Tag Archives: benefits

Obama Embraces the Gang of Six and Turns his Back on the Middle Class

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Who are the “Gang of Six?” When the media says “gang” of six, do they mean a gang of punks, a gang of robbers, or a gang of thieves? After reading the outline of the budget proposal put forth by the Gang of Six, they appear to me to be a gang of thieves who wish, with government approval, to steal from the middle class and give to the super rich.

And what does Obama think of them? I’ll get to him soon, but first I want to talk about Franklin Delano Roosevelt. I recently read a biography of FDR titled Traitor to His Class: The Privileged Life and Radical Presidency of Franklin Delano Roosevelt. He earned the title of traitor because, although he was born into a family of wealth and privilege, as president he sided with the common people and pushed through government programs that provided not only much needed jobs in a deeply depressed economy, but safety nets for working people and poor people so they could live with dignity in their retirement years.

Roosevelt recognized his pals in the top 1% didn’t need any more government handouts, they needed to start giving back what they had taken from the economy, so he sharply increased their taxes and funneled the money through new government programs back to  the people who actually created the wealth: the workers. And some of the taxes collected from the rich would pay for a long expensive war that was fought by regular working folks.

President Obama wasn’t born into wealth and privilege, but he is a wealthy man now, and I am beginning to think that his wealth has corrupted him.

As he took office the U.S. was facing huge deficits that were primarily the result of Bush’s wretched stewardship.  So early on in his presidency Obama created a bipartisan commission, now known as the Simpson-Bowles commission, to come up with a budget plan that would solve our long-term debt problem. One would think that this commission would find it wise to tap into the pockets of the extremely wealthy top one-percent earners who keep 24% of the income generated by our economy for themselves. But that’s not what the commission did. Instead it went with the maxim “broader base, lower rates.” Yes, their plan would reduce the number of tax tiers and lower the tax rate on the top tier by 9% thereby decreasing federal taxes paid by millionaires and billionaires, but somehow this plan would increase revenue. How could that be? That’s the “broader base” part.  You do the math. More revenue would come from the middle class by taking away their deductions and tax credits.

Obama should have dismissed the commission’s plan out of hand and told the American people he rejected it because the rich are doing better than ever – it’s the middle and lower classes that are hurting.

Then along comes the Gang of Six who resurrected many aspects of the Simpson-Bowles plan including their proposal for fewer tax tiers and a lower tax rate for the top tier.   Dean Baker explains:

The plan also calls for large cuts in tax rates including a targeted top rate of between 23-29 percent, which will be at least partially offset by elimination of tax deductions. For the highest-income people, this is likely to mean a very large reduction in taxes. For example, Jamie Dimon and Lloyd Blankfein, the CEOs of J.P. Morgan and Goldman Sachs, respectively, are both paid close to $20 million a year at present. If this pay is taxed as ordinary income, then they would be paying close to $7.5 million a year in taxes on it after 2012. However, if the top rate is set at 29 percent, they may save as much as $1.9 million a year on their tax bill. If the top tax rate is set at 23 percent then the Gang of Six plan may increase their after-tax income by more than $3 million a year.

Obama should have rejected this plan and explained to the American people that more tax cuts for the richest Americans is unconscionable.  He should have vowed to veto any legislation that includes: More tax cuts for the rich, substantial cuts in benefits for the middle class, and (after doing the math) higher taxes for the middle class.  Bernie Sanders explains:

While all of the details from the so-called Gang of Six proposals are not yet clear, what is apparent is that the plan would result in devastating cuts to Social Security, Medicare, Medicaid and many other programs that are of vital importance to working families in this country. Meanwhile, tax rates would be lowered for the wealthiest people and the largest, most profitable corporations.

But Obama did not reject the Gang of Six plan.  He embraced the plan, and that is why he is a traitor to his class, effectively making him an anti-Rooseveltian Democrat.

At this point you may be thinking, “But Brad, you were a big supporter of Obama.  Aren’t you being a bit shrill?  Will it really be as bad as you are saying?”

Well congress has yet to work out all the details of the Gang’s murky outline for changes to the tax code, so we’ll have to wait to see it in its final form.  But I am betting that the end result will be a great loss of net income for the middle class, via increased taxes and reduced benefits, and a substantial increase in net income for the super-rich via tax cuts.  Oh excuse me… did I say “rich”?  I forgot we weren’t supposed to refer to the top 1% earners as “rich” anymore.  I meant to say “job creators.”  Reminds me of the old comic books I used to read as child, “Job Creatorie Job Creator Poor Little Job Creator Boy.” (a tip of the hat to The Daily Show.)

Well I’ve had it with our government’s pandering to the super “job creators.”  This country needs the Gang of Six plan about has much as it needs another unfunded trillion dollar war.  What our country really needs is another revolution to overthrow a government that has been bought by billionaires.

I am ready to join.

In Scapegoating Public Employees, GOP Sinks to New Low

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State and local public employees seem to have a target on their backs these days. GOP-controlled legislatures and governors are forcing cuts to their pay and benefits without the niceties of negotiation, whilst they seek to break the back of their unions by cancelling collective bargaining rights. While it’s understandable if totalitarians and tyrants around the world are applauding, it’s much harder to see why many ordinary Americans are doing likewise.

Admittedly, these are hard times for some Americans and it may be tough to swallow the well-publicized fact that public sector employees generally enjoy relatively generous benefits such as pensions and health care coverage. But let’s keep things in perspective.

On average, public employees are better educated than their private sector peers; they are also less well paid than their private industry contemporaries with similar qualifications. If their benefits are more generous, that’s attributable in part to the reluctance of governors and legislatures to grant wage increases. Public sector unions have, therefore, often settled for improved benefits over increased pay.  These more generous benefits have been hard won through the give and take of negotiation. To decry them now as though there was something illegitimate about the process, and deprive public employees of their collective bargaining right is simply a travesty of truth and justice.

And it does no credit to those Americans who are currently railing against public employees by making invidious comparisons to their own working conditions in private industry. We would do better, perhaps, to raise the standard of employment in the private sector in America so that pay and benefits, including health care and vacations, not only match the public sector in America, but also workers elsewhere in the industrialized world, behind whom we lag badly. Or does misery love company that much in today’s America?

And who are these people whom Republicans love to disparage? They are the teachers who prepare our kids for a tough and competitive world; the police officers and fire fighters who keep us safe by risking their lives every day; the corrections officers who spend their time enclosed with the scum of our society; the street cleaners, the parks employees, the utility workers and the many, many, others who keep our communities clean and safe, and our homes light and warm.

Before joining the misguided accolades for GOP governors like Walker in Wisconsin or Kasich in Ohio, we should each ask these three questions:

  1. Do we want capable people to oversee and implement our vital public services?
  2. Assuming we do, doesn’t it make sense for government at all levels to attract the best people by providing them with attractive compensation packages?
  3. Even setting aside the practical issues, should government be in the business, morally, of providing relatively low wages and benefits to its employees?

Rather than make them the targets of our ire even in these uncertain times, we should be thanking our lucky stars that we are blessed with fine public servants who do what they do for us and do it so well.