The President did it. He finally called out the rich to share in the nation’s pain. Introducing his debt-reduction plan, he put the proverbial “gun” right on Congress, right before the 2012 elections. Now let them go out and defend the rich while the rest of America is hurting.
The politics of shared sacrifice is about to become a reality for the Republicans. They’re about to sacrifice some members over this. In the meantime, pragmatism has finally come to this whole balanced budget discussion. It has never been a reasonable conversation to have four trillion dollars in spending cuts without some reasonable interjection of revenues.
And the hostage holding is over. The whole Congress will have to break free from the “budget terrorists” that hijacked the debt ceiling negotiation process. Certainly, they will take credit for forcing the debt reduction debate, and that is a partial truth. But now they can take credit for also forcing the shared sacrifice debate. There can be no sacred cows in this process, though there are clearly some (Medicare and Social Security).
Common sense would tell us where the revenue should come from. Protecting less than one half of one percent while the other 99 and a half percent suffer is class warfare. Republicans are claiming “Reverse class warfare,” suggesting that the rich are being unfairly targeted. It’s not going to work in the same way “reverse discrimination” worked. The rich got a windfall they never should have gotten under the Bush Administration. That’s when the deficit exploded. If they want to get the deficit under control, they have to put the revenue back. Obama got it right.
In what is being called “the street fight for the future of America,” the debate should focus the nation on “what is rich” and exactly what that means. The plan President Obama is calling the “Buffet Plan” (named after Billionaire Warren Buffet, who has openly advocated tax reform after he discovered his secretary was in a higher tax bracket than he was but earning much, much, MUCH less), asked that anyone making more than one million dollars pay more than the 15% tax they currently pay. In 2010, 440,000 Americans filed taxes earning more than a million dollars.
That’s .03 of the American public, out of 144 million taxpayers. It will create 1.5 trillion dollars over the next ten years. That’s significant. Now what will that do? That will put America close to the balance budget approach we operated under the Clinton Administration in 2000. Clinton left office with a budget surplus and was on target of eliminating the budget deficit by 2008. The Economic Growth and Tax Reconciliation Act of 2001 and the Jobs and Growth Tax Reconciliation Act of 2003 were passed to spur the economy and create jobs during the recession that occurred the first year of the Bush Administration.
Jobs were on the America’s mind when the 9/11 terrorist attacks refocused the nation’s attention. Giving the rich tax breaks and job creation credits were supposed to spur job growth. No new jobs were created and in fact, the nation experienced zero job growth through the entirety of the Bush Administration—a point conveniently forgotten when the critics blast Obama for not creating enough jobs. However, he has created some jobs.
Named the “Bush Tax Cuts,” this is a policy that is by and large viewed as ineffective and was a gift to the rich to help his re-election. They were supposed to expire in 2010, but the state of economy was such that the debate around letting them expire would have ruined the nation.
Obama traded two years more of tax cuts for the rich to get two more years of unemployment benefits for eight million people out of work. We can’t forget that when we talk about the high unemployment rate. How high would it have been had the tax cuts not been extended?
The Republicans play “chicken” with the lives of everyday Americans to protect a very small segment of the population who’s benefits outweigh their contribution to the nation. The rich as “job creators” has been, by and large, been written off as a fallacy. That’s why Obama’s plan is timely. Folk are tired of cutting the rich a break on a false premise. The rich get favoritism because everybody wants to “be them.” I don’t know anybody who would say, Naw, I’d rather be poor (or middle class).” Particularly if you’re paying higher taxes.
In a free market economy where wealth is attained without limit, the rich should pay more. Three out of four Americans agree that the rich should pay more, if the poor are going to lose services. It is a practical approach to debt reduction reform in America. The people want their quality of life back. Tax exemption should not be a proposition reserved only for the rich. Everybody else pays their way. The rich should too.
Let’s see how long it takes Congress to agree with the public.
The Black Commentator