Friday, January 11, 2019

Editorial: AOC’s Modest Proposal

New Rep. Alexandria Ocasio-Cortez (D-N.Y.) has been living rent-free in the heads of right-wing pundits ever since the Democratic socialist former bartender from the Bronx gained notoriety with her upset win over liberal 20-year incumbent Rep. Joe Crowley in the June 26 Democratic primary. But the right wingers really flipped their wigs when she suggested, during a 60 Minutes interview, that the top marginal tax rate be increased to as much as 70% to finance initiatives such as the “Green New Deal” she is proposing to get a handle on climate change.

The ensuing hubbub showed that some prominent “conservatives” either don’t understand how marginal tax rates work, or they were being intentionally dishonest about it, Aaron Rupar noted at Vox.

After a preview of the interview was released Jan. 4, Rep. Steve Scalise (R-La.), tweeted that Ocasio-Cortez’s tax proposal would result in government seizing “70% of your income and [giving] it to leftist fantasy programs.”

A few hours later, Grover Norquist, head of the Americans for Tax Reform, claimed in a tweet that Ocasio-Cortez “wants 70%” of “your production,” and suggested her proposal is akin to slavery. “It’s hard to believe that Norquist, who has dedicated his professional life to tax policy, doesn’t understand how marginal tax rates work, but he is nonetheless misrepresenting it on Twitter,” Rupar wrote.

Conservatives have attacked AOC for allegedly not being well-versed in policy details, but Rupar noted she succinctly and accurately described how progressive marginal tax rates work while discussing her proposal.

“Once you get to the tippy-tops, on your $10 millionth dollar, sometimes you see tax rates as high as 60% or 70%,” she said. “That doesn’t mean all $10 million dollars are taxed at an extremely high rate. But it means that as you climb up this ladder, you should be contributing more.”

Under the current marginal tax rates, the first $9,525 earned by a single filer is taxed at 10%. Income from $9,525 to $38,700 is taxed at 12%. Income from $38,700 to $82,500 is taxed at 22%. The brackets go up to the top rate of 37%, which for a single filer kicks in at $500,000 ($600,000 for a married couple filing jointly).

Paul Krugman, the Nobel Prize-winning economist, in a New York Times column Jan. 5 noted that AOC is advocating a tax rate of 70% on very high incomes, “which is obviously crazy, right? I mean, who thinks that makes sense? Only ignorant people like … um, Peter Diamond, Nobel laureate in economics and arguably the world’s leading expert on public finance. … And it’s a policy nobody has ever implemented, aside from … the United States, for 35 years after World War II — including the most successful period of economic growth in our history.

“To be more specific, Diamond, in work with Emmanuel Saez — one of our leading experts on inequality — estimated the optimal top tax rate to be 73%. Some put it higher: Christina Romer, top macroeconomist and former head of President Obama’s Council of Economic Advisers, estimates it at more than 80%.

Krugman noted that when America had very high rates on the rich (as high as 92%) after World War II, the economy did just fine. Since then tax rates have come way down, and if anything the economy has done less well.

“Why do Republicans adhere to a tax theory that has no support from nonpartisan economists and is refuted by all available data? Well, ask who benefits from low taxes on the rich, and it’s obvious,” Krugman wrote.

In 2017, the Economic Policy Institute reported that CEOs at the 350 largest companies in 2016 took home an average of $15.6 million — 271 times what the typical US worker earns. That was up from a ratio of 30:1 before the Reagan-era tax cuts. When Ronald Reagan left office in 1989, CEO compensation averaged 59 times the typical earner. The increasing use of stock options to inflate executive compensation packages has exploded that CEO-to-worker pay ratio since then.

AOC proposed that the top marginal rate of 70% be applied to incomes over $10 million, but that allows a generous ratio of executive compensation at 321 times the median personal income, which was $31,099 in 2017. We would propose that any compensation more than 30 times the median personal income, which would be approximately $932,000, should be taxed at 70%. That would give executives an incentive not only to reinvest earnings in their company, but also to pay their workers more, so they’d get that median income — and the top marginal tax benchmark — up.

After getting the government opened up, the first bill the Democrats hope to pass is a sweeping anti-corruption bill aimed at stamping out the influence of money in politics and expanding voting rights. HR 1 has no chance in the Senate, where Majority Leader Mitch McConnell has already said, “That’s not going to go anywhere,” possibly because Republicans know they can’t win a fair election any more.

AOC and her progressive allies might not get much of their initiatives past the Republican-dominated Senate, but if the progressive coalition can pass some of these bills out of the House, with the cooperation of new Speaker Nancy Pelosi and the Democratic leadership, they can show voters what might be possible if they return Democrats to a Senate Majority and the White House in 2021.


Deadbeat Don Holds Workers Hostage

Another reason why we should not run government like a business was on display during the federal government shutdown. It was no surprise that Donald Trump, who has been a grifter and a deadbeat all his life, sees nothing wrong with leaving nearly five million workers without paychecks for an indefinite period of time.

Trump, who routinely stiffed contractors on his real estate projects, forcing them to sue him to get their payments, has suggested that the shutdown could result in a net savings for the federal government, which shows his misunderstanding of how the government works.

First, most of the federal employees will eventually get their back pay when the impasse is resolved. About 420,000 of the federal workers are classified as essential and are working without knowing when they’ll be paid. About 380,000 federal employees have been furloughed and probably will get back pay when the shutdown is resolved. And they’re not all highly-paid bureaucrats. J. David Cox Sr., president of the American Federation of Government Employees, which represents about 40,000 Bureau of Prisons employees who have been furloughed in the shutdown, told the New York Times his members get an average take-home pay of $500 a week, which leaves little cushion during a shortfall.

Also, an estimated 4.1 million people work for federal contractors, according to Paul Light, a professor of public service at New York University. The contract workers clean offices, serve food and provide security or other services for federal agencies, and they are not expected to receive back pay when the deal is worked out.

In the past, Trump’s father bailed him out of financial trouble until the debts got too great, as Donald managed to lose money on three casinos in Atlantic City as well as the Plaza Hotel in New York City, taking them through bankruptcy a total of six times. Trump said there was nothing wrong with using bankruptcy to handle debts, and insisted he had “used, brilliantly, the laws of the country.” But that’s why he had to turn to Russian oligarchs and Mideastern potentates to finance recent ventures — and now he is desperate to distract the public from the fact that he’s in over his head.

Tell your senators to put the government back to work. — JMC



From The Progressive Populist, February 1, 2019

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Copyright © 2018 The Progressive PopulistPO Box 819, Manchaca TX 78652

Selections from the February 1, 2019 issue

COVER/Jim Goodman
Dairy farming as we knew it is dying. After 40 years, I’m done.


EDITORIAL
AOC’s modest proposal; Deadbeat Don


LETTERS TO THE EDITOR 

DON ROLLINS
Divesting in Trumpism


RURAL ROUTES/Margot McMillen
Let the presidential candidates show they can help


DISPATCHES
Mainstream media blows coverage of Warren’s DNA test.
Maine’s new governor gives health care to 70,000 on first day.
US-Mexico treaty shows Trump border wall absurd, also illegal.
Only six on terror list stopped at southern border in first half of 2018, and more immigrants are leaving than coming in.
Trump's trade war costs middle-class families hundreds of dollars this year.
Trump in ‘no hurry’ to get Senate-confirmed Cabinet secretaries.
Trump tops 7,645 lies in December.
Supreme Court clears the way for Mass. A.G. to pursue ExxonMobil.
Don't mess with AOC ...


ART CULLEN
Our role in Democracy


JOHN YOUNG
Trump nation can’t see out its own windows


JILL RICHARDSON
New Year’s affirmations


ANTHONY PAHNKE
The Farm Bill should be better


JIM VAN DER POL
Reaching across the aisle isn’t working for the people


GRASSROOTS/Hank Kalet
Time to leave the war zone


JAMES A. HAUGHT  
Evangelicals vote, ‘nones’ falter

MARK ANDERSON
Beekeepers seek to save the buzz


SETH SANDRONSKY
Amazon and cross-border solidarity


HEALTH CARE/Joan Retsinas
From genetics to the media: In praise of sunshine


SAM URETSKY
Not all cities get IT booms


FRANK CLEMENTE
The GOP tax bill is creating jobs — just not in the US


WAYNE O’LEARY
The yellow and the green


JOHN BUELL
Which way the yellow vests?


JOEL D. JOSEPH
Worldwide corporate tax dodge


BOB BURNETT
Trump’s slow-motion breakdown


BOOK REVIEW/Heather Seggel
Let it all out


ROB PATTERSON
Thank goodness for Bob Dylan


SATIRE/Rosie Sorenson
There’s a new crust in town


MOVIE REVIEW/Ed Rampell
The life aquatic with Hawaiian Jason Momoa: Polynesian power!


Midterm Madness

Graphic by Kevin Kreneck

AUMFs are really MFs, as they give POTUS authority to wage wars w/o first asking Congress. Let’s support Barbara Lee’s legislation to repeal 2001 & 2002 AUMFs

Wednesday, January 9, 2019

Trump’s wall is a typical GOP maneuver: Propose a stupid idea that hurts non- whites to solve a non-existent problem

By Marc Jampole

As Stephen Colbert pointed out, Republican strategist Stuart Stevens best characterized Donald Trump’s Oval Office speech about the proposed wall along our Southern border hours before Trump gave the speech: “There are numerous examples of presidential addresses made to calm a public. This will be the first to frighten a calm public.”

The partial federal government shutdown is now well into its third week and millions of Americans are suffering because Donald Trump and his Republican flunkies in the Senate insist on building a wall along the border of Mexico, a bad solution to a non-existent problem. We already do tight security screening and illegal entry is way down, thanks to a combination of better Latin American economies and the unwelcoming attitude of the current administration.

It’s not the first time that Republicans have addressed a non-existent problem with a solution that will hurt many people, primarily non-whites, and not help the country. Remember, the states under GOP control have passed dozens upon dozens of restrictive voting laws to address the non-existent problem of voter fraud by individuals. Just as the origins of building a wall is racism, so was the wave of new voter laws, which have targeted minorities, the young and the poor. For example, the Texas voter ID law allows voters to use a hunting license as proof of identification, but not a Texas university ID card. As with the wall, new voter registration laws solved a non-existent problem by targeting non-whites.

Time and time again, Republicans have used non-existent problems in the economy as the excuse to give tax breaks to the wealthy. Once again, there were no long-term problems with the economy. But even if there had been—as there were in 2008—the way to grow the economy and create jobs is never to give tax breaks to the wealthy. What works much better is to give tax breaks to the poor and lower middle class. But what works the best is to raise taxes on the wealthy and invest the money in the economy—building new dedicated mass transit, fixing roads and bridges, making college more affordable, developing carbon neutral technologies. Yet every time the Republicans seize power, the first thing they do is lower taxes on the wealthy. They did it under Reagan, Bush II and now, Trump. Lowering taxes on the wealthy hurts not only racial minorities and the poor, but the middle class and most of the upper middle class, in several ways: It takes money out of the economy, as the rich invest their tax savings in the secondary stock market, bigger houses and other non-productive assets. More important, the government has fewer funds to invest in programs that actually grow the economy and create jobs.

The Afghanistan war breaks the GOP pattern of solving a problem that doesn’t exist with something stupid and racist, but just a little bit. We did have a terrorism problem in 2001. The Afghan War started within a month of 9/11, supposedly to hunt Al Qaida. So the problem was real, but the solution was just plain stupid—the wrong answer, almost by definition, since every outside power that has ever tried to invade or control Afghanistan has instead got caught in the worst kind of intractable, unending, unwinnable quagmire. The Soviet Union, England, the Sikhs, the Mughals—all of these governments invaded Afghanistan, and all soon regretted it. As has the United States.

That brings us to Iraq. Let’s set aside the war for a second and think about what the government had done by 2003 to fight terrorism—greater cooperation with allies, an enormous increase in surveillance, enhanced airport and border security and the development of drones are just some of the many ways we fought terrorism from outsiders after 9/11. Some would say, and include me in this group, that we committed overkill. By 2003, terrorism was no longer a problem, thanks to the Draconian measures the Bush II Administration took, with the cooperation of the Democrats. Thus the war in Iraq was another wrong-headed GOP solution to a non-existent problem that ended up severely hurting populations of non-whites. It perfectly follows the pattern of the wall, voting restrictions and tax breaks for the wealthy.

Those who say Trump has taken over the Republican Party are absolutely and completely wrong. Trump and the GOP were a match made in heaven. Trump’s policies and actions are completely consistent with Republican ideology since Reagan. His decision-making process fits right into Republican strategizing: Create a problem and solve it with a cockamamie idea that hurts non-whites. The wall represents the apotheosis of Reaganism. Those Republicans like Romney and Corey Gardner who criticize Trump only dislike his obvious emotional instability, his crude style, his addiction to lies and the overtness of his racism. They’re fine with his policies.

Trump’s foreign policy does represent a break from Republican ideology, to be sure. He rejects traditional alliances and seems fond of autocrats—perhaps picturing himself as the de facto leader of an international white nationalist movement. Of course, the true leader is Vladimir Putin.

But he deserves credit for announcing the drawdown of about half the troops in Afghanistan. We can only hope that he follows through on this promise, and soon brings home all our remaining troops in Afghanistan.

That would be a start to dismantling the global U.S. military machine now operating in 80 countries total. We have active troops fighting in 14 countries and have recently bombed or used drones in 7. Our military personnel conduct counterterrorism training in 65 countries. All this, in addition to our 40 military bases around the globe. While Trump courts disaster to turn his back on our allies, start a trade war with China and replace multilateralism with go-it-alone bellicosity, his instinct to bring home U.S. troops is a good one.


But even when he gets it right, Trump screws it up. Of all the many places where the United States has an active military engagement, just about the only one we can justify is our presence in Syria. We have no business in Afghanistan, Iraq, Libya, the Central African Republican, Yemen, Mali and elsewhere, but our small force in Syria does bring a small measure of stability to the civil-war ravaged country. We can only leave once there is a permanent political solution that protects the Kurdish population. To do otherwise would mean we have abandoned an ally, a despicable action that we know Trump has embraced before in both his business and political careers.