1.) Fiscal Responsibility: Balancing the budget of the United States benefits the country as a whole, not just a selected few. This benefit manifests itself in
– Lower interest rates from less government borrowing and
– More domestic investment because government debt is not crowding out private capital.
2.) Responsible Taxation: Those who have benefitted from the policies of the US should pay their fair share of taxes to support the country as a whole. This does not mean we will tax you into oblivion. It does mean we will ask you to contribute. As a general guide, recent evidence suggests the “sweet spot” for the highest marginal tax rate is between 35-40%. Considering the rich freely use the freeway system, airports, court system, police and fire service and routinely boast about American military superiority, it is only fair they help to pay for these services.
3.) Financial markets will be honest, have integrity and provide a level playing field for all (thanks Mr. Spitzer).
4.) We will work to develop high-paying jobs. This means
– The government will work with business in a partnership to develop promising new technologies.
-Work with educators to provide the necessary skills for these jobs.
– This also means the work force must make a commitment to lifelong education.
Sounds good.
One argument I’d like to hear made more often:
The rich always tout how we can’t possibly tax them (or capital gains, etc) because “they create jobs”.
Well, I respect that. I’d like them to respect the fact that without a good transportation system, their ‘job producing businesses’ couldn’t:
In other words, aside from inherited wealth, most/all wealth comes from enjoying the benefits of living in this nation. And all wealth not earned through direct labor relies on the govt’s support of all the people who work for the companies that generate the non-labor wealth.
So yes, we “owe” them for the “jobs” they create. They owe us for the opportunity to earn money off those jobs. If I live by subsistence farming my backyard, the govt is supporting me to the tune of one person’s worth of services and protection. If I lived off my retirement income from investments, the govt would be supporting me to the tune of myself + a fraction of all the folks who contribute to the earnings of the companies that make up my investments, and all the middle-men between them and my portfolio.
So, ironically, a person earning a living off ‘capital investments’ may require much more ‘govt services’ than the poor schlep who does his 9-5.
And who’s the one always crying about “paying more than his fair share?”
I intended to make a similar comment… so I will!
Bonddad can tell us more about the famous ‘multiplier effect’ in capital, but we rarely hear about the related multiplier effect of infrastructure. You’re typical anti-tax cretin will argue against a progressive tax for something like education, or highways, or other bits of social or physical infrastructure, claiming that the rich guy and the laborer can each only drive one car, so why should the rich pay more for the roads. I would argue that the higher up on the economic food chain you sit, the more you benefit from the infrastructure. If the strata are:
. Working for yourself
. Having other people work for you
. Having your money work for you
. Having other people’s money working for you
It should be clear that the livelihood of the factory worker depends on his ability to drive to the factory. The factory owner relies on the roads for each of the workers, not to mention moving raw and finished materials. The investor depends on an even wider net of infrastructure-supported entities. And so on.
While I’m ranting, I’d also like to see something about the minimum wage go into the economic platform. I think we need aggressive education about it, since it not only appeals to a huge demographic, it should also make economic sense for everyone. Minimum wage earners, and those whose wages are linked to the minimum are not at liberty to save or squander their ‘raise’. Rather that money generally gets spent right away, going into the economy directly and circulating more quickly that the billions Bush has handed out to his investor-class supporters. They, like the ‘job-creators’ do not invest in america, or hire workers because they have extra money, they do it because they think they can earn more money. They don’t need incentive to do this, and incentives given won’t convince them to make bad investments. We need to reverse the incentive argument from trickle down economics, to growing the middle class to help all classes.
And then there’s security. If one got property insurance, one would expect to pay more to insure a mansion filled with precious objects than a tenement without a TV. In the same way, the protection the government provides through police and courts should cost more for those who have more.
And we can use a quote from a Republican hero to make our point:
For other ways of using Teddy to our advantage, see my diary HERE.
As a general guide, recent evidence suggests the “sweet spot” for the highest marginal tax rate is between 35-40%.
Sweet for what?
Does this rate maintain the upper classes roughly at the same wealth level beyond the middle and lower classes as they are today; or allow them to gain agains the rest of us at some pace; or allow the rest of society to gain on them?
Is there any kind of agreement on how much more wealth the rich should have than the middle & lower classes, or what fraction of the total population’s wealth is ideal for the rich to own?
I’m not comfortable with arguments about how much of the wealth a certain percentage of people should own.
However, I do think people of wealth should contribute fairly to the common good.
While I would be very hesitant to draw exact lines, I think it can be safely said that the wealth disparity/concentration in a society hos a direct impact on how free that society is. I think it’s a truism that money — and more broadly, wealth — is power. While one might be able to speculate about a society where that might not be true, it’s certainly true in this one. So a disparity of wealth is inherently a disparity of power.
Concentrating that power in a relatively small group of people can — and in our context clearly does — warp other societal structures.
While I’d be extremely reluctant to put specific limits on wealth disparity and/or concentration, I do think that — at minimum — we need to study and correct the effects that disparity has on the structures that are supposed to serve individual and community freedoms. I think it’d also be worth studying and possibly (very carefully!) tinkering with the various things that feed into making it generally easier to make money if you already have money.
A rising tide may lift all boats, but how much good is that when a few people in yachts control the resources and facilities needed to build boats? If you can’t afford to buy a boat from them, a rising tide just means that you’re in farther over your head. (Sure, sure, swim for the beach … which is probably controlled by a resort corporation and patrolled by security types who are rather less polite to you than they are to the paying guests.)
Should we have planks addressing health care and housing too? Since you went to the trouble to write up all those diaries.
Health care is a seperate issue, even though it does have strong economic underpinnings.
Housing is also seperate.
The point of this was to get a few simple strairforward points. Nothing more.
Michael Mandel has a post about the politics of deficits. I tend to agree with some of his reasoning:
Now, I would modify that by saying that the Bush budgets are so out of control that there will have to be some fiscally responsible tax increases. And, the unsustainable Bush budget is an excellent anti-corruption “reform” issue.
The goal should not necessarily be to zero out the budget deficit, however, but rather, as Max Sawicky has proposed, to stabilize the ratio of debt-to-GDP, which is a sustainable long-run budget policy, and leaves more room for doing something about jobs, education, and health care.
is that everyone in this country needs to pay their fair share, and that includes corporations. Incentives for corporations to take assets overseas need to be eliminated. To cite perhaps the most egregious example, the breaks corporations get for “outsourcing” employees overseas have to stop. In fact if there are to be corporate tax incentives they should be geared toward investment in this country, creation of jobs and the like.
I’d like to see a change in this – to really eliminate the monarchy from America. Limit the amount that any one person can inherit to $500,000. Sure you can leave your accumulated stuff to your heirs, but you can’t take it away from the rest of us, or with you wherever you’re going. Half a million dollars is quite enough to live well on, or to get a good start on accumulating a personal pile of stuff.
Anybody who wants to dedicate his entire lifetime to material goods is not prohibited from doing so. It’s just another reminder that we are all created equal, but for the luck of the draw. Try as we might, nobody can own it all. maybe when that becomes clear, we can stop killing each other.
With the estate tax gone every child in American is born owing about $23,000 (the amount increased in the time it took you to read it).
We can have a death tax on the people who want to take it with them, or a birth tax on every newborn American regardless of the situation of their birth.