Who Won the November Elections?
Judging from what has been happening with our government since the November elections, the answer to this question is far from certain. The results of the fiscal negotiations to this point are far from promising in terms of bringing about greater economic equality in this country anytime soon.The main belt-tightening aspect involved returning payroll tax rates to the level they were at two years ago, largely affecting those nearest the bottom of the income ladder the most.Republicans in Congress screamed bloody murder at not being able to lower tax rates on the ultra-wealthy back to their levels under the Bush tax cuts, and vow that further revenue increases will be off the table.
Taking further revenue increases off the table in future debt reduction negotiations is a ludicrous position to take for several reasons. To this point, almost all deficit reduction efforts during the Obama administration have involved spending cuts. Revenue increases don’t even come close to approaching those envisioned by the Simpson-Bowles Commission or even the President’s initial proposal. Tax inequities resulting in such skewed income/wealth inequality in this country pre-date the Bush tax cuts and haven’t even begun to be touched in this process. Continuing this deadline-defying tap dance the GOP in Congress have been leading over the past couple of years obscures this fact and prevents real tax reform from taking place.
In order to protect the ability of their wealthy and corporate benefactors to escape paying their fair share of taxes towards maintaining and improving our society, they are calling for austerity cuts in the social safety net programs that they deem to be “entitlements” like Social Security, Medicare and Medicaid. Expenditures in these programs are increasing dramatically along with our aging population and rapidly rising health care costs.However, none of these programs is currently insolvent, and many of the issues involving the health care costs are in the process of being somewhat alleviated by the Affordable Care Act reforms that are still not entirely in place.
Calling these programs entitlements is reminiscent of Romney’s famous 47% speech which implied that those who don’t pay Federal Income Taxes feel they are entitled to be supported by the government without pulling their own weight. We all know how well that worked for him, but the idea is still out there and in use by many on the right of the political spectrum. Never mind that the real takers in this society appear to me to be those individuals and corporations taking advantage of tax loopholes and shelters to amass huge fortunes they can then squirrel away in foreign tax havens to benefit mainly their own families and/or corporate executives. Contrary to conservative economic theories used to create these tax schemes, much of this money gets taken out of the economy, rather than used to increase demand and “trickle down” by creating jobs and plenty for all.
Rather than waiting until a week before a big deadline to hear what the leadership hammers out in a back room somewhere and then voting on a done deal, I wish there were more elected representatives with staffs willing to work on alternative solutions to the very limited ones that seem to continue to circulate among the leadership and the mainstream media. It took some hard work and smart minds to devise these policies that have resulted in such unequal distribution of the bounty of our nation. I’m sure there are more than sufficient human resources available to sort through how to undo those inequalities. Refusing to come to an agreement which will afford the flexibility and time to sort out the most effective means of achieving our goals as a society is, in my view, a violation of the oath of office each elected official takes when they are sworn in, and should be acted upon accordingly at the time of the next election at the very least.
By saying that the only solution to the deficit spending is to cut the spending going towards meeting the real needs of the most vulnerable members of our society without looking to the least needy to contribute more – in a way that does not appreciable degrade their own standard of living – we would be negligent in our responsibilities as compassionate human beings. Would taxing capital gains on a par with income paid in the form of wages or salaries to offset foregoing a negative change in how cost-of-living adjustments are made to Social Security benefits be too much to ask? No. I’m not saying the numbers add up directly on this example, but it is one example of the sort of discussion that should be going on in DC.
Does a 1% or 2% or 5%.difference in after tax income mean as much to a billionaire as it does to a middle class employee or a retiree dependent upon his or her Social Security check to make ends meet? I don’t think so. Neither do many billionaires, for that matter. Yet many of elected representatives would rather see more people switching from hamburger to cat food and going an extra two years without adequate healthcare than take away any corporate welfare or tax advantages that only wealthy people can even take advantage of. This does not even address the issue of whether or not anybody can ever “deserve” to be either a millionaire or homeless.
Romney seems to me to have won the election to a certain extent, if the debt/deficit discussion continues along the lines that have been drawn so far by the Administration and Congress. He got away with something that nobody seeking to lead this nation should ever be allowed to get away with again – not releasing detailed tax returns. I do not know if he is hiding any illegalities. Probably not. However, just imagine how the discussion would have gone about the exact methods he used to shelter income in such a way as to avoid paying as high a percentage of it in taxes as a person making less than 10% of what he made? There are undoubtedly those in the tax accounting community who could describe quite well how this takes place. It speaks volumes that when he released the little information he did about his 2011 tax liability, Romney had to forego a multi-million dollar charitable deduction in order to raise his taxes to a less eye-raising percentage of his total income.
Warren Buffett, one of of the richest people in the world, thinks it is ludicrous to have a tax system that permits him to pay a lower percentage of his income in taxes than his secretary does, and has proposed some ideas to rectify that. Notions that people will volunteer to pay more out a sense of fairness without being forced to by changes in tax codes are laughable. Before we start taking an axe to some of the most important social programs our government has put in place, we need to explore more equitable ways of paying for them, as well as areas of lesser importance to cut in the future. Most retirees living on Social Security using Medicare for their health needs neither use tax shelters in the Caiman Islands or Switzerland nor offshore jobs to China.