits.
- In 2009 ExxonMobil made $19B in profits, paid $0 in taxes, and received a $156M refund from the IRS.
All of these are verifiable facts. Not opinions.
So at a time when our economy is in distress, we have sustained high unemployment, our federal budget deficit is growing daily through a combination of increased outlays to help the poor and unemployed and decreased tax revenue, a substantial number of our leaders think it is sound policy to extend tax breaks to the top 2% of earners and eliminate the estate tax altogether, providing a $1.7T windfall to these highest earners over the next 10 years.
So we're clear, the extension of tax breaks to the wealthy represents just a 2.8% increase in their top marginal tax rate. This means they pay the same as everyone else on all taxes in all lower brackets. Only once they exceed $200,000 in taxable income as an individual or $250,000 as a couple do they pay an additional 2.8% of their income over those thresholds in taxes. The GOP is claiming this is necessary to create economic growth. These tax breaks have been in place for nearly 10 years. Where's the growth? It's a myth. It's a fiction. It doesn't work. We need the tax revenue to cover expenditures for the poor, the elderly, and the infirm.
This is part and parcel to an assault on the working and middle classes by the moneyed elite in this country. It began under Ronald Reagan and it has continued under every president since, Republican and Democrat alike. Only now, under President Obama, has there been any pushback whatsoever against this systematic financial rape of the American people, and the resulting hue and cry from the wealthy and their shills has been shouts of "Socialism!", "Communism!", "It's a war. Like when Hitler invaded Poland in 1939!" All this when President Obama's policies and the Democrat-controlled Congress have been largely business friendly. His Justice Department has not pressed charges against a single Wall Street executive for defrauding investors. The financial reform law falls far short of what is likely necessary to avoid future bubble/burst cycles. The health care reform law does not actually capitate expenditures for healthcare.
It's clear why this state of affairs exists. These moneyed interests own Congress. Their campaign contributions and political action committees trade treasure for power. Politicians who dare to stand up to these forces do so at their own peril. Wall Street, which had backed President Obama overwhelmingly in the 2008 election, poured their millions into Republican coffers in 2010. Apparently the president was too critical of their excesses and their payback was to support his opponents. No matter who wins the elections, the American public, at least the 98% or 99% of us who don't hold the purse strings, lose.
You'll find this is a common topic for me to discuss. I've hesitated to call it war for a long time, but that's where we are. We have a choice. We can either continue to accept the status quo or we can stand up for egalitarian principles in which our interests are given equal weight to those with loads of cash.