“Moneyed Elites Get Richer The Old-Fashioned Way; Stealing”: Preferential Tax Treatment For The Narcissistic Money Manipulators
With the 2016 presidential campaigns in full swing, the burdens of the working middle class have taken center stage. And believe it or not, there is bipartisan support from the frontrunners on a key issue brought up over and over again. Donnie Trump is for it. Hillary Clinton is for it. Jeb Bush is for it. Bernie Sanders is for it. Even Barack Obama is for it. And the American people are overwhelmingly for it.
The “it” that’s drawing such broad support is the idea of ending a ridiculous tax loophole that was written by and for the richest, most pampered elites on Wall Street. An obscurely titled “carried interest” tax break allows billionaire hedge-fund hucksters to have their massive incomes taxed at a much lower rate than the one retail workers, Main Street businesses, carpenters, and other modest-income people must pay.
Keep that carried interest tax loophole in mind when I tell you this number: 158,000. That’s the number of kindergarten teachers in America. Their combined income in 2013 was $8 billion. Here’s another number for you: 25. That’s the number of America’s highest-paid hedge fund operators whose combined income in 2013 was $21 billion. Yes, just 25 Wall Street greedmeisters hauled off $13 billion more in pay than was received by all of our kindergarten teachers — the people we count on to launch the education of the next generation.
Which group do you think is rewarded by law with the lowest rate of income tax? Right: the uber-rich Wall Streeters! Incredibly, Congress (in its inscrutable wisdom) gives preferential tax treatment to the narcissistic money manipulators who do practically nothing for the common good. Even flamboyant celebrity narcissist Donnie Trump sees through the gross inequality of this tax scam: “The hedge fund guys didn’t build this country,” The Donald recently barked. “These are guys that shift paper around, and they get lucky. The hedge fund guys are getting away with murder.” Indeed, while dodging through this loophole, they pay about half the tax rate that kindergarten teachers are assessed. In effect, Wall Street’s puppets in Congress let this tiny group of moneyed elites steal about $18 billion a year that they owe to the public treasury to finance the structure and workings of America itself.
This privileged treatment of pampered paper- and money shufflers over people who do constructive work in our society adds to America’s widening chasm of inequality. It’s so unfair and unpopular that even Donald, Hillary, Jeb, Bernie and others are saying that it has to go. So it’s bye-bye, loophole, right?
Ha — just kidding! Trump can mouth all he wants, but no animal hath such fury as a hedge funder whose special tax boondoggle is threatened. Trump had barely gotten the word “unfair” out of his puffy lips before the tax-loophole profiteers deployed battalions of lobbyists, PR flacks, and front-group operatives out to defend their precious carried-interest provision. One group, with the arcane name of Private Equity Growth Capital Council, rushed a dozen Gucci-clad lobbyists to Capitol Hill to “inform” lawmakers about the virtues of coddling Wall Street elites with tax favors.
Of course, “informing” meant flashing their checkbooks at key members of Congress. After all, even the loudest blast of political talk is cheap — and it’s the silent sound of a pen writing out a campaign check that makes Washington World keep spinning in favor of the rich.
Sure enough, Rep. Paul Ryan (R-WI) and Sen. Orrin Hatch (R-UT) , the two lawmakers who head Congress’ tax-writing committees, quickly announced that — the will of the people aside — there would be no repeal of the hedge-fund loophole anytime soon. The inequality that is presently ripping our society apart is not the result of some incomprehensible force of nature, but the direct result of collusion between financial and political elites to rig the system for the enrichment of the few — i.e., themselves — and the impoverishment of the many. There’s a word for those elites: thieves.
By: Jim Hightower, The National Memo, September 30, 2015
“Why The GOP Is The True Party Of ‘Free Stuff'”: Bush’s Logrolling Directs Almost All The Benefits To People Who Don’t Need It
While other candidates are a lot crazier, Jeb Bush is clearly the most fumble-brained option in the presidential race. He can’t seem to string two words together without committing a grievous political faux pas. Whether it was his call for “phasing out” Medicare, or his scorn for women’s health issues, or his claim that Asians are the real anchor babies, he’s got a serious case of foot-in-mouth disease.
Now he’s out with a fresh clunker, this time about how Republicans, unlike Democrats, won’t try to lure black voters with “free stuff.” Primary voting is months away, and already Bush is flirting with language that may have lost Mitt Romney the election.
Bush’s argument — that Democrats cynically use welfare to buy black votes and thereby trap them in a cycle of dependency — is seriously mistaken, as well as deeply hypocritical. But a more fundamental mistake is the picture of government Bush envisions. Put simply, handing out “free stuff” of one sort or another is perhaps the most important job governments can do.
First, let’s tackle why black people vote Democratic. I think the answer can be illustrated best in two words: Strom Thurmond. He was a South Carolina Democrat when he broke the record for the longest Senate filibuster ever trying to stop the 1957 Civil Rights Act. But after a much more aggressive civil rights bill passed in 1964, he switched parties, eventually followed by most of the other Dixiecrats. As Philip Bump demonstrates, blacks unsurprisingly did the opposite at the same time, shifting very heavily towards the Democratic Party.
In other words, government benefits play, at best, an incidental role in black support for the Democrats. Republicans today are not segregationists, but they are the inheritors of a legacy of outright white supremacy. Thurmond was in the Senate until 2003. At his 100th birthday party in 2002, then-Senate Majority Leader Trent Lott (R-Miss.) praised Thurmond’s 1948 run for president under a third party apartheid ticket. (Lott later resigned as leader after his comments were made public.) Democrats have not been the finest stewards of black fortunes, but it’s pretty obvious that they’re better than the alternative.
That brings me to the hypocrisy. While Democrats support social benefits in a wishy-washy way, conservatives are absolutely obsessed with directing huge monetary benefits to their favored constituencies — namely, the rich.
George W. Bush’s tax cuts were violently skewed towards the wealthy — over 73 percent of the benefits went to the top income quintile, and fully 30 percent to 1 percenters alone. Jeb Bush aims to pull the same trick, proposing another corpulent set of tax breaks — only this time, over half of the benefits would accrue to the top 1 percent alone. You can’t win an election solely with the support of billionaires, of course, but Bush and his allies have also already raised over $120 million. Not, one suspects, a coincidence.
Overall, welfare benefits for the top income quintile — largely a result of conservative policymaking — cost roughly $355 billion yearly. Meanwhile, what passes for new policy in Republican circles — a child tax credit — is a government benefit for middle- and upper-class parents that carefully and deliberately excludes the poor.
But it would be a mistake to stop here. Good government types often rail against the blatant cronyism of Bush family politics — i.e., you give me hundreds of millions of dollars for my presidential campaign, and I’ll cut the capital gains tax so you can better loot your company — but making good policy isn’t as simple as being against patronage in general. As Francis Fukuyama points out in Political Order and Political Decay, Boss Tweed-style patronage politics can also be a first step towards an efficient, decent modern state. There is no bright line between handing out jobs to one’s ethnic community in return for votes, and constructing a modern bureaucracy that provides universal social benefits like clean air and water, low crime, a safety net, and so forth.
For what are governments good for, if not providing universal security and prosperity for as many citizens as possible? Even in a jalopy country like the U.S., the vast majority of state activity is dedicated towards this end, at least ostensibly. The military, to defend the nation; Social Security, to provide for the retired and disabled; Medicare, Medicaid, and ObamaCare, to provide universal access to health care; various safety net programs like food stamps and the Earned Income Tax Credit, to keep people from destitution — these together, plus interest on the national debt, account for 84 percent of direct federal spending. Many of these could be improved, or are badly misused, but that’s their bedrock ideological justification. Other nations with better versions of similar policies show that universal high-quality health care and an end to poverty are easily within our grasp.
So the problem with Bush’s logrolling — and Republican policy in general — is mainly that it directs almost all the benefits to people who don’t need it.
By: Ryan Cooper, The Week, September 28, 2015
“Democrats And Black Voters”: To Win The Support Of People Of Color, You Have To Incorporate Their Concerns
It has been pretty well established by now that a Democratic candidate can’t win the presidential nomination (much less a general election) without the support of African Americans. Due to that fact, it is interesting to take a look at how Charles Blow is summing up the challenge that faces Bernie Sanders in that regard.
Blow interviewed Sanders and then attended his rally at Benedict College in South Carolina. His column about that summarizes both some of his potential as well as missteps.
There is an earnest, if snappy, aura to Sanders that is laudable and refreshing. One doesn’t sense the stench of ambition or the revolting unctuousness of incessant calculation.
There is an idealistic crusader in the man, possibly to the point of being quixotic, but at least it doesn’t come off as having been corrupted by money or power or the God complex that so often attends those in pursuit of the seat behind the Resolute Desk.
Sanders’s message of revolutionary change to save a flailing middle class and challenge the sprawling influence of what he calls “the billionaire class” has struck a nerve with a fervid following.
When it comes to that Sanders message, I was struck by something that Blow tweeted, but left out of his column.
The income inequality message that Sanders kept hammering got a rousing response from wht ppl in audience, but hardly a peep from blks…
— Charles M. Blow (@CharlesMBlow) September 12, 2015
In his interview with Blow, Sanders stressed that his campaign recognizes that it is important to “aggressively reach out and bring the African-American community and the Latino community into our campaign.” And yet it appears as though Sanders is making the same mistake a lot of white people do when they realize the importance of garnering support from the African American community…they tweak their own message rather than listen and incorporate what they hear.
For example, Blow points out the tone-deafness of assuming that a Black man like Cornell West helps in that regard.
But Sanders’s ability to win Obama’s supporters may have been made difficult by his associations. On Saturday, Sanders campaigned with Dr. Cornel West, who recently issued an endorsement of Sanders.
West’s critique of the president has been so blistering and unyielding — he has called Obama “counterfeit,” the “black face of the American empire,” a verb-ed neologism of the n-word — that it has bordered on petulance and self-parody.
I would also suggest that one of the reasons Sander’s message fails to connect with African Americans is that – even in the midst of economic conditions that were much worse than today – Ellis Cose pointed out in 2011 that African Americans are the country’s “new optimists.”
As the United States struggles through its worst economic crisis in generations, gloom has seized much of the heartland. The optimism that came so easily to many Americans as the new century dawned is significantly harder to summon these days. There is, however, a conspicuous exception: African-Americans, long accustomed to frustration in their pursuit of opportunity and respect, are amazingly upbeat, consistently astounding pollsters with their hopefulness.
To the extent that optimism has dimmed more recently – it is in response to the shootings of unarmed Black men (often by police officers) and the lack of a “just response” from our justice system. No matter how hard Sanders tries to tie that one to his message about income inequality and economics, it will fall short of connecting to the souls of African Americans.
There is a lesson in all that for Democrats: to win the support of people of color, you have to incorporate their concerns…not simply tweak your own agenda and expect them to climb on your bandwagon.
By: Nancy LeTourneau, Political Animal Blog, The Washington Monthly, September 13, 2015
“Electioneering Committees”: Buying A President For 30 Bucks And Change
For today’s report, I have a bunch of statistics for you. Wait — don’t run away! Where are you going? Come back here and sit still while I drill these stats into your head! It’ll be fun, and you’ll learn something.
I realize that numbers can numb the brain, but this is a good story, and I promise that these statistics are easy to absorb. In fact, the number 400 pretty much sums up this story of political intrigue and corruption involving some of America’s wealthiest families and corporations.
Let’s start with the “Billionaire 400,” a clique of the elite organized by the conniving Koch brothers. These ultra-rich right wingers gather each winter in some warm-weather resort for a secretive, invitation-only retreat. There, they plot strategies and pledge money to elect politicos who’ll support their vision of corporate rule in America. For the 2016 elections, they’ve already committed nearly a billion dollars to impose their vision of plutocracy over our democratic ideals — double the combined amount that the Republican and Democratic parties will spend. I wonder: What do they think they’re getting for that price?
Then there are the secretive SuperPACs that are sacking up tens of millions of dollars to back various presidential candidates. Again, a few hundred corporations and rich families — each writing checks for hundreds of thousands and even millions of dollars — have put up nearly half of all the money in these electioneering committees.
Keep that 400 number in mind when I offer my sincerest congratulations to Mr. and Mrs. Middle-Class America, since they are all the rage in this present presidential contest, for Jeb, Hillary, and all the rest — even The Donald — say their campaigns are all about the hurting middle class that hasn’t yet recovered from the Great Recession. Well, don’t look now, but after each one promises that they’ll do the most for the Great Mass of the Middle Class, they disappear into the shadows and scurry off to schmooze with the little group of Americans they truly love: The exclusive club of multimillionaires and billionaires, who are shoveling those big bucks into those campaign pockets.
Now, back to our statistics: Jeb Bush got a million dollars each from 26 of his SuperPAC backers; Hillary Clinton took a million each from nine funders; of the $16 million in Marco Rubio’s PAC, 78 percent came from only four donors; and Ted Cruz got the most from the fewest, taking practically all of his $37 million from just three fat-cat families.
So while candidates for the highest office in our land are soaking up applause for the grand rhetoric they’re giving to the middle class, they’re also quietly collecting millions of dollars by pledging their steadfast fealty to the ruling class. Donating millions is not an innocent or noble political transaction. Written on the back of each of their checks is their own corporate agenda, trumping the people’s agenda.
Ironically, it’s Donnie Trump, the bombastic billionaire, who candidly admits that these so-called “gifts” amount to the outright, plutocratic purchase of politicians. He’s long been a campaign donor in order to secure political favors, he confesses, and it works: “When I need something from them … they are there for me.” There’s a word for that: Corruption.
But now, here comes the antidote to this corruption of our politics by fat cats. Instead of being financed by 400 special interests, Bernie Sanders’ campaign has raised its $15 million (as of July) from over 400,000 ordinary Americans. In fact, the average donation to Bernie is a heartwarming, soul-saving $31.30!
You can’t buy a president for just over 30 bucks — but you can help elect one who isn’t owned by Big Money. And isn’t that the way democracy ought to be?
By: Jim Hightower, The National Memo, September 9, 2015
“Waiting For Their Nixon”: Reformicons Horrified To Look In The Political Mirror And See The Scary Clown Face Of Trump Leering Back
A small but influential group of conservative intellectuals hoped that this presidential cycle could produce a ice-breaking debate in the GOP ranks over the party’s iron commitment to certain economic and fiscal orthodoxies that had proved impolitic to middle class voters, including the white working class voters (remember “Sam’s Club Republicans”?) who had recently become a key segment of the party base.
Well, the “reformicons” got more than they bargained for. As Josh Barro’s New York Times op-ed over the weekend archly pointed out, the current GOP presidential front-runner shares their disdain for the old-time religion of tax cuts for the wealthy financed by “entitlement reform,” and the hostility many of them have for comprehensive immigration reform as well. But your typical urbane reformicon is horrified to look into the political mirror and see the scary clown face of Donald Trump leering back at him or her.
It’s an awkward thing: The reform conservative movement, to the extent it exists, is pointy-headed, technocratic and soft-spoken. Mr. Trump is none of those things. But his campaign has helped bolster a key argument from the reformocons: that many Republican voters are not devotees of supply-side economics and are more interested in the right kind of government than in a simply smaller one.
“There were a lot of people who wanted to think the Tea Party is a straightforward libertarian movement,” said Reihan Salam, the executive editor of National Review. But he said Mr. Trump’s ability to lead the polls while attacking Republicans for wanting to cut entitlement programs showed that conservative voters are open to “government programs that help the right people.”
Indeed, so long as “the right people” means their own selves and “the wrong people” are those people. It’s always been a bit ironic that the reformicons claim a sort of kinship to the Tea Party, but prefer pols like Marco Rubio even as the Tea Folk themselves gravitate to the Sarah Palins and the Donald Trumps. And so they are torn between the impulse to declare Trump-o-mania a vindication of their prophecies and the healthy desire to distance themselves from racist demagoguery. One very prominent reformicon Barro talked with, David Frum, has the obvious if unappealing analogy in mind:
In an analogy that won’t make anyone very comfortable, [Frum] said Mr. Trump could be useful in the same way George Wallace was in 1968: “Wallace talked about a lot of issues, many of them pretty dismaying, but he also seized on the crime issue. Crime was rising fast, and it was not an issue that respectable politicians wanted to talk about. The result was that Richard Nixon stole his issue and deracialized it.”
Well, not exactly. Pressed on whether Nixon’s anticrime language could really be considered deracialized, Mr. Frum argued Nixon “diminished its racialism and incorporated it into something like a workable policy agenda.”
If Mr. Trump is Wallace in this analogy, then the reform conservatives are still waiting for their Nixon. Whether that’s a hopeful prospect or an alarming one is up to you.
So reformicons are joining the ever-swelling ranks–right there next to an awful lot of Democrats–of those who view Trump the way some fifth century Christians viewed Attila the Hun–as a Scourge of God sent to rebuke arrogant and decadent imperial elites. But I’d advise they avoid mirrors.
By: Ed Kilgore, Contributing Writer, Political Animal Blog, The Washington Monthly, September 8, 2015
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