Friday, December 3, 2010
Taxing for a Whole New World
We have done very well over the last several years. Now, during our nation's moment of need, we are eager to do our fair share. We don't need more tax cuts, and we understand that cutting our taxes will increase the deficit and the debt burden carried by other taxpayers. The country needs to meet its financial obligations in a just and responsible way.
Patriotic Millionaires For Fiscal Strength
I'm trying to figure out how anyone can keep a straight face and say they're for deficit reduction while they insist on a permanent tax cut for the wealthiest Americans, completely unpaid for. They want to say this is class warfare — well, you know, in a way it is, because we are fighting for the middle class.
US Senator Claire McCaskill (D-MO)
Economist Robert Reich labeled this past week National Fiscal Hypocrisy Week and began his blog post yesterday with this:
Quiz: What’s responsible for the lousy economy most Americans continue to wallow in?
A. Big government, bureaucrats and the cultural and intellectual elites who back them.
B. Big business, Wall Street and the powerful and privileged who represent them.
These are the two competing stories Americans are telling one another.
Reich reports that A is the story that Republicans are telling and that B is the story that very few political leaders or media outlets are telling. That's right: Obama and most Democratic leaders are also telling A. The problem is that the truth is much closer to B. Here's how Reich explains the slightly more complex narrative:
In reality, the lousy economy is due to insufficient demand--the result of the nation's almost unprecedented concentration of income at the top. The very rich don't spend as much of their income as the middle. And since the housing bubble burst, the middle class hasn't had the buying power to keep the economy going. That concentration of income, in turn, is due to globalization and technological change--along with unprecedented campaign contributions and lobbying designed to make the rich even richer and do nothing to help average Americans, insider trading and political bribery.
Did you get that? It's macroeconomics 101: aggregate demand is still too low to add more jobs to the economy and our political rules are stacked against the poor and middle class. And this was exactly the tremendously sad news unveiled this morning: 9.8% unemployment (only 39,000 jobs were added in November--compare this with economist Dean Baker's assessment 3 weeks ago: "In order to fill this gap in a reasonable period of time, say 3 years, we would need job growth of 370,000 a month.").
We all woke up this morning to a world of increased joblessness, national (and state) budget deficits and corporate profits. As the corporations make more and more money and pass those benefits along to their executives, they sit on trillions of cash and do not hire, passing along more and more tasks (and more and more anxiety) to their workers, whose wages remain stagnant. On top of this, GOP Senators like Tom Coburn passionately express that government is too big and must get out of the way for businesses to succeed and expand, demanding that nothing gets done in Congress until the wealthiest Americans get their tax cuts renewed.
There are 3 key take-aways this morning for prophetic Christians (and, really, all faith communities who dare to call themselves "biblical"):
1. A biblical faith adamantly calls us to give privilege to society's bottom-dwellers: the poor & economically anxious, the jobless, the oppressed, the overworked-and-underpaid. God's people are uniquely those who "look out" for those who are disadvantaged and vulnerable: this is what God did for the Israelite slaves in Egypt and what Jesus did for those within Israel during 1st century Roman hegemony. For those who sign on to Christian mission (as opposed to "status"), we make it our goal be what God is for the world. In order to do this faithfully and tangibly, we work to create an economic system that gives legitimate opportunities for all people to earn a living wage in society. People need a realistic opportunity to "make it" & care for themselves and their families. Increased joblessness is a "family value" that should have our undivided attention and we need to give this issue the best of our wisdom, discernment, creativity and resources.
2. With that said, we should study and discern what actually works best for the macroeconomy. A robust theology naturally leads us to seek to uproot junk economic theories. This means that economic theories that are built on a foundation of "trickle down" arguments must be rejected. To claim that a "significant proportion" of small business owners will be hurt by a modest increase on all income over $250,000 (as Liz Cheney deceptively claimed on Fox News Sunday) is untrue and has been rebutted convincingly by non-partisan factcheck research like Politifact.
3. We must make room in this constructive conversation for our very specific context: 30 years of Reagan-Bush policies. This is 2010. Over the past 30 years, corporations and the top 1% of wage earners have garnered tremendous privilege in regards to American fiscal policy. They have greatly increased their share of the whole economic pie (as has been nicely documented by Harvard and Duke economists here). Remember, when Reagan began his trickle down revolution in January of 1981, the highest marginal tax rate was 70%. It was at 28% before Reagan was finished and creeped up to 39.6% during the economic growth and budget surplus years of Bill Clinton. In fact, during the economic booming years of Eisenhower (think about how we glorify the 50s and early 60s today), the highest marginal tax rate was at 91% for 13 years in a row. Ninety. One. Percent.
Not only has Columbia's Moshe Adler passionately argued against renewing the Bush Tax Cuts for the wealthy, so also has Reagan's key fiscal advisor, David Stockman! And I can't tell you how often I've heard folks recently rant about my native California and how harsh it has been on big business. Not so say the studies:
Many voices on the right are calling for a blanket renewal of all Bush Tax Cuts (even for the most wealthy American citizens) strictly on the basis of the midterm election results from a month ago. This "logic" posits that the American people have spoken clearly: government is too big! This claim is ridiculous. The American people actually just decided to emasculate the party in power (Dems) because they presided over the stagnation of a broken economy passed down from the Bush years. If anything, government did not do enough to produce jobs (especially since private industry is not producing jobs...again, due to lack of demand).
What makes this whole political quagmire even more inhumane is the Republicans demand to prioritize (first and foremost) the privilege of the wealthy over anything else this month. Christians on the right (that I dialogue with) actually consistently claim to care about immigrants, gays & lesbians and the federal deficit, but want to achieve "justice" on all of these issues on their terms and their timeline. A year ago, Republican political leaders (with Obama and the Dems eating out of their hands) demanded that the Pentagon study the possible effects of ending Don't Ask, Don't Tell by taking a massive, year-long survey of the attitudes of soldiers and their families on the issue. That study just came out two days ago and it could not be any clearer that now's the time to end it (and at the same time that the GOP pulls out every possible obstacle, Obama and Dems are waiting for a perfect storm with all the stars aligning to change the policy through Congressional action, not through "judicial fiat" or the President's executive order). In addition, the Dems are promising to introduce a watered-down version of the Dream Act for children of undocumented workers in the US (which would decrease the national debt by more than $1 billion over the next decade) and a renewal of jobless benefits that will ultimately be a decisive stimulant to aggregate demand since the unemployed poor and middle class will inevitably spend that meager $310 per week just to survive.
When things get so lamentable for the least of these, what can we possibly do? Progressive Christian Uniting's director Peter Laarman wrote this:
In times like these we can (and should) rage against the dying of the light in Washington DC. But we can also look for new sources of light in our own lives and communities - and in our faith. We can do the grown-up thing and admit it was delusional ever to expect any national candidate or campaign to deliver us from wealth oppression. We can begin to put our primary energies into building sustainable communities of resistance and of shared prosperity: communities that exemplify our shared values and that draw their power from those values. For Christians, this turn toward base communities ought to feel a bit familiar: it was how the Jesus followers managed to sustain themselves--and grow--in the shadow of an unjust Roman Empire, way back at the beginning.
Perhaps our only hope is to join communities that are committed to educating themselves and passionately living out a dynamic brand of economic justice that resists wealth oppression. This will mean dialoguing these local, state and federal tax issues by transcending polarizing ideological commitments that use statistics to advance their own agendas. It will mean praying for wisdom and discernment as we strategize towards more just economics at the level of both policy and personal resonsibility. One of our most important goals is, as Cornel West says it, "to bring the age of Reagan to a close."
This era of personal fulfillment through consumption and self-promotion, as well as an indifference to the most marginalized starts in communities that tangibly reflect on how this has manifested itself in our own lives. In the suburbs, this will mean honest conversations about how Reagonomic and Bush Tax Cut policies have given certain folks even more socio-economic privilege. Those of us who take the Jesus Revolution seriously, with all of its social-economic-political-spiritual ramifications, will need to ask important questions about how those who have benefited most from the Reagan Revolution need to make modest sacrifices for a more humane and life-giving United States of America.