“Growing Inequality”: A Rich Man, Poor Man Election
Three new reports on taxes, inequality and economic mobility add up to one conclusion: The 2012 presidential election should be about one thing, and one thing only: class warfare.
Let’s start with a report from the Pew Charitable Trusts, “Pursuing the American Dream: Economic Mobility Across Generations.”
The Pew Economic Mobility Project has been tracking the economic status of thousands of families since 1968 — the data covered in the current report is through 2009. And there is some good news: Absolute income has increased for Americans of all economic classes, from the poorest to the richest. The richest Americans have seen much larger relative gains, and, naturally, are far more immune to skyrocketing healthcare and education costs than are the poor, but at least part of the American dream is still intact: Children are still earning higher incomes than their parents.
But then comes the bad news: When one measures wealth — the total assets held by families — instead of income, the picture is substantially different. As Catherine Rampell summarized in the New York Times:
The median person in the poorest quintile has a family net worth that is 63 percent less than that of his counterpart a generation ago: $2,748, versus $7,439 …
The median family in the top socioeconomic class today (i.e., the family at the 90th percentile) is worth $629,853, compared to $495,510 in the last generation. That’s a 27 percent increase in the size of the median fortune in the top income stratum.
If you’re scoring at home: Rich: richer; Poor: poorer.
Now let’s move to “Inequality and Redistribution During the Great Recession,” a research paper produced by the Minneapolis Fed.
In 2010, the bottom 20 percent of the U.S. earnings distribution was doing much worse, relative to the median, than in the entire postwar period. This is because their earnings (including wages, salaries, and business and farm income) fell by about 30 percent relative to the median over the course of the recession. This lowest quintile also did poorly in terms of wealth, which declined about 40 percent …
However, even as earnings plunged, disposable income and consumption managed to hold even, relatively speaking, for the poorest Americans as compared to other classes. This is a bit of a mystery, noted the authors, who believe it can be explained by aggressive government redistribution and tax cuts.
Our main substantive conclusion is that government redistribution in the Great Recession was at historical highs and partially shielded households from experiencing large declines in disposable income and consumption expenditures. The same households, though, have experienced losses in net wealth, and this might make them more vulnerable to further or more persistent earnings declines in the future.
If you’re still keeping score: While the rich were getting richer and the poor poorer, the Great Recession absolutely hammered the worst-off Americans, but substantial government support — unemployment benefits, food stamps, Medicaid, tax cuts — saved the most vulnerable Americans from utter disaster.
And that brings us to our third report, the Congressional Budget Office’s latest numbers on federal taxes: “The Distribution of Household Income and Federal Taxes: 2008-2009.”
The bottom line: In 2009, as a result of tax cuts included in the stimulus, Americans ended up paying the lowest percentage of their income in federal taxes since 1979.
The observations included in these reports mutually reinforce each other. For example, one reason why the wealthiest Americans have done so much better than everyone else is directly related to substantial cuts in the capital gains tax rate over the past several decades. High unemployment and the collapse in home prices as a result of the Great Recession, on the other hand, have a disproportionately greater effect on poorer Americans, whose net wealth has been declining over past decades.
The numbers also beg to be put in political context. Over the long term, the rich have been getting richer and the poor poorer. In the short term, the poor took the brunt of the impact of the Great Recession, and were only kept afloat through government assistance. However, as tax rates have fallen to historic lows, it has become more and more difficult for the federal government to find the resources necessary to ameliorate widening inequality.
Now consider the fact that the Republican candidate for president wants to cut taxes even further, while eviscerating the social welfare safety net that is the only thing staving off complete economic disaster for poorer Americans. It’s class warfare all right, but one side seems to have already won.
By: Andrew Leonard, Salon, July 11, 2012
“Coyote Ugly”: Media Barred From Photographing Romney With Cheney
Dick Cheney hosted a fundraiser for Mitt Romney last night at his home in Wyoming. Donors paid $1,000 to attend a reception, $10,000 for a picture with Romney and $30,000 to eat dinner with Romney and Cheney in the former vice president’s home. While reporters were on hand to cover some of the events, media were not allowed to take photos of Cheney and Romney together. The Los Angeles Times explains:
Because of the unpopularity of Bush and Cheney, Romney has kept his distance — never appearing publicly with either man during his 2012 campaign. Though both leaders are admired by many in the Republican Party base, any perception of closeness with Romney could be harmful as the unofficial Republican nominee seeks to draw in independent and moderate voters.
Indeed, it seems that Romney has been playing a double game this campaign season in an effort to draw away any attention to his neocon-inspired foreign policy. In public, he either chooses to ignore national security issues or he and his advisers don’t distinguish the presumptive GOP nominee’s foreign policy from President Obama’s too much.
Behind the scenes, however, it’s quite a different story. As Bush administration Secretary of State Gen. Colin Powell noted recently, Romney’s foreign policy advisers “are quite far to the right.” Many of them advocated for the Iraq war and now want war with Iran.
And the ones who want war reportedly have Romney’s ear as one top Republican operative told Reuters recently that the moderate camp inside Romney’s foreign policy team “are very concerned about the fact that if Romney needs to call anyone, his instinct is to call the Cheney-ites.” Another Romney aide, Vin Weber — who has received scrutiny for lobbying for countries with poor human rights records — told the Washington Post that “it’s inevitable” that the Bush-Cheney alumni advising Romney on foreign policy are going to “have some influence.”
Cheney praised Romney last night as the “only” candidate to make what he thinks are the right foreign policy decisions as commander-in-chief. In fact, Romney shares Cheney’s views on a number of national security issues, as Rep. Adam Smith (D-WA) observed in an article in Foreign Policy yesterday: “A Romney presidency promises to take us back to something all too familiar: a Bush-Cheney doctrine — equal parts naïve and cavalier — which eagerly embraces military force without fully considering the consequences.”
By: Ben Armbruster, Think Progress, July 13, 2012
“Wrong Kind Of People”: The GOP’s Crime Against Voters
Spare us any more hooey about “preventing fraud” and “protecting the integrity of the ballot box.” The Republican-led crusade for voter ID laws has been revealed as a cynical ploy to disenfranchise as many likely Democratic voters as possible, with poor people and minorities the main targets.
Recent developments in Pennsylvania — one of more than a dozen states where voting rights are under siege — should be enough to erase any lingering doubt: The GOP is trying to pull off an unconscionable crime.
Late last month, the majority leader of the Pennsylvania House of Representatives, Mike Turzai, was addressing a meeting of the Republican State Committee. He must have felt at ease among friends because he spoke a bit too frankly.
Ticking off a list of recent accomplishments by the GOP-controlled Legislature, he mentioned the new law forcing voters to show a photo ID at the polls. Said Turzai, with more than a hint of triumph: “Voter ID, which is gonna allow Governor Romney to win the state of Pennsylvania — done.”
That’s not even slightly ambiguous. The Democratic presidential candidate has won Pennsylvania in every election since 1992. But now the top Republican in the Pennsylvania House is boasting that, because of the new voter ID law, Mitt Romney will defy history and capture the state’s 20 electoral votes in November.
Why on earth would Turzai imagine such a result? After all, the law applies to all voters, regardless of party affiliation. It is ostensibly meant only to safeguard the electoral process and eliminate fraud. Why would a neutral law have such partisan impact?
Thanks to figures released last week by state officials, we know the answer. It turns out that 758,939 registered Pennsylvania voters do not have the most easily obtained and widely used photo ID, a state driver’s license. That’s an incredible 9.2 percent of the registered electorate.
Most of the voters without driver’s licenses live in urban areas — which just happen to be places where poor people and minorities tend to live. More than 185,000 of these voters without licenses, about one-fourth of the total, live in Philadelphia — which just happens to be a Democratic stronghold where African Americans are a plurality.
Could suppressing the urban minority vote really give Pennsylvania to Romney? It probably wouldn’t have made a difference in 2008, when Obama trounced John McCain handily. But the statewide contest is often much closer — and turnout in Philadelphia typically is key to a Democratic candidate’s prospects. In 2004, for example, John Kerry’s margin over George W. Bush in the state was a mere 144,248.
Perhaps these numbers are so intoxicating that Turzai forgot the cover story about how voter ID is supposed to protect the franchise rather than selectively restrict it. His spokesman later explained that Turzai meant “the Republican presidential candidate will be on a more even keel thanks to voter ID” — in other words, there will be a level playing field once the new law eliminates all that pesky voter fraud.
That might be reasonable, except for one fact: There’s no fraud to eliminate.
Prodded by GOP political activists, the Justice Department under Bush conducted an extensive, nationwide, five-year probe of voter fraud — and ended up convicting a grand total of 86 individuals, according to a 2007 New York Times report. Most of the cases involved felons or immigrants who may not have known they were ineligible to vote.
Not one case involved the only kind of fraud that voter ID could theoretically prevent: impersonation of a registered voter by someone else. Pennsylvania and other voter ID states have, in essence, passed laws that will be highly effective in eradicating unicorns.
The Pennsylvania law and others like it are under attack in the courts; this week, a federal three-judge panel in Washington is hearing arguments on Texas’s year-old law, with a ruling expected next month. Meanwhile, Michigan Gov. Rick Snyder, a conservative Republican, broke with orthodoxy last week and vetoed bills that would have toughened an existing voter ID statute. Maybe the tide is turning. If it doesn’t, these laws will potentially disenfranchise or discourage millions of qualified voters.
In a previous column, I wrote that voter ID was a solution in search of a problem. I was wrong: The problem seems to be that too many of the wrong kind of voters — low-income, urban, African American, Hispanic — are showing up at the polls. Republican candidates have been vowing to “take back” the country. Now we know how.
By: Eugene Robinson, Opinion Writer, The Washington Post, July 9, 2012
“In A Pretty Pickle”: I Did Not Have Economic Relations With That Company
There’s something weird about Bain Capital. It seems that the company was going along doing what ordinary private-equity firms do—buying and selling companies, making lots of money—until about 1999 or so, when things took a sinister turn. At that point, terrible things began to happen. The firms they backed went into bankruptcy, costing thousands of people their jobs, while Bain still walked away with millions in management fees. They invested in companies that profited from outsourcing and offshoring. Who knows, they may have been producing magical hair-thickening elixirs made from the tears of orphans. Every time one of these new revelations comes out, it seems to concern the period after 1999. But fortunately for Mitt Romney, he has an explanation: When all these bad things happened, I was no longer part of the firm. I left in 1999, when I took the job leading the Salt Lake City Olympics.
Yet today, the Boston Globe comes out with an investigation that seems to reveal that Romney was still in charge after he left for Salt Lake:
Government documents filed by Mitt Romney and Bain Capital say Romney remained chief executive and chairman of the firm three years beyond the date he said he ceded control, even creating five new investment partnerships during that time.
Romney has said he left Bain in 1999 to lead the winter Olympics in Salt Lake City, ending his role in the company. But public Securities and Exchange Commission documents filed later by Bain Capital state he remained the firm’s “sole stockholder, chairman of the board, chief executive officer, and president.”
Also, a Massachusetts financial disclosure form Romney filed in 2003 states that he still owned 100 percent of Bain Capital in 2002. And Romney’s state financial disclosure forms indicate he earned at least $100,000 as a Bain “executive” in 2001 and 2002, separate from investment earnings.
It doesn’t seem too hard to believe that while Romney was in Salt Lake, he also continued to be involved in the major decisions at Bain—even if he wasn’t available to pitch for the company softball team. The problem now is that he’s spent a lot of time denying that he had anything at all to do with the firm after February 1999. He and Bain say he “retired” from Bain at that point, which is directly contradicted by the SEC filings. I’m guessing the truth is somewhere south of his denials—he may not have been “running” the firm, but he was still involved at some level. But if he were to admit that, then he’d have to answer specific questions about his knowledge of the steel mill that went bankrupt, the outsourcing companies, and so on. And there is nothing in the world Mitt Romney wants to do less than have to answer specific questions about Bain and what he did there.
In a way, this all reminds me of some of what we learned about Bill Clinton during the Monica Lewinsky scandal. One of the details that came out was that he was adamant that he and Monica did not have intercourse during their affair, apparently because that meant that he could convince himself that he wasn’t really cheating on his wife and say with sincerity that he “did not have sexual relations” with her when he eventually got caught. All of this wrangling over when exactly Romney “left” Bain Capital has some of the same flavor.
By: Paul Waldman, Contributing Editor, The American Prospect, July 12, 2012
“Romney Embraces Judicial Extremism”: Supreme Court Is A Winning Issue For Progressives
A national poll released this week shows that in the wake of a number of blockbuster decisions, the Supreme Court can be a winning issue for progressives in 2012.
By big margins, Americans trust President Obama much more than they trust Mitt Romney to pick Supreme Court Justices, according to an ABC News/Washington Post poll released Tuesday. The poll, which comes two weeks after the Supreme Court narrowly upheld President Obama’s Affordable Care Act, shows that the Supreme Court is the issue on which the president has the clearest and largest lead over Romney — 11 points among all voters and 12 points among independents.
Americans know judicial extremism when they see it, and are rejecting Romney’s promise to bring an already far-right Court even further out of the mainstream.
The current Supreme Court is, by a number of measures, the most conservative in decades. Under the leadership of Chief Justice John Roberts, a conservative majority on the Court has struck down hard-won clean elections laws, made it more difficult for women to sue for equal pay, squashed class action suits, and consistently favored large corporations over individual citizens seeking justice. Even the Affordable Care Act decision, while undeniably a victory for the president and for individual Americans, was excruciatingly close and packed with regressive language on the scope of Congress’ powers. The fact is, under a more balanced Court, the decision would not have even been close.
Mitt Romney, however, has promised to bring the Court even further to the right if he is elected president. Romney sent a clear signal to the far right when he chose former Judge Robert Bork to head his judicial advisory team. Bork, whose own Supreme Court nomination was rejected by a bipartisan majority of the Senate in 1987, has for decades set the standard for far-right judicial extremism. His outspoken extremism on everything from workers’ rights to censorship is detailed in People For the American Way’s recent report, “Borking America.”
Last week, Romney moved his position on Supreme Court appointments even further to the right. While the candidate had previously held up Chief Justice Roberts as a model for the type of Supreme Court Justice he would appoint, Romney changed his mind after Roberts voted to uphold the Affordable Care Act. Declaring one of the most conservative Justices in Supreme Court history to be not conservative enough, Romney has signaled that he would usher in a new era of conservative judicial extremism. Americans can only guess at how many rights could be lost under a Romney Court.
These new polling numbers show that Americans aren’t buying the Tea Party’s — and Mitt Romney’s — skewed view of the Constitution. Emphasizing the importance of the courts and the impact the next president will have on them will be a winning issue for President Obama in 2012. As the close call in the Affordable Care Act case showed, every issue that voters care deeply about — from Wall Street reform to health care to LGBT rights to consumer safety to intentional discrimination in the workplace to the right to vote in future elections — will ultimately end up in the hands of a closely divided, enormously influential, Supreme Court.
In a speech Tuesday, Vice President Joe Biden urged Americans: “Close your eyes and imagine what the Supreme Court will look like after four years of Gov. Romney. Imagine what it will act like. Imagine what it will mean for civil rights, voting rights, and for so much we have fought so hard for.”
Voters are beginning to imagine a Romney Court — and they’re rejecting what they see.
By: Michael B. Keegan, The Huffington Post, July 12, 2012
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