All over the right-wing sites, I read two themes constantly repeated: President Obama and the Democrats are socialists, and take back the country to the people. Of course, the idea that this country is socialist is economically incorrect, unrealistic and a misunderstanding of history. For over a century, since Theodore Roosevelt, Woodrow Wilson and the Progressive movement there have been efforts to provide safety nets for the workers, public education, and job safety. Because of people like Ida Tarbel, Upton Sinclair, Frances Perkins and others, the meat packing industry, the drug industry and the issue of clean water were addressed. There has been a century old evolution of reform, including; women’s suffrage, the end of the poll tax and the literacy test, the passing of wages and hours legislation, Social Security, child labor laws, sweat shop regulation, safety in the work force, Medicare , Medicaid and the end to Jim Crow Laws. These are just the major elements, but there are many other reforms that were basically addressed to the middle class and the working poor. There is nothing socialist in any of these efforts.
As to government controlling the means of production, setting wages and price controls, and restricting one’s ability to seek employment, none of that exists in America. We have all sorts of markets and exchanges from the NY Stock Exchange, to the NASDAQ, to the every type of commodity exchange from coffee to sugar to cotton. In other words, one can invest where they want, freely work where they wish to and to “organize” for their own benefit, as is done in the sports leagues, American industry and in civil service. The right to organize goes back to the 19th Century and the founding of the American Labor Movement to the New Deal and the Wagner Act in 1935. This right is as American as apple pie. Why shouldn’t there be a counter balance to capital through organized labor.
As to which party represents the Middle Class, the Republicans or the Democrats, why don’t we look at the record. The Republicans have been on the record against Social Security and Medicare for generations. GW Bush worked for six years to privatize Social Security. In a sense that is why his popularity crashed and the Republicans lost Congress in 2006. Currently Rep, Paul Ryan wants to privatize Medicare and have every senior buy into a private plan for $6,000 or more dollars. Will that cost be stable? Who knows? Is there any evidence that private health insurance is stable? Well it isn’t. In the last two years private health care insurance plans have skyrocketed in cost. Most people who not in a group cannot get insurance, pre-existing conditions are more prevalent then ever, and the cost for a private plan, if one can get one, is prohibitive. The average employee is paying a co-premium of $4000 with a $1,000 deductible. That means, with a plan provided through an employer, the average worker is behind $5000 before a dollar is reimbursed. How does this help the Middle Class or the working poor? The current tax plan put forth by the GOP frontrunner, Mitt Romney calls for a 1% tax cut for the lowest brackets and a 38% cut for the most highly compensated workers. Another tax plan calls for a 20% flat tax for all earners, zero capital gains tax and a zero corporate tax rate. Is the revenue neutral? No! Is that fair for the average worker? Are you kidding? The average upper income taxpayer is paying a lower affective rate than when President Reagan pushed through his two tiered tax rate of 15 and 28%. In terms of the economy, since Harry Truman, the presidency has been in controlled by Republicans for 36 years and the Democrats 28 years. Over that period of time, the Democratic Administrations have created 2 million jobs per year as opposed to the Republicans. Those are the facts. With regards to government jobs, there are 4.43 million federal workers and that number has been stable for years. There are 18.8 million state and local workers and that number, reflective of the Bush Recession, has shrunk by a few hundred thousand workers. With regards to federal expenditures, less than 20% of all government workers are paid by your withholding tax, and over 50% of those federal workers are members of the Armed Forces. So the argument framed here about “big” is with the states, much more than with the federal government.
With regards to the argument that 47% of the public does not pay taxes well that is patently false. Every worker is paying a payroll tax of a maximum of 8% up to $106,000 in income. In fact, every America worker is paying down weekly, through the payroll tax, our greatest, future liabilities we face: the entitlements Social Security and Medicare. In fact, as a worker earns more than $106,000, their percentage of reducing the entitlement deficit is reduced. Who benefits from Social Security and Medicare? It is the Middle Class and the working poor. In fact, most Americans who pay zero taxes should probably pay a minimum tax. But, would another $500 or $1000 per low income family equal raising the top bracket from 36.5 to 39.5%? It would not. Today, with a capital gains tax rate of 15% on dividends and venture capital income, the rich are very, very well off. Of the 400 richest Americans, only 200 are employed and therefore, they for sure do not create jobs. In fact, of the remaining 200, are they creating jobs? Many of these individuals make their huge incomes in the financial sector and do not create jobs or new businesses. There are $375,000 Americans making over $1 million per year. They are paying the lowest taxes since the Crash of 1929. But even when the Constitutional Amendment creating the income tax was passed in 1914, there was always a very high bracket, of at least 90%, for the richest of all Americans. Why would a return to the Clinton Era top tax rate of 39.5% and a graduated capital gains tax hurt these folks? I believe it will not. The Middle Class would be better served by an increase in the payroll tax to $212,000, which would save Social Security and Medicare for generations, and would not affect any one of you! In reality an increase in the top bracket to 39.5% would affect almost no one in the middle class!