Coddled Long Enough: The “Buffett Rule” Vs “Class Warfare”
Over the weekend, the White House leaked word that President Obama will push a new debt-reduction idea: the “Buffett Rule.” Named after Warren Buffett, the chairman and chief executive of Berkshire Hathaway, who’s been urging policymakers to raise taxes on the very wealthy. As Buffett recently explained, millionaires and billionaires “have been coddled long enough.”
We don’t yet know the details of the proposal — most notably, what the new millionaires’ minimum tax rate would be — but Republicans are already responding with predictable disgust.
Here, for example, was House Budget Committee Chairman Paul Ryan (R-Wis.) yesterday on Fox News, making the case for coddling millionaires and billionaires for a while longer. See if you can pick up on the subtlety of his talking points.
“Class warfare, Chris, may make for really good politics but it makes a rotten economics. We don’t need a system that seeks to divide people. […]
“[I]t looks like the president wants to move down the class warfare path. Class warfare will simply divide this country more. It will attack job creators, divide people and it doesn’t grow the economy. […]
“[I]f we are just going to do class warfare and trying to get tax increases out of this, and I don’t think much will come of it…. He’s in a political class warfare mode and campaign mode.”
So, I guess I’ll put him down as a “maybe” on the Buffett Rule?
By any reasonable measure, Ryan’s arguments aren’t just wrong, they’re borderline offensive.
For a generation, Republican policymakers have rigged national tax policy to reward the wealthy, and then reward them some more. We’ve seen the class gap reach Gilded Era levels, only to hear GOP officials again demand that working families “sacrifice” while lavishing more breaks on the very wealthy.
Remind me, who’s engaged in “class warfare” and “dividing people”?
Also note the larger policy context here. President Obama wants the richest of the rich to pay a little more, but keep tax breaks in place for the middle class. Paul Ryan and his cohorts want the polar opposite — more breaks for the very wealthy and higher taxes for the middle class.
Let’s also not forget that one of the GOP’s more common tax-policy arguments is that nearly half the country doesn’t have any federal income tax burden — and they see that as a problem that needs fixing. As a practical matter, the Republican argument on this is practically the definition of “class warfare.”
I realize much of the political establishment has come to look at Paul Ryan as a wise wonk who deserves to be taken seriously, but it really doesn’t take much to realize how spectacularly wrong the far-right Wisconsinite really is.
By: Steve Benen, Washington Monthly Political Animal, September 19, 2011
Quality Vs Quantity: Yes, We Need Jobs. But What Kind?
On Thursday, President Obama will deliver a major speech on America’s employment crisis. But too often, what is lost in the call for job creation is a clear idea of what jobs we want to create.
I recently led a research team to the Rio Grande Valley in Texas, where Gov. Rick Perry, a contender for the Republican presidential nomination, has advertised his track record of creating jobs. From January 2000 to January 2010, employment in the Valley grew by a remarkable 42 percent, compared with our nation’s anemic 1 percent job growth.
But the median wage for adults in the Valley between 2005 and 2008 was a stunningly low $8.14 an hour (in 2008 dollars). One in four employed adults earned less than $6.19 an hour. The Federal Reserve Bank of Dallas reported that the per capita income in the two metropolitan statistical areas spanning the Valley ranked lowest and second lowest in the nation.
These workers aren’t alone. Last year, one in five American adults worked in jobs that paid poverty-level wages. Worker displacement contributes to the problem. People who are laid off from previously stable employment, if they are lucky enough to find work, take a median wage hit of over 20 percent, which can persist for decades.
To understand the impact of low wages, in the Valley and elsewhere, we interviewed a wide range of people, including two directors of public health clinics, three priests, a school principal and four focus groups of residents. Everyone described a life of constantly trying to scrape by. One month they might pay for the phone, another, for utilities. Everyone knew how long each company would carry unpaid bills before cutting service. People spoke not only of their fear of an unexpected crisis — an illness, a broken car — but also of the challenge of paying for basic needs like school supplies. Many used the phrase “one paycheck away from homelessness.”
Because their parents cannot afford child care, children move among relatives and neighbors. They watch too much TV. They don’t finish their homework. Older children grow up too fast from parenting their younger siblings. As one person observed, “All you think about is which bill is more important.”
Economic stress strains marriages. Parents cannot afford quinceañeras for their daughters. In church youth groups, teenagers ask why they should stay in school if all they can get are low wages.
Many children are latchkey kids. Accidents are frequent; we heard of an elementary school student who badly burned himself in a science experiment, with his older brother watching. Their father couldn’t take time off from work to visit his son in the hospital. Children come to school sick. Parents miss teacher conferences because they can’t afford time off. Type 2 diabetes is a scourge in the Valley. Since Type 2 diabetics can be asymptomatic for years, many don’t buy medicine; as time passes, they become severely ill, often losing sight or a limb.
The director at one clinic, with nearly 70,000 visits a year, estimated that half of its patients had anxiety or depression. Often people can’t get to the clinic because they cannot afford to lose work time or because gas costs too much. When they go, they take their families, because they have no child care.
And yet the Valley is not hopeless. Teachers stay late to help with homework. They make home visits to meet parents. Health clinic employees work overtime. The community organization Valley Interfaith has pushed for training opportunities and living-wage jobs. There is no “culture of poverty,” but the low-wage economy has corrosive and tragic consequences.
Must we choose between job quality and quantity? We have solid evidence that when employees are paid better and given more opportunities within a company, the gains outweigh the costs. For example, after a living wage ordinance took effect for employees at the San Francisco International Airport, in 1999, turnover fell and productivity rose.
Contrary to the antigovernment rhetoric, there is much that the public sector can do to improve the quality of jobs.
A recent analysis by the Economic Policy Institute reported that 20 percent of federal contract employees earned less than the poverty level for a family of four, as opposed to 8 percent of traditional federal workers. Many low-wage jobs in the private sector (notably, the health care industry) are financed by taxpayers. The government can set an example by setting and enforcing wage standards for contractors.
When states and localities use their zoning powers to approve commercial projects, or offer tax incentives to attract new employers, they can require that workers be paid living wages; research shows this will not hurt job growth.
Labor standards have to be upgraded and enforced, particularly for those employers, typically in low-wage industries, who engage in “wage theft,” by failing to pay required overtime wages or misclassifying workers as independent contractors so that they do not receive the benefits to which they are entitled.
Americans have long believed that there should be a floor below which job quality does not fall. Today, polls show widespread support for upgrading employment standards, including raising the minimum wage — which is lower, in inflation-adjusted terms, than it was in 1968. It’s time for the federal government to take the lead in creating not just more jobs, but more good jobs. The job-growth mirage of the Rio Grande Valley cannot be our model.
By: Paul Osterman, Op-Ed Contributor, The New York Times, September 5, 2011
“Enumerated Powers” And The Radicalism of The GOP Thought Process
Republican presidential hopeful Rick Perry chatted with The Daily Beast yesterday, and was asked about his understanding of “general welfare” under the Constitution. The left, the Texas governor was told, would defend Social Security and Medicare as constitutional under this clause, and asked Perry to explain his own approach. He replied:
“I don’t think our founding fathers, when they were putting the term ‘general welfare’ in there, were thinking about a federally operated program of pensions nor a federally operated program of health care. What they clearly said was that those were issues that the states need to address. Not the federal government. I stand very clear on that. From my perspective, the states could substantially better operate those programs if that’s what those states decided to do.”
It’s worth pausing to appreciate the radicalism of this position. When congressional Republicans, for example, push to end Medicare and replace it with a privatized voucher scheme, they make a fiscal argument — the GOP prefers to push the costs away from the government and onto individuals and families as a way of reducing the deficit.
But Perry is arguing programs like Medicare and Social Security aren’t just too expensive; he’s also saying they shouldn’t exist in the first place because he perceives them as unconstitutional. Indeed, when pressed on what “general welfare” might include if Medicare and Social Security don’t make the cut, the Texas governor literally didn’t say a word.
Now, this far-right extremism may not come as too big a surprise to those familiar with Perry’s worldview. He’s rather obsessed with the 10th Amendment — unless we’re talking about gays or abortion — and George Will recently touted him as a “10th Amendment conservative.” Perry’s radicalism is largely expected.
It’s worth noting, then, that Mitt Romney seems to be in a similar boat. He was asked in last night’s debate about his hard-to-describe approach to health care policy, and the extent to which his state-based law served as a model for the Affordable Care Act. Romney argued:
“There are some similarities between what we did in Massachusetts and what President Obama did, but there are some big differences. And one is, I believe in the 10th Amendment of the Constitution. And that says that powers not specifically granted to the federal government are reserved by the states and the people.”
What I’d really like to know is whether Romney means this, and if so, how much. Because if he’s serious about this interpretation of the law, and he intends to govern under the assumption that powers not specifically granted to the federal government are reserved by the states and the people, then a Romney administration would be every bit as radical as a Perry administration.
After all, the power to extend health care coverage to seniors obviously isn’t a power specifically granted to the federal government, so by Romney’s reasoning, like Perry’s, Medicare shouldn’t exist. Neither should Social Security, the Civil Rights Act, the Clean Air Act, student loans, FEMA, or many other benchmarks of modern American life.
And if Romney doesn’t believe this, and he’s comfortable with Medicare’s constitutionality, maybe he could explain why the federal government has the constitutional authority to bring health care coverage to a 65-year-old American, but not a 64-year-old American.
By: Steve Benen, Contributing Writer, Washington Monthly-Political Animal, August 12, 2011
Iowa’s GOP Governor Vetoes Tax Break For The Poor Because It Didn’t Lower Corporate Taxes
Iowa Gov. Terry Branstad (R) has a curious justification for vetoing a tax break last week for 240,000 Iowa families making $45,000 or less a year: the plan didn’t also include a tax break for corporations. Members of both partiesin the Iowa House and Senate agreed to increase the state’s Earned Income Tax Credit (EITC), which reduces the amount of income taxes lower-income families owe:
The change would have saved Iowa families an estimated $28.5 million in taxes over two years.
Branstad vetoed that part of the bill writing that it is his desire to approach tax policy in a more comprehensive and holistic manner. […]
Branstad additionally campaigned last year to slash Iowa’s corporate income tax rate by 50 percent, which he said would attract businesses while costing the state about $200 million a year in lost revenue. That proposal also failed.
Ironically, given Branstad’s fondness for expensive corporate tax breaks, he said he was concerned about the cost of the measure, estimated at $28.5 million a year. Branstad explained that he would only support “an overall tax reduction package that both fits within our sound budgeting principles while reducing those taxes that are impeding our state’s ability to compete for new business and jobs.”
Tim Albrecht, a spokesman for the governor, reiterated that Branstad would have supported the tax break if it had been part of a “larger effort” that included lower taxes for corporations. But since this tax break was only for poor families, Branstad suddenly abandoned his “strong support for tax relief.”
Sen. Joe Bolkcom (D), the chairman of the Senate Ways and Means Committee, points out that the EITC “is the most effective antipoverty program for working families.” Bolkcom said of Branstad’s veto, “He has again shown that he will only consider tax cuts that benefit Iowa’s wealthiest citizens and corporations.” The tax break for working families would have translated into more money for people to spend in Iowa’s economy, but Branstad apparently prefers “huge, unaffordable tax breaks for Wal-Mart and other wealthy out-of-state corporations.”
Branstad has the authority to veto individual items in spending measures. He also effectively shut down dozens of unemployment offices by vetoing language that would have prohibited the Iowa Workforce Development from closing 37 unemployment field offices across the state.
By: Marie Diamond, Think Progress, August 3, 2011
“The Marriage Vow”: The Candidate “Pledge” To End All Pledges
So in the wake of the “Cut, Cap and Balance Pledge” signed by seven Republican presidential candidates, and the “Pro-Life Presidential Pledge” signed by five, along comes Iowa social conservative kingpin Bob Vander Plaats of the Family Leader organization with a new pledge–actually an oath–it calls “The Marriage Vow.”
You have to read this document to believe it. Styled as a “pro-family” platform, the pledge goes far beyond the usual condemnations of same-sex marriage and abortion and requires support for restrictions on divorce (hardly a federal matter), the firing of military officers who place women in forward combat roles, and “recognition of the overwhelming statistical evidence that married people enjoy better health, better sex, longer lives, [and] greater financial stability.” If that’s not enough, it also enjoins “recognition that robust childbearing and reproduction is beneficial to U.S. demographic, economic, strategic and actuarial health and security.” This, in case you are wondering, is a nod to the “Full Quiver (or Quiverfull) Movement” that encourages large families in a patriarchal structure as a religious obligation, not to mention to those anti-choicers who want to ban some of the most popular forms of contraception.
The preamble to the “Marriage Vow” is even weirder, asserting among other things that “faithful monogomy” was a central preoccupation of the Founding Fathers; that slaves benefitted from stronger families than African-Americans have today; and that any claims there is a genetic basis for homosexuality are “anti-scientific.”
The “Marriage Vow” seems tailor-made to feed the backlash against ever-proliferating “pledges” imposed on Republican presidential candidates by the Right. But Vander Plaats and his group cannot be dissed without risk by anyone wanting to win the Iowa Caucuses. A perennial statewide candidate (his 2010 primary challenge to now-Gov. Terry Branstad won a surprising 41% of the vote), Vander Plaats was co-chair of Mike Huckabee’s victorious 2008 Iowa Caucus campaign, and also spearheaded the successful 2010 effort to recall state Supreme Court judges who supported the 2009 decision legalizing same-sex marriage.
Kevin Hall of The Iowa Republican suggests that the “Vow” is a power-play by VanderPlaats to influence the outcome of the August 13 Iowa State GOP straw poll, in which The Family Leader has pledged neutrality, by separating candidates deemed acceptable from those who won’t sign the oath. And indeed, Michele Bachmann, rumored to be Vander Plaats’ current favorite, signed it virtually before the ink dried. What will really be interesting is whether Tim Pawlenty, who has been eagerly accepting every ideological demand made of him by the Right, signs this document. It is certainly designed to freak out the more secular-minded Establishment Republicans he will eventually need if he is to put together a winning coalition of everyone in the party who doesn’t like Mitt Romney. But he has to do well in Iowa for that to matter, so my guess is that he will follow Bachmann in kissing Vander Plaats’ ring and associating himself with a fresh batch of extremism.
By: Ed Kilgore, The Democratic Strategist, July 8, 2011
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