Tuesday, March 16, 2010

A Solidarity Tax?

Just to get a grip on how tepid and worthless the Democrat Congress and Obama are, consider the following.


Right now, state governments across the country are facing major budget crises as a result of the economic downturn caused, crudely speaking, by bankers. Working people are being hit the hardest.

California is the eye of the storm, where there is a $42 billion deficit that grew out of a convergence of decades of regressive taxation, crashing financial and construction industries, and the bursting of the housing bubble.

Across the US, all 50 states are facing a combined $180 billion budget gap . What that means is that if they don't get that amount of money, they won't be able to maintain their (already inadequate, as the result of three decades of attacks from Democrats and Republicans alike) public services.

Teachers are being laid off, schools are being closed, public transit is being massacred, tuition is being hiked, public workers are being fired, patients are being thrown out on the street, libraries are being boarded up, infrastructure is rotting. There is mass unemployment all over the country, but the jobless rates for people of color are heart-stopping.


At present, the top marginal rate of taxation is 35%. President Reagan lowered it from 70% to 30% from 1980-83. George H.W. Bush raised it slightly, and Bill Clinton raised it a touch more so that it was 40% in 1993. And W. lowered it in 2001 to 35%.

The current holdings of wealth (not income) of the wealthiest 1 percent of Americans adds up to $21.9 trillion.

Just for the sake of argument, ignore the $1 trillion in military spending alotted for 2010.


Obama campaigned on the "radical" program of reinstating the pre-Bush Jr. tax rates (top marginal rate of 40%) for the rich in order to pay for more extensive public spending on health care. People turned out in droves to vote for him.

Now, I'm told that a small windfall tax on corporate profits or a one-time 3% tax on the wealth of the wealthiest 1% would more than double the amount of money that state governments have on hand right now.

Moreover, we can do a little mental math and quickly see that a, shall we say, "solidarity tax" that increased the top marginal rate of taxation by 5% would raise the money to stave off all cuts to public services, infrastructure and employment. An increase of 10% could even expand and shore up already anemic services in a time when more and more people are falling back on public services.

This is not even a radical proposal. It's simple math: we could slice and dice public services (education, healthcare, infrastructure, etc.) or we could simply raise the marginal tax rate on the very very wealthiest of the wealthy.

Yet voters are not asked to weigh in on these issues (except in Oregon, where they supported it).

Instead, they are asked to support one of two pro-business parties, both of whom are happy to eviscerate public goods and bow down to the wealthy and powerful.

It is the heavily Democratic Congress who are cutting public transit, slicing the social safety net, busting teachers unions, laying off public workers, raising tuition and closing schools. And before the much-hyped and overblown "Scott Brown Incident", don't forget that the supermajority-wielding Democrats couldn't even put together a stimulus bill that covered the state budget shortfalls since they were so keen on including tax breaks in the bill. And don't forget: Obama has proposed a freeze on discretionary spending (except for, of course, military spending).

I ask you: what is the purpose of supporting the Democratic Party? This is what they do when they wield the largest Congressional majorities I've seen in my lifetime.

What progressive and left-leaning people need to do right now is, first of all, completely divest from the Democratic Party and organizations subservient to it. The next goal has to be to build on (and forge new) movements already under way against budget cuts. If we ever hope to see important reforms like single-payer or fully-funded public transit in our lifetimes, we're going to have to form independent social movements to place demands on the existing order. Asking nicely and sending money to Moveon.org isn't a case of "not doing enough"; on the contrary, this kind of "activism" is precisely what's preventing meaningful change.

Can there be any doubt, even among liberals, that the function of the Democrats, intentionally or not, is to keep existing political arrangements intact?

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