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Robert Reich

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An Offer to the President

Posted: 12/14/11 05:48 PM ET

Mr. President, we heard what you said last week in Kansas -- about the dangers to our economy and democracy of the increasing concentration of income and wealth at the top.

We agree. And many of us are prepared to work our hearts out to get you reelected -- as long as you commit to doing what needs to be done in your second term:

-- Raise the tax rate on the rich to what it was before 1981. The top 1 percent has an almost unprecedented share of the nation's wealth and income yet the lowest tax rate in 30 years. Meanwhile, America faces colossal budget deficits that have already meant devastating cuts in education, infrastructure, and the safety nets we depend on. The rich must pay their fair share. Income in excess of $1 million should be taxed at 70 percent -- the same rate as before 1981.

-- Raise capital gains taxes to the same level. It's absurd that the 400 richest Americans -- whose wealth exceeds the wealth of the bottom 150 million Americans put together -- should pay an average 17 percent tax on their incomes, the rate day laborers and child-care workers pay. That's because so much of the income of the super-rich is considered capital gains, now taxed at only 15 percent. Close this loophole.

-- Tax financial transactions. A tiny tax on every financial deal would yield billions of dollars more. It would also slow speculators and reduce the wild gyrations of financial markets.

-- Use the bulk of this money to create good schools, give our kids access to a college education, and build a world-class infrastructure, so all our children have a chance to get ahead.

-- Resurrect the Glass-Steagall Act, that used to separate commercial from investment banking. It was put in place after the Great Crash of 1929 to prevent financiers from gambling with peoples' bank deposits. But it was repealed in 1999 -- and its repeal contributed to the Crash of 2008. Wall Street lobbyists have made sure the new Dodd-Frank law has enough loopholes to allow financiers to continue to gamble with other peoples' money. The only way to stop this is to bring Glass-Steagall back.

-- Cap the size of Wall Street's biggest banks and break up the biggest. They were too big to fail before the bailout. They're even bigger now. And because of their huge size they get preferential treatment from the Fed, giving them an even greater competitive advantage over smaller banks. Cap their size and break them up before we have to bail them out again.

-- Require the big banks that got bailed out to modify the mortgages of millions of Americans now under water, who owe more than their homes are worth. It's not their fault the banks created a housing bubble that burst, causing home values to plummet.

Mr. President, we know nothing good happens in Washington unless good people outside Washington are organized and mobilized to make it happen.

So here's the deal: We'll reelect you. We'll stand behind you. We'll give you a mandate to do all this -- and more -- in your second term.

As long as you stand behind us.

Deal?

Robert Reich is the author of Aftershock: The Next Economy and America's Future, now in bookstores. This post originally appeared at RobertReich.org.

 
 
 

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Mr. President, we heard what you said last week in Kansas -- about the dangers to our economy and democracy of the increasing concentration of income and wealth at the top. We agree. And man...
Mr. President, we heard what you said last week in Kansas -- about the dangers to our economy and democracy of the increasing concentration of income and wealth at the top. We agree. And man...
 
 
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11:09 AM on 12/17/2011
If you have not already done so I would strongly recommend you read Mr. Reich's most recent book. Not only does it clearly outline the problems facing America but also provides a solution to the problems. It's a very good starting point.
12:08 PM on 12/16/2011
Very good article Mr. Reich. If you would put your article on The White House website as a petition, I will sign it.

If anyone else thinks a petition is a good idea, please mark my comment as a favorite. Thanks.
11:59 AM on 12/16/2011
I'm with this, Dr. Reich!

We must hold him to this. If we can hold him to this, then the Green Party threat won't be a threat either. But for now, I see the Green Party candidate as a good tool to push Obama to hold this line. If he does, people like me won't vote Green, we'll vote Obama.
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marthamothra
10:55 AM on 12/16/2011
Excellent -- the way. Nothing more to be said.
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Peter007
10:16 AM on 12/16/2011
Take from the rich and give to the poor.

Make sure the middle man gets a percentage.
12:24 PM on 12/16/2011
Peter007,

Your remark is foolish. Wealthy people have a lifestlye that perpetuates itself because they can use their influence in Congress, with Presidents, with the heads of government agencies, with lobbiests and with corporate executives and corporate boards of directors.

In other words, the wealthy get preferential treatment. Also, the wealthy attempt to limit competition, "bend " laws to their advantage, use tax shelters, and sometimes even break laws in order to become more wealthy.

You should do some research on how many executives in the oil and gas industry make more than $1,000,000 per year. Do they deserve it? Does anyone deserve a million dollars a year in compensation?
09:58 AM on 12/27/2011
You are 100% correct that the wealthy always get preferential treatment by politicians. That is why we should limit the power of the politicians. Lower taxes and allow the court ssytem to regulate rather than the poiticians limits the power of the politicians to exchange favors for money.
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Hikerguy22
Celebrate the end of Big Oil and Coal; and Meat?
10:10 AM on 12/16/2011
With the passage of the defense act, Obama has shamed our constitution and shown that he has little fight in him against the power of the rich and the congress who supports them. They have their grips around the Americans necks and are surely choking us to a slow death.
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Si1ver1ock
So long, and thanks for all the fish...
12:04 PM on 12/17/2011
Obama is sending mixed signals. Can we trust what his lips say? Do we have a choice?
06:56 AM on 12/16/2011
Great letter from Reich...Just DO IT !
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Coyote50
"Taxes are the price we pay for civilization."
02:13 AM on 12/16/2011
I'll sign on for this deal!
01:48 AM on 12/16/2011
Hard to dispute the facts Reich presents. The real question is whether Obama can convince the voters he is serious about bringing about Reich's requested reforms. If not, get ready for Depression II.
01:13 AM on 12/16/2011
I agree with Reich. The Kansas speech was inspiring and much more than President Obama has given us reason to hope for. After three years of disappointing and/or even failed leadership in so many of the goals that were of great importance to us, can Obama be trusted to step up and do the right things, if elected?

The last few days of Obama's performance, I was beginning to believe perhaps he has learned and he is ready to stand up and lead with the bully pulpit. Peerhaps President Obama has a "fire in his belly" and will take on the Republicans.

Today, December 15, we learned that "1 in every 2 Americans live in poverty and low incomes'! The majority of these are children! Outrageous! On this same day, we learn that the Democrats have agreed to drop demands for a surtax on millionaires for the Republicans to support a $1500 payroll tax benefit and unemployment extension for 150 million middle class! It's just been about a week or 10 days since Kansas and they're back to "a movable line in the sand"!

Was Obama's speech just a good campaign speech? The President hasn't listened to his base of supporters for three years. If the Kansas speech was just campaigning, he'll miss a chance to right this boat and change his legacy. As one of the 99%, I know we're not walking away, we will turn it around with or without him!
claraluz
Per aspera ad astra!
11:57 AM on 12/16/2011
So what is he supposed to do? You would be screaming if the payroll tax benefit and the unemployment benefit extension were not passed. The House has the upper hand, and majority in the Senate is very small -- also, clearly there are a few Democrat senators who are leaning way right (haven't had to time to look up the traitors to see if they're from the South). Right now compromise is the only way this train is going to move. If the Teabaggers lose the house, there may be some hope...
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10:36 PM on 12/15/2011
Is the average IQ still somewhere around 100? Are we going to grant EVERYBODY a college degree? How does that help our society? Based on what I pay at the garage, being a mechanic is not such a bad thing, and we could surely use more of them...
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Coyote50
"Taxes are the price we pay for civilization."
02:14 AM on 12/16/2011
And what's wrong with mechanics having a college degree? Everybody can use an education!
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Peter007
10:18 AM on 12/16/2011
It's a waste of money unless the mechanic is independently wealthy and can afford to throw away $100,000 so he can party for 4 years.
claraluz
Per aspera ad astra!
11:59 AM on 12/16/2011
Especially in view of the fact that modern cars and engines are complicated electronic machines, not something that you can fix with a screwdriver and a pair of pliers as in the past.
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Coyote50
"Taxes are the price we pay for civilization."
05:47 PM on 12/16/2011
Wow - do you have low expectations about people based on your post below, which I can't return a comment on. Look at the Scandinavian countries. They provide education to everyone. They have much more civilized societies. People there work - yes they do! They are not perfect, but they are getting there much more quickly than we are. Partly because people like you are willing to accept things as crappy as they are. You're willing to accept the growing inequalities and the trashing of our country by corporations. I feel sorry for you. Maybe you should travel and read more and see what is possible. We don't have to live this way. We could be a better people if we were more thoughtful and educated.
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06:53 PM on 12/16/2011
On the contrary, I expect the average person to be just that. The disagreement I think we have is not whether education is, generally, a good thing, it is about who pays for what and whether or not there are diminishing returns.

You don't know anything about me. I am to the left of Marx on many issues, but it's my belief that those with extreme viewpoints have an obligation to keep one foot in reality. I don't believe our education budget is or ever will be bottomless.

I think a debate about publicly funded higher education is hopelessly out of place in a society where the school dropout rate is nearly 10% - closer to 20% for some minorities - and the public schools graduate the functionally illiterate. Reestablishment of a working public education system and a public system of trades education rank a lot higher on my list than free Philosophy degrees for all.
10:22 PM on 12/15/2011
how bout a WHOLE NEW PARTY or two.........ALL the Repubs and Dems have WAY outlived their usefulness and WAY overstayed their welcome in the American political system. How bout a generic 'OnlyWhatsGoodForThePeople' party. Our founders didn't fight and die to create the the best system on the planet just to have the current bunch of clowns spit all over their good work. Shame on EVERY SINGLE one of them
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Si1ver1ock
So long, and thanks for all the fish...
12:15 PM on 12/17/2011
Lack of funding and most people don't care. You could probably get round the lack of money but even now, the majority of the American people are oblivious. Politics just doesn't pertain to them.

The amount of wealth the 1% control is truly formidable. They own and control most of the money, media, judges, congressmen, governors etc. As time goes by they will consolidate even more. It is like the last stages of a monopoly game.
09:14 PM on 12/15/2011
Liberal/progressives continue to harken back to the days when the top rate on income was over 70%! How fair is that? We could go back to the days when there was no income tax. Today we have a bloated government with all sorts of insane ways to spend the tax dollars faster than they can come in. There may not be as many jobs as there was a few years back - but we also have fewer 'skilled' people. All those liberal arts degrees. How many times was there was an interview of an OWS idiot, did we hear that they were an unemployed artist! Give me a break. Maybe we can think Jimmy's Carters Dept lot Education for some of it. I wonder what value/wealth creating skills Mr. Reich is teaching his students at UC Beserkly? Maybe more professional complainers.
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cmaurand
08:30 AM on 12/16/2011
Yep, no income tax. That's a great idea. We could go back to children working in the mills and dying of tuberulosis. How about poor farms and indentured servitude? How about 60 hour work weeks with no overtime and slave wages? How about unsafe working conditions? How about the Mississippi river being an open sewer filled with industrial waste? How about us all choking on the pollution in air. We've been there, we've done that. How about people dying on the streets because they have no access to healthcare...wait, we still have that. We've got the t-shirts. We can't go back to those conditions, not ever.
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Peter007
10:19 AM on 12/16/2011
Your comment doesn't make any sense.
Using your logic, if we raise the tax rate to 80% then the world would fall into a world war 3 like we had when rates were that high.
12:24 AM on 12/17/2011
How about a 'flat' tax with a consumption tax. The rich folk that have more, will consume more and therefore will pay a bigger share of the taxes and maybe part way satisfy the progressive approach of taxing the guy behind the tree. This way everyone has a stake in the game. As for me, leave me alone and take your hand out of my pocket!!!
claraluz
Per aspera ad astra!
12:09 PM on 12/16/2011
NO income taxes? Have you considered that the taxes are not used only to provide assistance to the needy (which apparently is such a horrible burden for the resentful regressives) but also to support public services like libraries, national parks, the military, state universities, public transportation..space exploration... scientific research.... The main cut in public spending of our taxes I would support is cutting in half the salaries of our congressmen and senators, drop all their perks and let them fight on the free market for health care, and cut by 70% the salaries of the Supreme Court. That wold probably take care of several college degrees, I would think.
09:01 PM on 12/16/2011
It is all about balance. I don't consider myself a resentful regressive. I do think, however, that there are a lot of resentful 'progressives' with a touch of envy. Heard a lot of that from the OWS idiots. A FLAT tax coupled with a consumption tax would be more 'fair' and that way everyone would have some stake in the game. That is not the case now with 47% of the populace paying no Income tax. They are helping to vote for a bloated government and so some of your ideas for cuts have merit.
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TomDegan
Author of "The Rant": http://www.tomdegan.blogspot
08:22 PM on 12/15/2011
Robert Reich for President

The Democrats in general - and President Obama in particular - would be foolish to try and capitalize on the rage of the national Occupy movement. If they had bothered to remember a long time ago that they are (or were) the party of Franklin Delano Roosevelt and had had the guts to stand up to the right wing extremism of the last three decades, we probably wouldn't be brow-deep in the economic quagmire we find ourselves in today. That worthless party is within five years of finding themselves where the Republicans are today; beyond redemption. If they know what's good for them they'll clean up their act - pretty damned quick. They have got to stop nominating these pathetic, right wing Blue Dogs. Otherwise, within the next five years a new party will emerge from the wreckage of their incompetence and indifference.

This week the spokespersons for the plutocracy have been predicting the end of the movement which is now engulfing the world. The joke's on them. I really hate to be quoting the Carpenters here but Frank Zappa doesn't have anything apropos for this particular moment: "We've only just begun".

See you at the occupation, kiddies!

http://www.tomdegan.blogspot.com

Tom Degan
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mjc
Avoid printing any..
07:42 PM on 12/15/2011
Can't argue with any of your positions, Mr. Reich, but why hasn't this man who is the Democrat in the White House taken on these positions himself? What has happened to his earlier stance on constitutionality, on a fair shake in re taxation, etcetera? What's more, now that we are again approaching a governmental shutdown, Obama's administration has given up on protection of basic Constitutional rights, shredding habeas corpus in favor of making sure there are no terrorists getting away with...you name it, and the conservatives can fill it in. Perhaps he was meant to be the Republican president...in liberal clothing? and we were all just completely fooled. But the Republicans have little to fear from any of his positions or his policies in place.