GOP trifecta of inequality: increase deficit, cut programs & raise middle class taxes to fund tax cut for wealthy

By Marc Jampole

Imagine stand-up comic Henny Youngman, king of the one-liners, describing the Trump GOP tax proposals with one of his classic bits:

 So how big is the tax break for the wealthy in the new tax bill?

Why it’s so big that raising the deficit by trillions of dollars won’t cover it…

Why it’s so big that raising taxes on the middle class won’t cover it…

Why it’s so big that gutting Medicare, Medicaid, the State Department and other government programs won’t cover it…

That’s right folks, the Republicans have hit the trifecta of inequality. Raising taxes on the middle class, increasing the deficit and gutting important programs that help every American so that the wealthy can get another tax break. Each represents a wealth exchange in which the ultra-rich get richer and someone else gets poorer. Any of these three wealth exchanges would in and of itself injure the economy while creating greater inequality of wealth. Making all three is likely to send the country into a deep recession or a real depression.

The Trump GOP plans are perfectly crafted to offend all democratic principles: The richer the person, the bigger the tax break. The larger the corporation, the bigger the tax break. The more someone’s wealth is in capital such as financial assets and real estate—as opposed to salary—the bigger the tax break.

The GOP says that when you lower taxes, rich folk and corporations invest in creating more jobs and in paying better salaries. That’s not what history says. History tells us that rich folk pocket the money and then invest it in the secondary stock market (meaning it doesn’t help the company whose stock you bought although it helps the senior executives with lots of stock options; the company only benefits from the initial sale of the stock); buy government bonds to fund the deficit that their tax break created; and dump it into other assets like fine art, yachts, apartments in Manhattan and beach front properties. Meanwhile, money will have been taken out of the economy, as all the spending done by laid off government workers, recipients of government aid and the middle class before tax hikes will be gone. Within a few years of passage of either the House or the Senate version of “The Great Heist of 2017,” a new asset bubble will form then burst after which the economy will go into a rapid tailspin. Just like 1929, 1987 and 2008.

The wealthy pay historically low rates on their income in the United States, even after two mild tax increases during the Obama years. In the 1950’s, when the economy mostly boomed and there was less inequality of wealth than at any other time in American history, rich folk paid 91% of incremental income in federal income tax. Remember that means that they only paid 91% on the income over a certain amount, maybe a million dollars, truly a lot of money in those days. With all progressive income tax systems, everyone pays the same amount within income levels. The top rate always applies only to income above that limit. Everyone pays the lowest rate on their income up to that limit.

Studies by Thomas Piketty and others have established that the economy actually grows when we raise taxes on the wealthy—that is, until we raise them too much and it begins really to cut into spending and investment in job growth. And what’s the point when raising taxes on high tax brackets begins to hurt the economy? Piketty computed it to be a taxation rate of 70%, or roughly twice what the current maximum tax on income is.

In other words, instead of decreasing taxes on the wealthy, Congress should be raising them—and then investing the money in the kind of things that we did with our tax money in the 1950’s and 1960’s: pure scientific research, infrastructure improvement (focusing more on mass transit and less on roads and airports this time), public school and university education, energy development (solar and wind instead of nuclear), healthcare and helping the disadvantaged.

Many of the Republicans know that, if passed, their tax bill will sink the economy and increase inequality of wealth in the United States. Most don’t care because they serve as mere factotums to the ultra-wealthy who finance their campaigns and provide them with cushy sinecures after they retire from elected office. Today Republican candidates and elected officials—and many Democrats, too–count dollars not votes and represent a narrow constituency consisting of a handful of selfish multi-billionaires.

FCC enables more media consolidation. The result will be less real news.

By Marc Jampole

We typically blame the decline of the news media in the 21st century on one of two factors: the growth of the Internet as a 24/7 source of news and the proliferation of fake and false news.

But given much less attention is the consolidation of news media and news-gathering operations. It used to be that the federal government had strict regulations about the number of radio and television stations any company could own and forbade ownership of both newspapers and broadcast stations in the same town. Even when single newspapers came to dominate many towns, there were typically many different organizations searching for and presenting the local and national news. A series of laws and new regulations over the past 35 years—aka the Reagan Era—has consolidated media ownership.

The key law was the Telecommunications Act of 1996, which enabled companies to own more stations. Larger companies bought smaller ones and suddenly instead of hundreds of owners of TV and radio stations across the country, there were only dozens.  We saw the impact on radio as Clear Channel, and recently Sinclair Broadcasting, and other companies owned by right-wingers gained control of the editorial policies of more and more stations.  Pretty soon the range of opinion on radio narrowed and moved extremely right. While Rush Limbaugh began making a name for himself before 1996, it was the consolidation of media ownership that led to the domination of talk radio by Rush and his clones—Sean Hannity, Laura Ingraham, Michael Medved, ad nauseum.

Last week, the Federal Communications Commission (FCC) took a major step in making the problem worse by voting to allow a single company to own both print and broadcast media in the same town. The FCC also voted to increase the number of TV stations one company can own in any given market. It was a close vote, 3-2, on party lines. Don’t be embarrassed if OpEdge is the first you’ve heard of this awful decision. It received very little coverage; the New York Times buried the news on page two of the business section.

The Obama Administration FCC also announced its intentions to end the restriction on ownership of both print and broadcast media in 2011, but eventually backed down. This time, under its brand new Trump-blessed FCC chairman, Ajit Pai, an Obama appointee to the FCC known for his pro-broadcasting industry views, the FCC has made good on the threat.

The rationales today and in 2017 are similar: That local media needs to consolidate to be able to compete against the giants of Facebook and Google. Pai, for example, has argued that local media companies would have a better chance to compete against Internet behemoths by combining local market resources.

The argument is completely specious for two reasons. First of all, most broadcast stations and daily/weekly newspapers are already owned by large chains. It’s not the case that the various media in Cincinnati will join forces to do one great job on local news. Instead, one national giant that also controls Toledo, Ohio, Syracuse, New York and four dozen other localities will end up owning all the media in Cincinnati. The new rule will surely lead to ever greater concentration of media outlets in the hands of fewer companies.

The second problem with Pai’s argument is the confusion of news-gathering with news media. Despite the alarming decrease in the number of daily newspapers over the past few decades, the number of absolute media outlets has increased: Internet news sites, cable news and specialty weekly and monthly pubs have more than made up for the decline in newspapers.

The problem is that while media outlets have increased, news-gathering on both the local and national level has decreased, as recent studies by the Pew Foundation and the FCC . And consolidation of media outlets is a major cause. When a company buys more than one newspaper, it can use the same news-gathering staff for all the news, except for the news that pertains to each newspaper’s particular readership, something most often defined by locality. All the newspapers in the Gannet or Tribune chains get the same national and international news and columnists. But each local paper has to find its own local news, typically in competition with the three or four local TV stations, the local business paper and the local alternative weekly.

Now that a single company is allowed to own all of these local properties, the company will be stronger, but primarily because it is able to cut costs through using the same news room to cover stories. The impact on overall news production will be horrific: Instead or more editorial boards deciding what is newsworthy, one will. Instead of three or more points of view on a story, there will be only one. Instead of three or more sets of reporters trying to dig deeper, only one will—that is, on those stories that the editors and business sides decide is worthy of delving. Instead of three or more sets of opinions on local issues, only one. Finally, instead of three or more organizations with ties to differing networks of national and international news gathering, there will be but one. The result will be less reporting.

Instead of actual reporting, what we’ll see once large media companies start buying up local properties is more of the same filler that has been replacing real news for the past 15 years or so, including more opinion pieces like this blog; more coverage of celebrities and sports; more repackaged how-to’s and advice columns; more part-and-parcel use of news release, fact sheets and “articles” produced by the government, rightwing think tanks, large companies and public relations firms; and more “sponsored” news reports, which are advertisements pretending to be news.

If the FCC and the current administration really cared about freedom of the press and creating a stronger marketplace of ideas, instead of allowing companies to buy more media properties, it would implement regulations and put pressure on Congressional leaders to break up the media industry oligarchy and stop the pilfering of free content that occurs on Facebook and Google News that denies news-producing media outlets needed revenues. Unfortunately, it would take Congressional action to do most of what I’m recommending:

• Limit ownership of media properties to a total of 10 properties, including television and radio stations, newspapers, news magazines, cable networks and websites, and push for expedited divestiture by the current media giants.
• Prohibit companies from owning more than three cable networks, and make all cable networks provide at least two hours of news coverage a day.
• Prohibit companies owning ISPs from also owning media outlets.
• Reinstitute the Fairness Doctrine, which used to make every broadcast television and radio outlet to devote some airtime to discussing controversial matters of public interest and to air contrasting views regarding those matters. The Fairness Doctrine was the law of the land from 1949 until 1987, when the Reagan FCC voted to end it.
• Allocate billions of dollars in aid to nonprofit or small for-profit media outlets to produce original reporting and fund it at least partially by taxing social media services and Internet service providers (ISPs) like Spectrum and FIOS for their “free use” of news.
• Legalize strict principles of journalistic ethics and start to prosecute journalists and media company executives for knowingly disseminating fake and false news. I propose to walk a fine line between censorship and responsible reporting. But by focusing exclusively on the reporting of facts and not the spouting of opinions, I think we can protect true freedom of the press.

I am not very optimistic about any of my recommendations being pursued by either a Republican or Democratic administration and Congress. Politicians of both parties have cozy relationships with the mainstream news media and conservative ones seem not to mind that so much in the rightwing media is false or fake news. Thus we face an ironic future in which there are many ways to access the same limited and somewhat flawed set of facts and conjectures about current events, society and government activity.

We like to conceive of history as a steady progress of human ingenuity solving problems and bringing an ever higher standard and quality of life to more and more people. But our 10,000 years of recorded history has seen many eras in which people were far worse off economically than the decades and centuries before, for example, during the 300 year transition from medieval times to the industrial revolution during which the world experienced the “Little Ice Age.”

In the same way, we have not seen steady progress in the spread of knowledge. After the death of Charlemagne, for example, Europe entered a centuries-long epoch in which scientific knowledge and literacy declined and intellectual activity retreated into monasteries.

It seems to me that America is are entering another intellectual dark age, in which people in general will know less, be able to reason less effectively and have less access to the gamut of human knowledge, from science to the arts. It’s not just the consolidation of the media and the decline in the number of news-gathering operations that is driving the drift towards ignorance. The large number of ideologically inclined think tanks churning out false research. The gradual starving of public schools. The increased involvement of for-profit corporations both in operating schools and in supplying material such as learning guides to public and private schools. The blurring of the distinction between the entertainment and news divisions of media companies and between advertising and news. The politicization of text books. The denial of basic scientific facts by one of our two major parties. The continued glorification of celebrity and mocking of intellectual achievement in the mass media. Virtually every trend in the marketplace of ideas is making Americans less educated, less informed and less capable of sifting through assertions and understanding which are reliably factual information and which are sheer nonsense.

Editorial: Resistance Strikes Back

It’s been a long year since Russian Internet trolls and Republican voter suppression tactics combined to deliver the White House to Donald Trump. Voters on Nov. 7 finally got the chance to express their outrage at the trail of lies, mindless tweets and broken promises left by the Grifter in Chief.

It wasn’t much of a surprise that Democrats would win back the governor’s office in New Jersey, after outgoing Gov. Chris Christie (R), who once had presidential ambitions, bottomed out with a 15% approval rating. Being Christie’s lieutenant governor didn’t help Kim Guadagno, as Democrat Phil Murphy won with 55.6% of the vote.

The most widely watched race was in Virginia, where Dems should have expected an advantage since the outgoing governor is a Democrat and Hillary Clinton won the state by 5.3 points in 2016.

But Republican nominee Ed Gillespie adopted Trump campaign themes such as appeals to white supremacism, neo-Confederates, immigrant bashers and climate science deniers and, in the weeks before the election, polls showed Gillespie running neck and neck with Democrat Ralph Northam.

When the votes were counted on Nov. 7, not only did Northam beat Gillespie by nine points, but exit polls showed twice as many voters (34%) said they cast their ballots to express opposition to Trump, as the 17% who voted to express support for Trump.

Women, young people and minority voters provided the margin of victory for Northam. Men were 51% of voters and favored Gillespie by two points, but that’s down from Trump’s nine-point edge among men last year. And women favored Northam by 22 points, up from Clinton’s 17-point advantage last year. Gillespie won white voters by 15 points, but that was down from Trump’s 24-point advantage last year, while black voters, 20% of Virginia’s electorate, went 87% for Northam. The vote was still polarized by geography, as cities and D.C. suburbs supported Northam while almost two-thirds of voters in the mountainous and western parts of the state supported Gillespie.

Democrats also won the two other statewide elections in Virginia — for lieutenant governor and attorney general, and they picked up at least 15 seats in the state House of Delegates, which Republicans had ruled with a 66-34 majority that was now cut down to a one-vote majority, with recounts in three districts that could flip the House to the Dems. Eleven of the Democratic winners were women, including the first Asian American, two Latinas and transgender Danica Roem, who beat the chamber’s self-proclaimed leading homophobe, Bob Marshall, by focusing on better roads in the district.

The downside of the election is that Virginia voted by a margin of nearly nine points for Democrats but still fell short of a legislative majority because of gerrymandered district lines. Democrats will face similar obstacles in trying to turn around Republican majorities in Congress and other state legislatures next year. Democrats need to flip 24 seats now held by Republicans to regain the majority in Congress, but Nick Stephanopoulos, an expert on gerrymandering, told the New York Times Democrats, could get 54% of the national House vote and still see the Republican maintain control.

In the Senate, Republicans have a two-vote majority, and that majority may be reduced if Alabamans decide on Dec. 12 they would rather not send accused child molester Roy Moore to the Senate. (Many evangelical “Christians” say the accusation that Moore molested a 14-year-old girl 38 years ago is no major bar to service if the alternative is a Democrat such as Doug Jones, former federal prosecutor of the KKK.)

Next year, Democrats will be defending 23 Senate seats, along with two independents allied with the Dems, while Republicans have only eight seats up for election. Democrats hope to gain the Arizona seat Jeff Flake is giving up, as well as the Nevada seat Dean Heller holds. Longshots are Ted Cruz’s seat in Texas and the Tennessee seat Bob Corker is giving up, but Dems also have to defend Sens. Bill Nelson in Florida, Joe Donnelly in Indiana, Claire McCaskill in Missouri, Jon Tester in Montana, Heidi Heitkamp in North Dakota, Sherrod Brown in Ohio, Bob Casey in Pennsylvania, Joe Manchin in West Virginia and Tammy Baldwin in Wisconsin.

Unfortunately, the main lesson Republicans probably will draw from the recent election is that voter suppression has not gone far enough. Vice President Mike Pence and Kansas Secretary of State Kris Kobach are helming a special presidential task force to develop new methods of keeping Democrats from voting or preventing the counting of their votes.

It’s been frustrating, as editor of The Progressive Populist, to listen to Trump being described as a populist who would protect American workers and “drain the swamps” in Washington. Populists believe that people are more important than corporations, and the government needs to be strong enough to keep corporations in line. Trump has always been a grifter with authoritarian leanings and a history of stiffing contractors, fighting unions and looking out for No. 1. But it’s getting easier to show Trump is a charlatan as he has packed his administration with half a dozen former executives of Goldman Sachs as well as pro-corporate administrators at federal agencies to prevent health and human services, environmental protection, public schools, federal lands and fair labor and housing standards. And Trump on Nov. 13 named Alex Azar, a former pharmaceutical executive who has repeatedly opposed measures to restrain drug company profiteering, to succeed Tom Price as secretary of Health and Human Services.

The Resistance has organized largely on the Internet, with the progressive press helping to identify the targets. The coalition and Dems in Congress have racked up a pretty good record in the first year, knocking down attempts to repeal the Affordable Care Act, a.k.a. Obamacare, and fighting Trump and the GOP Congress to a virtual standstill on the worst of the bad bills so far. But the billionaires have told their Republican Congresscritters they’d better get a big tax cut or they’ll cut off funding for campaigns, so Republicans came back with a 2018 budget that would cut $1.5 trillion from health care spending, including $1 trillion from Medicare and $473 billion from Medicare, to set up those tax cuts, regardless of Trump’s campaign promises to protect those health programs. And we’ll see what House Speaker Paul Ryan has in store for Social Security.

Plutocrats have been working for more than 80 years to overturn the New Deal’s reforms that regulated capitalism and enabled the recovery from the Great Depression. In the 1980s Ronald Reagan provided the opportunity for the plutocrats, as they broke the unions that provided major backing for the Democrats; the National Labor Relations Board backed the unionbusters; and Reagan’s Federal Communications Commission killed the Fairness Doctrine, which since the end of World War II had required broadcasters to provide balanced coverage of controversial issues of public importance to prevent fascists from rising in the US. The demise of the Fairness Doctrine in 1987 allowed conservative broadcasters to consolidate control of the airwaves, with few opportunities for liberal and progressive voices. Now Trump’s FCC is moving to give corporations control of the Internet, and put more toll booths on the information superhighway, while Trump and other right wingers have worked to undermine the credibility of critical news media as “fake news.” Lately he has called for licensing journalists, taking another page from the fascist playbook of the 1930s.

The Grand Oligarch Party will keep coming with bad ideas, the money to promote them in the corporate media and financial backing for politicians who will do their bidding — and they don’t play fair. The Progressive Populist will try to restore the good name of populism. The Resistance will have to keep fighting back by getting the word out whichever way they can. But it was a good first year. — JMC

From The Progressive Populist, December 1, 2017

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Selections from the December 1, 2017 issue

COVER/Lucian K. Truscott IV
You don’t cut taxes with two wars and 240,000 troops overseas

EDITORIAL
The Resistance strikes back

LETTERS TO THE EDITOR

DON ROLLINS
Young Evangelicals blurring theological lines

RURAL ROUTES/Margot McMillen
Food for thought: Why not thought for food?

DISPATCHES
McConnell concedes GOP tax plan will increase taxes on many;
GOP tax plan is all unicorns;
Landmine in GOP tax bill would give fetuses personhood;
GOP plan raises tax on graduate students;
Obamacare grows despite Trump’s sabotage;
Maine voters opt for Medicaid expansion;
GOP ready to push Trump judicial choices through;
Dems win with serious, affirmative agenda;
Big Oil loses big in Washington State ...

ART CULLEN
Rural despair

JILL RICHARDSON
Gun control shouldn’t be this hard 

BOB BURNETT
Trump’s tax cut challenge

SAM PIZZIGATI
If you want to collect Social Security, Trump’s tax plan is an outrage

OLIVIA ALPERSTEIN
What real tax reform could look like

RICHARD ESKOW
Dems want to ditch leaders and move left; they’re right

GRASSROOTS/Hank Kalet
Forests and trees

BARRY FRIEDMAN
American voices: The Resistance, year one

MARK ANDERSON
Is a groundwater ‘trade deficit’ gurgling under our feet?

HEALTH CARE/Joan Retsinas
Emergency rooms as Realtors: A micro point of light on the healthcare horizon

SAM URETSKY
It’s never too early to discuss public safety

WAYNE O’LEARY
That Kennedy tax cut

JOHN BUELL
President Trump: Nuclear business as usual?

JOEL D. JOSEPH
Robots create made in the USA jobs

BOOK REVIEW/Seth Sandronsky
Sports safety advocacy

BOOK REVIEW/Heather Seggel
Questions before the Resistance

ROB PATTERSON
Royal flush

SATIRE/Rosie Sorenson
A tale of three Harveys

MOVIES/Ed Rampell
Stars, survivors, relatives, remember Hollywood blacklist’s 70th anniversary