So the really big fight -- perhaps the defining battle of 2012 -- won't be over Medicare. It won't even be over Obama's jobs program.
It will be over whether the rich should pay more taxes.
The president has vowed to veto any plan to tame the debt that doesn't increase taxes on the rich. The Republicans have vowed to oppose any tax increases on the rich.
It's a good fight to have.
In a Rose Garden ceremony this morning, Obama proposed new taxes on the wealthy -- including a special new tax for millionaires, the closing of loopholes and deductions for people making more than $250,000 a year, and an end to the portion of the Bush tax cut going to higher incomes.
Republicans accuse the president of instigating "class warfare." But it's not warfare to demand the rich pay their fair share of taxes to bring down America's long-term debt.
After all, the richest 1 percent of Americans now takes home more than 20 percent of total income. That's the highest share going to the top 1 percent in almost 90 years.
And they now pay at the lowest tax rates in half a century -- half the rate they paid on ordinary income prior to 1981.
(Unfortunately, the President isn't proposing to raise the capital-gains tax -- which, now at 15 percent, creates a loophole large enough for the super-rich to drive their Ferrari's through. About 80 percent of the income of America's richest 400 comes in the form of capital gains. Here's where billionaire hedge-fund and private-equity fund managers make out like bandits. As I've noted, I also wish he aimed higher -- for more brackets and higher rates at the very top. But at least he's drawn a line in the sand. The veto message is clear.)
Anyone who says the American economy suffers when the rich pay more in taxes doesn't know history. We grew faster the first three decades after World War II than we have since.
Trickle-down economics has been a cruel joke.
On the other hand -- given projected budget deficits -- if the rich don't pay their fair share, the rest of us will have to bear more of a burden. And that burden inevitably will come in the form of either higher taxes or fewer public services.
If anyone's declared class warfare it's the people who inhabit the top rungs of big corporations and Wall Street (and who comprise a disproportionate number of America's super rich). They've declared it on average workers.
The ratio of corporate profits to wages is higher than it's been since before the Great Depression. And even as corporate salaries and perks keep rising, the median wage keeping dropping, and jobs continue to be shed.
You've got the chairman of Merck taking home $17.9 million last year. This year Merck announces plans to boot 13,000 workers. The CEO of Bank of America takes in $10 million, and the bank announces it's firing 30,000 workers.
Maybe I'm old-fashioned, but the way I see it we've got a huge budget deficit and a giant jobs problem. And under these circumstances it seems to me people at the top who have never had it so good should sacrifice a bit more, so the rest of us don't have to sacrifice quite as much.
According to the polls, most Americans agree.
Robert Reich is the author of Aftershock: The Next Economy and America's Future, now in bookstores. This post originally appeared at RobertReich.org.
Follow Robert Reich on Twitter: www.twitter.com/RBReich
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Water wars with cities vs. crops vs. water for processing oil out of shale. Food is made out of water and soil. Weather changes reduce crop yields. America's economy depends on food exports. That has covered the cost of importing goods and borrowing.
Obama has more deregulators everywhere. His own party cannot stop him.
Economist and Professor Micheal Hudson calls it a "lost decade." 13 trillion in bailouts has not trickled down. 70 is consumer spending. Obama should have renegotiated the real estate loans by reducing principal to market. The debt overhead is creating a permanent depression. The crash wiped out debts and savings but this time, the people were taxed to bail out the banks.
The economy will shrink in "debt deflation." People earn an income and buy goods and services AFTER paying their debt on mortgage and loans. When the banks get money, they don't buy goods and services. They lend it out or invest it. More and more goes to the financial sector.
B of A is a Rico. Holder will not prosecute.
True to form, the Tax and Spend Party is living up to its name once again...might I add going to extremes never before seen. Madness.
A quote from the report:
"... ideological subgroups failed to update their beliefs when presented with corrective information that runs counter to their predispositions. Indeed, in several cases, we find that corrections actually strengthened misperceptions among the most strongly committed subjects."
Faith based politics is the norm because thinking is hard.
When Republicans still believe the biggest lie of all, that they are the party of small government, how can you expect to disabuse them of all the other lies they believe in?
If the facts are telling us something that is in conflict with our beliefs, perhaps you need to adjust your beliefs.
An intelligent citizen will, a Republican will not
http://www.usgovernmentspending.com/federal_deficit_chart.html
Debt to GDP from beginning to end of administration.
+0.1% Nixon/Ford
-3.2% Jimmy Carter
+20.5% Ronald Reagan
+13.1% George H. W. Bush
-8.8% Bill Clinton
+28.6% George W. Bush
If you look at what happened to the American budget over the last 20 or 30 years, the culprit is obvious. We have dropped corporate taxes. We have dropped taxes on the rich.
If you go back to the 1940s, here’s what you discover, that the federal government got 50 percent more money year after year from corporations than it did from individuals.
For every dollar that individuals paid in income tax, corporations paid $1.50. If you compare that to today, here are the numbers.
For every dollar that individuals pay to the federal government, corporations pay 25 cents.
That is a dramatic change that has no parallel in the rest of our tax code.
What’s the alternative? Well, we don’t have to look far. Roosevelt, in the 1930s, the last time we faced this kind of situation, went on the radio in 1933 and 1934, and he gave speeches. And in those speeches, he said the following: if the private sector either cannot or will not provide work for millions of our citizens, ready, able and willing to work, then the government has to do it. And between 1934 and 1941, the federal government created and filled 11 million jobs.
This was a quarter century ago. Don't you think we might have improved at least something in the last generation?
Taxing the rich, if that is really the plan, should save and expand Social Security, Medicare and Medicaid, not cut them up. Enacting a tax on capital gains, stock, commodity and derivative trade would create a tax revenue bonanza. All proposals regarding the budget / jobs plan are specious, furthering the economic collapse via mind mangling offensive against the US population; since the origin of our crisis, the bailouts, the monetary financial system, are not addressed and our economy continues to be pillaged.
This President, this fascist Super Congress, can not be supported. There is no economic recovery while the Administration, the Congress, the Fed, et al, are operating to perpetuate the monetary financial system while exposing the population to the continued destruction of the national economy.
Stop the bailouts, recover the bailout trillions, implement the Glass-Steagall standard in US banking, cancelling all obligations to the Inter Alpha Group of Banks, the Wall St. cabal. Create the US national bank that funds the 50 states, then fund the necessary facilities that enhance the population's physical economy. Stop Perpetual War, or economic recovery is impossible. No other options exist.
Of course, its often poor decision making and a desire for the short term profits by the same King that caused the eventual soft sales and profits.
Do you really think it was a $40K clerical worker at B of A that said, yes lets give a bunch of mortgage loans out to people who won't be able to repay them.
Income taxes are just one form of taxes.
Choosing to focus on just one form of tax is, at best, cynical and deceitful
Basic tax fairness is that people making the same level of income should pay the same rate of taxes.
It turns out that poor people pay a higher rate of taxes on their total income than do rich people.
They pay payroll taxes, property taxes, sales taxes, etc.
In comparison, speculators (financial gamblers) only pay 3/7ths what a working person pays.
Furthermore, corporations and individuals making millions get all sorts of tax expenditures (givebacks) to enhance their lives (like freebies on corporate jets).
Fair share? Really?
Obviously, at this point, most of us have more than we need to survive, but some of us have lost a good bit of what we had and are in danger of losing more of it. We are protective of our wealth because we made some effort to acquire it, and in many cases we worked at jobs and in conditions that were sacrificial in order to provide for our families and our futures. We did not gamble on Wall Street or sell them mortgages they couldn't afford. Then our government took money and gave it to the wealthiest so that they would not have to suffer the consequences of their unbridled greed.
Therefore, we now think that it is time that the wealthiest who were spared by government intervention step up and put some more money into the system so that the government can spend it on things that benefit all of us.
The one thing which united this incredibly disparate group of people was their religious belief. Never, ever discount private faith as a political motivation.
Note he said sacrifice more, I thought his whole argument was " fair share ".
Well, he sorta sucks at his job, actually, and isn't worth one firefighter, or one teacher, or one fry cook, for that matter.
http://www.youtube.com/watch?v=NzspsovNvII&feature=related