By: Dana Milbank, Opinion Writer, The Washington Post, September 23, 2011
Obama Isn’t Trying To Start ‘Class Warfare’ — He Wants To End The Republican War On The Middle Class
History will record that on September 19, 2011, the Republicans made a huge political miscalculation — a miscalculation that could potentially doom their chances for victory next year.
If I were a Republican, the last thing I’d want to talk about is “class warfare.”
For 30 years — whenever they have been in power — Republicans and their Wall Street/CEO allies have conducted a sustained, effective war on the American middle class.
Much of the success of their war has resulted from their insistence that it didn’t exist. They have talked instead about how the economy needs to reward all those “job creators” whose beneficence will rain down economic prosperity on the rest of us.
They fund right-wing organizations that divert our attention by whipping up worry that gay marriage will somehow undermine heterosexual relationships. They start wars that help pad the bottom lines of defense contractors but do nothing to make us safer.
And all the while they quietly rig the economic game so that all of the growth in the Gross Domestic Product goes into the hands of the top two percent of the population — while they cut our pay, destroy our unions and do their level best to cut our Social Security and Medicare.
There has been a “class war” all right — a war on the middle class. And the middle class has been on the losing end.
Today the truly rich control a higher percent of our wealth and income than at any other time in generations. Income inequality is higher than at any time since 1928 — right before the Great Depression.
According to the Economic Policy Institute, “the richest five percent of households obtained roughly 82 percent of all the nation’s gains in wealth between 1983 and 2009. The bottom 60 percent of households actually had less wealth in 2009 than in 1983… ”
Today, 400 families control more wealth than 150 million Americans — almost half of our population.
American workers have become more and more productive — but they haven’t shared in the income generated by that increased productivity, so now they can’t afford to buy the products and services they produce.
The success of the Wall Street/CEO/Republican war on the middle class rests, in part, in the old frog in boiling water story. If you put a frog in a pot of boiling water, they say, the frog will jump right out. But if you put a frog in a pot and gradually turn up the heat until it boils you end up with a cooked frog.
Republican policies have gradually shifted wealth, income and power from the middle class — and those who aspire to be middle class — into their own hands and for obvious reasons they haven’t wanted to focus too much attention on “class warfare.”
So now if the Republicans want to talk about “class warfare” — in the words of George Bush — “bring ’em on.”
In fact, President Obama isn’t proposing to start a “class war” — he wants to end the war on the middle class.
Among other things, he has proposed that America live by the “Buffett Rule” — by Warren Buffett’s suggestion that he and his fellow billionaires should have to pay effective tax rates at least as high as their own secretary’s.
Obama pointed out yesterday that requiring hedge fund managers to pay effective tax rates as high as plumbers and teachers was not “class warfare.” The choice is clear: either you increase taxes on the wealthy — or dramatically cut Medicare, Medicaid and Social Security benefits. It is, as the President said, “simple math.”
Whereas Republican proposals to rein in the deficit by cutting Social Security, Medicare and Medicaid benefits are intended to continue this war on the middle class, the President’s plan — in stark contrast — addresses the three factors that actually caused the deficit in the first place.
From 1993 until 2000, Bill Clinton had successfully pushed back much of the Republican anti-middle class agenda. When he left office, America had a prosperous, growing economy, increasing middle class incomes, and budget surpluses as far as the eye could see.
Bush changed all that. The anti-middle class warriors were back in power, and they took the offensive. They passed massive new tax breaks for the rich, and set out to break unions.
Three Bush/Republican policies led directly to today’s deficit:
• Giant tax cuts for the wealthy;
• Two unpaid-for wars that will ultimately cost trillions;
• Trickle-down economic policies that did not create one net private sector job and ultimately caused the financial collapse that led to the Great Recession.
The Obama deficit proposal reduces the deficit by directly addressing these three factors — that actually caused the deficit — rather than demanding that the budget be balanced by taking even more out of the pockets of ordinary Americans.
A trillion dollars — 1.2 trillion with interest — is cut by ending the Wars in Iraq and Afghanistan. Those who argue that you shouldn’t count these reductions toward deficit reduction, because Obama already planned to end these wars, are ignoring the fact that they were a big reason why we have a deficit in the first place.
Second, Obama’s proposal eliminates the Bush tax cuts for the rich — and demands that millionaires, billionaires, oil companies, and CEO’s who fly around in corporate jets, pay their fair share.
Finally, the Obama plan includes a robust jobs package to jumpstart the economy and put America back to work. The Republicans have no jobs plan at all — none whatsoever. In fact, their plan is to simply let the Wall Street bankers and CEO’s continue to siphon as much as possible from the pockets of ordinary Americans.
The combination of Obama’s jobs and budget plans have set the stage for a clear, sharp battle for the soul of America. They have posed a stark contrast that is not framed as a battle over conflicting policies and programs — but as a struggle between right and wrong.
That battle will continue throughout this fall — and into next year’s elections.
These proposals, coupled with the President’s urgent, passionate advocacy, have transformed the political landscape.
The major iconic fights that will dominate American politics over the next 14 months will be the President’s jobs proposal, his call on millionaires and billionaires to pay their fair share, and the Democratic defense of Social Security, Medicare and Medicaid.
Democrats and Progressives have the high political ground on every one of these defining issues — and I don’t just mean slightly higher political ground — I mean political ground like Mount Everest.
By huge margins, Americans prefer to raise taxes on millionaires and billionaires rather than cut Social Security and Medicare. The choice is not even close — in most polls something like 8 to 1.
And who can possibly question that the number one priority of voters everywhere in America is jobs?
The Republican policies that led to the Great Recession did more damage than anyone knew. Many Republicans actually thought they would benefit politically by the long, slow economic slog that ensued in its aftermath. After all, no sitting President had won re-election in a century when the economy was not good or materially improving — except one.
Harry Truman won re-election in the midst of a bad economy in 1948 by running against the “Do-nothing Republican Congress.”
President Obama’s jobs and budget proposals have set the stage for just that kind of battle.
His proposals have simultaneously energized the progressive base and appealed to middle class swing voters — especially seniors — who agree entirely that the government should keep its hands off the Social Security and Medicare benefits they have earned, and turn instead to taxes on millionaires and billionaires to close the budget deficit that the Republican “class warfare” policies have created.
And it won’t hurt that these proposals have prompted the Republicans to turn the spotlight on the subject of “class warfare” itself. They should be careful what they wish for.
By: Robert Creamer, Strategist and Author, Published in HuffPost, September 20, 2011
Mr. Nice Guys?: Will Republicans Practice What They Tweet?
It appeared, at first glance, as if Eric Cantor’s Twitter account had been hacked — by a really nice guy.
In recent days, the extravagantly combative GOP House majority leader has been tweeting a veritable sampler box of bipartisan bonbons.
Sept. 21: “People don’t expect Republicans and Democrats to agree on everything, but they do expect us to overcome our differences and work together.”
Sept. 16: “Good people can have honest disagreements without having their morals or commitment to country being called into question.”
Sept. 13: “We need to work together towards the solutions that will meet the challenges facing our country today.”
Sept. 12: “Let’s try and lower the volume of the rancor in Washington, and focus on what we can do together to grow this economy and create jobs.”
And that is just a taste.
But this was no case of malicious (or, in this instance, magnanimous) hacking. After one of the ugliest summers political Washington has ever seen, Republicans, looking at poll numbers showing voters are even angrier with them than they are with President Obama, have decided to try the Mr. Nice Guy approach, in word and (occasional) deed.
They agreed to pass legislation keeping the Federal Aviation Administration going, abandoning the contentious provisions that led to this summer’s partial shutdown of the agency. They avoided another confrontation by extending highway spending without repealing the federal gas tax, a Tea Party priority. On Thursday, Senate Republicans yielded to President Obama’s demands and passed a worker-assistance bill that clears the way for enacting new trade agreements.
None of this means we’ve entered some new era of harmony in the capital; Republicans remain unswervingly opposed to any new taxes to reduce debt. And GOP leaders can push their rank-and-file only so far.
After conservatives on Wednesday defeated their leaders’ legislation that would keep the government running for the next two months, House Speaker John Boehner (R-Ohio) attempted to negotiate with House Minority Leader Nancy Pelosi (D-Calif.) in hopes of securing Democratic votes for the spending bill. But Boehner lost his nerve and decided instead to appease the recalcitrant conservatives.
Still, the shift in tone shows that Republicans have decided to pick their battles — a sensible response to the revulsion Americans felt watching this summer’s brinkmanship over the debt limit.
The Republicans seem to be heeding the advice of strategists such as Bill McInturff, a GOP pollster who, in a widely read memo earlier this month, warned that the debt standoff hurt consumer confidence much like the Iranian hostage crisis, the collapse of Lehman Brothers and Hurricane Katrina.
“The perception of how Washington handled the debt ceiling negotiation led to an immediate collapse of confidence in government and all the major players, including President Obama and Republicans in Congress,” McInturff wrote. He added that “this sharp a drop in consumer confidence is a direct consequence of the lack of confidence in our political system and its leaders.”
Fearing that voters will probably punish all incumbents — not just Obama — Republicans have softened their style in September, even as Obama has hardened his. “There is a recognition on the Hill that people are frustrated with Washington and want some results,” acknowledged Cantor’s spokesman, Brad Dayspring.
The Republicans’ experiment in conciliation has been aided by Senate Majority Leader Harry Reid (D-Nev.), who has brought up issues — patents, trade and transportation — that had bipartisan support from the start. But Democrats also claim some vindication in the new approach. As one Democratic leadership aide put it: “They’re picking their shots better so they don’t come across as complete [expletives].”
The question is: How much substance comes with that recalibration? After Obama’s address to Congress on job creation, Boehner replied with the conciliatory message that “it is our desire to work with you to find common ground.”
On the morning after his House conservatives defeated the legislation to keep the government running, Boehner went to the microphones to assure Americans: “Listen, there’s no threat of government shutdown. Let’s just get this out there.”
Privately, Democrats believe that, too. And though Obama’s jobs bill has no chance of passage (even many Democrats object to its tax increases), chances are good that Republicans will agree to extend the payroll tax cut and a tax credit for hiring wounded veterans.
“We want to join with our colleagues on the other side of the aisle, to find areas where we agree, to make sure the American economy succeeds,” Cantor announced via Twitter.
Well said. But how much will Republicans practice what they tweet?
The GOP’s Lies And ‘Monstrous’ Lies
In politics these days, there are lies, “monstrous lies,” and statistics. By lies I mean the mundane nonsense that dribbles out of politicians’ mouths when the facts don’t suit them or they just don’t know any better. By “monstrous lies,” if I can borrow the phrase of the moment, I refer to the grander deceptions swallowed by whole political movements, delusions and deceptions that infect larger issues of policy and worldview.
Statistics in this case, along with pesky facts, help expose and distinguish the two species of falsehood—both of which have been on dramatic display during the GOP presidential primary campaign.
Take, for example, Michele Bachmann, who is practically a walking, talking full-employment plan for journalistic fact-checkers. Appearing at last week’s Republican debate (sponsored by CNN and the Tea Party Express—does that mean that the Tea Party is now part of the lamestream media?), Bachmann repeated a favorite talking point, that the Constitution forbids states to mandate that their citizens buy health insurance, Romneycare-style. “If you believe that states can have it and that it’s constitutional, you’re not committed” to repealing the Affordable Care Act, she argued. But the conservative case against the healthcare law rests on the notion that because the Constitution does not explicitly authorize such a law, the federal government is barred from instituting one. Since the 10th Amendment reserves powers not delegated to the federal government back to the states, it is constitutional for, say, Massachusetts to require its citizens to purchase health insurance (or car insurance, for that matter). Bachmann’s stance, one blogger at the influential conservative blog Red State argued, is “either ignorance on display or dishonest pandering.”
Bachmann was even more egregious after the debate, when she went on Fox News Channel, and later the Today show, and asserted that Gardasil, the vaccine that Texas Gov. Rick Perry had tried to mandate for Texas schoolgirls, caused “mental retardation.” It’s such whole-cloth twaddle that even the likes of Rush Limbaugh (“she might have jumped the shark”) and the Weekly Standard (“Bachmann seemed to go off the deep end”) blasted her for it.
But Bachmann is literally and figuratively small potatoes, Perry’s arrival having returned her to the lower tier of GOP contenders. And she is minor league compared to Perry in the “monstrous lie” department.
The phrase of course comes from his memorable description of Social Security. “It is a Ponzi scheme to tell our kids that are 25 or 30 years old today, you’ve paid into a program that’s going to be there,” Perry said at his first presidential debate. “Anybody that’s for the status quo with Social Security today is involved with a monstrous lie to our kids, and that’s not right.” Elsewhere he has called the program “by any measure … a failure” and cited it as “by far the best example” of an extra-constitutional program “violently tossing aside any respect for our founding principles.”
It’s a catchy turn of argument, but one monstrously divorced from reality. His “failure” kept nearly 14 million seniors and 1.1 million children out of poverty last year, according to Census Bureau data. Here are the facts about Social Security: Without any modification, it will pay out full benefits for the next 24 years. Starting in 2035, its trust fund will no longer be able to pay full benefits. Instead it will pay roughly three quarters benefits through 2084, which is as foreseeable a future as anyone can peer into in these matters—a problematic future, but hardly a monstrous one and certainly not an impossible one.
Indeed, the Congressional Budget Office has produced 30 policy recommendations, some combination of which could fix the Social Security shortfall. Here’s one: Remove the payroll tax cap so that more wages are subject to the payroll tax. That would make the program solvent for the 75-year window—again, hardly a monstrous situation. (To put it another way, the Social Security shortfall figures to be roughly 0.8 percent of GDP—roughly the same as the cost of extending the Bush tax cuts over the same period.)
Social Security wasn’t the only topic this week of Texas-size Perry misinformation. Obama “had $800 billion worth of stimulus in the first round of stimulus,” Perry said. “It created zero jobs.”
This gem—a staple of GOP talking points—earned a “Pants on Fire” rating from PolitiFact, which pointed to several independent analyses that came to quite different conclusions. The Congressional Budget Office has estimated that the first round of stimulus created or saved between 1.3 million and 3.6 million jobs; HIS/Global Insight put the number at 2.45 million, Macroeconomic Advisers at 2.3 million, and Moody’s Economy.com at 2.5 million. The GOP may disdain jobs that come from public spending (recall Speaker John Boehner’s “so be it” comment when asked about budget cuts leading to fewer jobs), but they cannot seriously argue that the economy would be better off if the ranks of the unemployed were 2.5 million persons more swollen. So instead forgo the inconvenient truth in favor of the monstrous lie.
These lies are monstrous because they are not one-offs, but are central to the GOP case—that Social Security (except, they are quick to add, for those currently on it) and the stimulus plan don’t work. So they have real-world policy consequences—see the emerging conservative line of attack against Obama’s American Jobs Act, that it is a stimulus retread. “Four hundred-plus billion dollars in this package,” Perry concluded at the debate. “And I can do the math on that one. Half of zero jobs is going to be zero jobs.”
He may be able to do math, but his grasp on the facts is tenuous at best.
By: Robert Schlesinger, U. S. News and World Report, September 22, 2011
Obama’s Tax Plan Is Common Sense, Not Class warfare
“Class warfare!” scream the Republicans, in a voice usually reserved for phrases such as “Run for your lives!”
Spare us the histrionics. The GOP and its upper-crust patrons have been waging an undeclared but devastating war against middle-class, working-class and poor Americans for decades. Now they scream bloody murder at the notion that long-suffering victims might finally hit back.
President Obama’s proposal to boost taxes for the wealthy by $1.5 trillion over the next decade is a good first step toward reforming a system in which billionaire hedge-fund executives are taxed at a lower rate than are their chauffeurs and private chefs.
Republicans whine that, since they oppose raising taxes on the rich — and control the House of Representatives, which can block such legislation — Obama’s proposal should be seen as political, not substantive. This is just a campaign initiative, they say, not a “serious” plan to address the nation’s financial and economic woes.
But that’s pure solipsism: Whatever does not fit the GOP’s worldview is, by definition, illegitimate. By this standard, Obama could propose only measures that are in the Republican Party’s platform — which obviously would defeat the purpose of being elected president as a progressive Democrat in the first place.
Outside of the Republican echo chamber, polls consistently show the American people consider unemployment to be the nation’s most urgent problem, not deficits and debt. Obama was on target with the American Jobs Act he proposed this month; the only question was what took him so long.
Americans do have long-term concerns about debt, however, and by large margins they see an obvious solution: a balanced combination of spending cuts and tax increases. In other words, they want precisely the kind of approach that House Speaker John A. Boehner (R-Ohio) rejected during the debt-ceiling fight — and that he vows to reject again.
Why did Republicans begin squawking about class warfare even before Obama had a chance to announce his proposals? Because by calling on the rich to pay “their fair share” of taxes, the president has hit upon a clear and simple way to illustrate how unequal and unfair our society has become.
Since the beginning of the Reagan years, the share of total income captured by the top 1 percent of earners has doubled while the share taken by the bottom 80 percent has fallen. The rich are getting richer at the expense not only of the poor but of the middle class as well.
Studies demonstrating this trend tend to be dry and, let’s face it, sleep-inducing. But the perverse disparity in tax rates between the super-rich and the rest of us is enough to grab anyone’s attention.
The very wealthy earn much of their income through dividends and capital gains, which are taxed at 15 percent. This low rate would apply specifically to a wildly successful hedge-fund manager who made, say, $50 million last year. By contrast, an insurance company executive who made $500,000 — just 1 percent of what the hedge-fund manager took home — would pay a top marginal income tax rate of 35 percent. Even a teacher who made just $50,000 — 0.1 percent of the hedge-fund haul — would pay a top marginal rate of 25 percent.
Obama proposes tax legislation that would erase this disparity. He also vows that, unless Congress enacts comprehensive — and fair — tax reform, he will allow the Bush tax cuts for households earning more than $250,000 a year to expire at the end of 2012.
The overall plan that Obama announced Monday would cut deficits by about $4 trillion over the next 10 years — without gutting programs that bolster the middle class and aid the poor. New tax revenue and money saved from ending the wars in Iraq and Afghanistan make up most of the total.
Obama’s proposed savings in Medicare and Medicaid are modest and tailored so that their impact is progressive. The president correctly decided that ensuring Social Security’s long-term solvency should proceed on a separate track. All this should be heartening to those who really want to preserve these vital programs.
The headline from Obama’s plan, though, is the call for wealthy Americans to pay taxes like everybody else. If Republicans believe the current system is fine, Obama said, “they should be called out. They should have to defend that unfairness. . . . They ought to have to answer for it.”
We’ve already heard their answer.
And we’ve heard Obama’s retort: “This is not class warfare. It’s math.”
By: Eugene Robinson, Opinion Writer, The Washington Post, September 19, 2011
It’s Not About Job Creation Stupid!: I Am A Job Creator Who Creates No Jobs
I am a job creator.
I am not a job creator in the sense that I actually create jobs. I have never knowingly created a job, and my long-term business plan, approved unanimously by my board of directors, does not call for the creation of a single one.
But I am a job creator in the sense Republicans mean when they say “don’t tax our job creators more” (House budget committee Chairman Paul Ryan) or “we cannot increase taxes on the job creators” (House Speaker John A. Boehner). This is because, in the eyes of the government, I am a small business — and, as the House Republicans liketosay, “small businesses are the job creators.”
Like the overwhelming majority of small businesses, I am a one-man operation. And, like most small businesses, I would not hire anybody even if the government dropped my tax rate to zero.
According to Small Business Administration statistics, based on 2009 Census data, 21.1 million of the 27 million small businesses in the United States are “non-employer firms,” which have no workers other than the owner. Of those, 18.7 million are “sole proprietors,” 950,000 are partnerships and 1.4 million are corporations, like me.
When lawmakers talk about small businesses as the engine of growth, they bring to mind entrepreneurs building start-ups from their garages. But when officials talk about protecting the “job creators” from tax hikes, they are mostly protecting a bunch of doctors, lawyers, freelancers, contractors and the like.
On the advice of my accountants, I formed a “C corporation,” which means that, as a legal entity, I am pretty much the same as General Motors and Google. But I run a lean operation. While my business, Ink-Stained Inc., produces the occasional book, TV appearance and speech, it is probably not going to win any best-practices awards.
Disagreement is rare during board meetings at Ink-Stained Inc. world headquarters (my house), because I am the chairman, chief executive, president, treasurer, secretary, chief technology officer and mail-room clerk. Occasionally board members complain about environmental regulations, not because these regulations affect us but because that is what we have heard corporations are supposed to do.
We administer a modest pension plan for our sole employee, and we reimburse a few health-care expenses. We have big, professional-looking checks, and we attempt to keep our accounts balanced, although our chief financial officer (also me) is a lagging performer. We once considered hiring our wife as a consultant to help us organize our finances, but the HR department was unable to come to terms with her. We have so far repelled all attempts at unionization.
I should add that I am in no danger of being caught in the net of President Obama’s proposed millionaires’ tax. I pay the accountants a few thousand dollars, and they make sure I am not paying more in taxes than I should be. (Note to the IRS: They do this in ways that are conservative, entirely above-board and so innocuous that they should not attract your interest in the slightest.)
While there is something absurd about being a one-man corporation, it’s a rational response to an irrational tax code. If lawmakers got serious about tax reform that removed loopholes, the money spent on accountants and actuaries (valuable though they are) could instead be used to grow the economy or to pay the federal debt. But that’s a matter for another day.
At the moment, the Ink-Stained Inc. case study, should the Harvard Business School wish to study it, is a reminder to be skeptical of the “job creator” argument in the tax debate. “It’s a good example of the murkiness of what we mean by small business and the connection to jobs,” William Gale, co-director of the Urban Institute and Brookings Institution’s Tax Policy Center, told me. “There’s sort of this notion of small-business innovation and job creation that just doesn’t necessarily hold.”
That’s even more so with Obama’s “Buffett Rule,” under which millionaires would have to pay a higher tax rate than a typical middle-class worker. As a practical matter, most already do. Gale said the rule would raise the taxes on only a few thousand people, perhaps as few as 1,000.
In a nation of more than 300 million, that’s not going to make a dent in job creation. Even the data analysts at Ink-Stained Inc. could figure out that one — that is, if we had any data analysts.
By: Dana Milbank, Opinion Writer, The Washington Post, September 21, 2011
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