Two issues among the
many the president raised really caught my ear. The first was an alternative
minimum tax for million/ billionaires so the rich (Romney, for example) have to
pay their fair share. Thanks to the sort-of Republican sort of front-runner
America has seen truly how it works for those among us with extreme wealth and
privilege. I hope Obama stays on this issue through the summer and fall. America
needs the education.
The second issue Obama raised that should be trumpeted is a minimum
corporate tax so that US corporations cannot shift their income to foreign
subsidiaries that claim income outside the US, and expenses here in the US.
This type of fiscal slight of hand is very easy to do. The complexity of the
tax code and the financial shell game that has been invented to exploit it have
exacerbated the flight of capital and as importantly jobs to distant shores. The
result is corporations like GE with $5.0 billion in profits in 2010 paying little
in corporate taxes even though the rate for corporate profit is set at 35%.
Another company, Exxon with $3.2 billion in profit in 2010, claims to have paid
$2.6 billion in taxes that year, but obfuscates by including state and local
taxes which it merely collects, but does not actually pay, and payroll taxes
which as every small business person knows has nothing to do with the corporate
tax on profits.
If it all sounds confusing that’s the goal. Tax policy has
gotten not only less progressive, in that collections are increasingly weighted
to the middle class, but also eternally more opaque and complicated. Business interests and private citizens have with
large capital campaign expenditures skewed the tax code to their benefit. The
middle isn’t just getting squeezed, they’re getting screwed and they know it.
Neither of Obama’s tax proposals will pass this year, and
without a dramatic swing in congress maybe not next year, but this goes to the
core of the fairness issue, and the principle that all segments and members of
society contribute and pay taxes to support the government according to their ability
to do so. Much has been made of how the top 1% pays a disproportionate share of
the overall income tax, but little has been noted about the wildly
disproportionate share of the nation’s wealth concentrated in these very same
hands. The six Walton heirs for example control as much wealth as 100 million
Americans. We could call these people “those at the bottom”—but when those at
the bottom are 1/3 of the American population that label doesn’t seem a
particularly good fit.
I was buoyed recently when I caught a snippet of recently
released tapes from JFK in which he is heard saying, “…the prosperous hate us…”
So it goes and it always has, the battle between the haves and the have nots to
control the levers of power. However, it
seems only fair to point out how we arrived at this place in our history. Big
money contributes substantial sums to conservative causes and candidates that
speak their language. Socially conservative voters, dutifully reinforced in their
rage, enter the polling stations and support candidates who as a first order of
their legislative agenda vote for the whole panoply of fiscal issues that the
rich really desire: Lower taxes, less regulations, weaker government oversight,
etc. Of course these fiscal policies do
not advance causes that help the poor and middle class from whose ranks the
socially conservative, religious right, and Tea Party rise. But the rich with
their available and now completely unregulated campaign contributions make up
the narrow sliver of the country that the Republicans are truly defending as
they run. The enduring element is that
taxes for the rich and connected are kept low.
The cumulative effect of the last 30 years has been the
economic collapse of 2007/2008, sky high deficits that reign in the
government’s ability to do almost anything, and a tax policy so skewed to the
well to do that it has led to a disparity in wealth between the top and the
bottom that the country has never seen. In our gridlocked country the cost of government
grows, deficits balloon, and education, infrastructure and other needs of the
nation are slimly or poorly met.
Democrats, influenced by big-money Wall Street interests who
support them at astounding levels are also responsible. As most Americans now
know, big money is an equal opportunity corruptor. Clinton after all repealed Glass-Steagall
which prevented the banks from betting their depositor’s money on Wall Street.
The Dodd-Frank Bill Obama signed did not erect nearly as firm a firewall, and
as everyone knows the six banks left after the too-big-to-fail crisis of 2008
replaced a dozen or more which existed before.
In addition to the decimation of the real estate markets in
Florida, Arizona, and Nevada, and really across the country Romney’s tax bill
is exhibit A in an examination of the results of the policies that have been
enacted roughly going back to the Reagan years. Considering the hard choices about
education, infrastructure & housing, and medical care and retirement
America needs to make, 15% taxation at Romney’s level of income is obscene as are
the miniscule tax bills for Exxon and GE.
Americans get the inequity at a visceral level. In 2008 and
2009 the country was in shock over its financial demise. The average person
lost about 1/3 of the value of their 401K. Housing prices were and are down by about
the same amount, much more in speculative hot spots like Florida and Nevada. Anger
developed on both sides of the political spectrum quickly as a response to it. As with the student unrest in 1968 the US is
not alone. Governments around the world are seeing people in the streets.
Everyone knows that something has been crapped up. The right
assumes that big government is the cause. The Tea Party had elements that came out
simply in response to the election of a black President, but it was initially
organized around the issue of the bailouts to the big financial firms and the
succeeding stimulus bills under Bush and Obama. The anger, especially
initially, was directed at establishment Republicans as well as Democrats. This
is one of the reasons the Republicans in the house are so hemmed in now from
moving any legislation. Many in leadership are afraid of the Tea Party which is
ironically the source of their power. The bailouts were largely seen by TP
Republicans as a wasteful giveaway to entrenched financial interests. On the left the Occupy movements also casts
shadows of doubt on both parties, as well as institutions of business and finance.
Neither party has effectively harnessed the deep misgivings
that people have with the direction the country has gone. The anger so many
people about the massive inequities in the society and as importantly and maybe
more so their general belief that the game is fixed have been responded to
ineffectively by both parties, which only further feeds the anger and
resentment among the electorate. The polarization and paralysis in Congress, a
direct result of the way money has distorted the process, only intensifies that
anger. Majorities of 60% and more can agree on raising taxes on the super
wealthy in order to pay for programs to benefit the unemployed and yet nothing gets
done. Billions are spent every election cycle now to make sure the dial never moves
far. Lobbying accounts for billions more.
As a liberal I have enjoyed the vicious ugly family
squabbles we have seen among the Republican candidates and the wild and
immature way the conservative electorate has responded to it, with each new
candidate at the dance being treated as prettier than the last. But I hold
little illusion that if the Democrats were the party out of power, their race
for the nomination would look similarly raging and confused. People are pissed
off and have yet to find an effective vehicle for their anger, but with so much
around it has slopped over into all of the available and various buckets.
So what is there to unify America? Well, I truly don’t know. At the moment the
distance from the American dream seems far away for a lot of Americans and the
vaguely held understanding that the game has been fixed to make the attainment
of it nigh on impossible is firmly entrenched.
Is Obama the answer for all that ails us? I doubt it. Even with his
fairly moderate policies, he has been painted as a crypto fascist socialist
raving eyed nut by many on the right. The rhetoric, while have some historical precedent,
is nonetheless stunning. In the last week we have seen stories of elected
leaders calling on others to pray for his death. There is just so much blind
rage in the country it really is a dangerous time. Fascist and Neo-Fascist movements have germinated
in the past from similar circumstances.
In both parties, most cannot hear the opposition over the
sounds over their own constituencies. So perhaps we can hope for little new
enlightenment or accomplishment this election cycle. Let us at least hope for
this: The situation does not become worse. We can vote to elect a president who
at least will continue the dialogue about the inequity in our society, however
feeble his efforts in addressing them. Or we can elect a candidate from the other
party who no matter their private thoughts will not even acknowledge the catastrophic
circumstances of late 2008 and 2009 or the dire need for action which preceded this
president. Whomever the Republicans nominate they will be politically, if not
morally and personally committed to policies to the right of what we have seen.
For me I have no doubt.
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