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The Dow Jones during the Bush Years and the Obama Years

The Dow Jones during the Bush Years and the Obama Years

UPDATED January 20, 2017 and moved to the top of the blog to show all of Obama’s term with all of Bush’s term:

Are you better off today than you were four eight years ago? The Dow Jones during the Bush years peaked and spiked, taking the market on a harrowing roller coaster ride. Well if you invested stayed in the market for the past eight years, I think the answer…

was YES! four years ago and the answer is YES!!! right now.

Here are two charts that illustrate how much better off your investments were under Obama’s tenure than Bush’s tenure:

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Conservative Shift on Unemployment Benefits: from George W. Bush to Frank Luntz

Conservative Shift on Unemployment Benefits: from George W. Bush to Frank Luntz

“These Americans rely on their unemployment benefits to pay for the mortgage or rent, food, and other critical bills. They need our assistance in these difficult times, and we cannot let them down.” – George W. Bush, 2002

“You should not expect a handout. You should not even expect a safety net. When my house burns down, I should not go to the government to rebuild it. I should have the savings, and if I don’t, my neighbors should pitch in for me, because I would do that for them.” – Frank Luntz, The Atlantic, 1/6/2014

Easy for him to say. He lives in a 14,000 square-foot mansion in Los Angeles. What if he lived in a modest house near the Jersey shore when Hurricane Sandy struck? Would his neighbors be able to pitch in? His neighbor’s neighbors? No.

I’ve heard this impracticable conservative pitch for replacing government assistance with charitable giving many times before. It may very well work on a very small scale like within your neighborhood or within your church or whatever, but it can’t work on a large scale when millions or, worse yet, tens of millions of people are affected by a natural disaster or a Wall Street disaster. Well not unless everyone gets paid millions of dollars like Frank Luntz is to sell his twisted political language to the Republican party and Fox News.

Iraq War 10 years later – it’s still hard to believe it happened.

Iraq War 10 years later – it’s still hard to believe it happened.

It’s been a decade since we invaded Iraq in what may rank as the most calamitous foreign policy decision ever by this country. A few thoughts.

The selling of a war: The administration of George W Bush skillfully exploited the fear and insecurity engendered by 9/11 to push an attack on Iraq that, in normal circumstances, the country would never have countenanced. Obsessed with removing Saddam Hussein, the administration concocted a case for war from cherry-picked intelligence and worst-case scenarios; they then launched a sales campaign replete with dire warnings that conjured visions of mushroom clouds and poison gas that ultimately succeeded in bamboozling congress, the media and most Americans into acquiescence. Absent was even a minimally serious deliberative process within the administration to weigh the evidence, balance the risks and seriously consider opposing views to determine the right course, even assuming Iraq had weapons of mass destruction (which they did not). That the nation fell for it despite the gaping holes in the administration’s case still boggles the mind.

The media aids and abets: With some honorable exceptions (such as McClatchy Newspapers whose solid reporting exposed the thin gruel constituting the administration’s justification, and the editorial pages of The New York Times) the media failed to challenge the administration’s case for war. There was certainly enough credible evidence and intelligence to cast serious doubt on the notion that Saddam Hussein’s Iraq possessed WMD, or represented a genuine threat even if it did, that the media had a duty to forcefully question the administration’s rationales. It was also blindingly clear that the administration had given little thought to the aftermath of an invasion. Yet the so-called liberal media such as The Washington Post failed to hold the administration’s case up to the probing scrutiny that was critical and even suppressed contrary opinions and indicators.

An unprepared military that proved adaptable: Opponents of the war understood that the easy part would be the defeat of the Iraqi forces in the initial assault, a fact not fully grasped by the commanding general of the invasion force, General Tommy Franks, when he retired some months after the fall of Baghdad and the regime. He left behind a nascent insurgency for which the US military was completely unprepared. The eventual cost was appalling: more than 4,500 American servicemen and women killed and over 30,000 wounded. The vast majority of these casualties were incurred fighting the insurgency. In contrast to their leaders the volunteer military itself performed magnificently throughout the Iraq conflict, and continues to do so in Afghanistan. Even during the darkest days of the insurgency when salvaging anything resembling a victory seemed unlikely, the soldiers, sailors and marines never faltered. They are the heroes of the Iraq story.

Political hacks as administrators: The Provisional Coalition Authority under former ambassador Paul Bremer (now a painter) was established as an interim governing body following the invasion. The PCA was staffed primarily with GOP loyalists whose qualifications didn’t extend beyond knowing the right answer to whether Roe v Wade was a good decision. These ignorant bozos whose knowledge of Iraq could fit on a postage stamp then tried to micromanage the country by trying to graft ideologically driven public policy solutions onto a country that had just been administratively beheaded. They failed to see to the most basic needs of the people such as restoring the flow of electricity and clean water. Bremer himself committed the single biggest blunder by disbanding the Iraqi army and barring even mid-level Ba’ath Party members from government positions, a decision that inflamed and fueled the budding insurgency that soon was to devastate Iraq.

Cheney and Rumsfeld were really bad news: The combination of Dick Cheney as Vice-President and his old pal Donald Rumsfeld as Secretary of Defense was touted by the media as a Bush administration foreign policy and national security powerhouse of expertise. In reality, Rumsfeld’s tenure was marked by equal measures and copious amounts of bombast, bullying and bullshit. Competence on the other hand was largely absent and when Iraq descended into murderous chaos, Rumsfeld simply appeared befuddled and out of his depth. Only when Robert Gates became Defense Secretary did we see real competence come to that portfolio. Cheney was the driving force in the push for war and was also the instigator of employing torture as national policy. Ironically, the invasion of Iraq enabled al-Qaida’s establishment in Iraq and strengthened Iran as the primary regional power, outcomes very much against our national security interests. Cheney and Rumsfeld really were national disasters.

General Petraeus and the surge: In fact this was simply the adoption of a counterinsurgency strategy, the heart of which was to protect the civilian population in urban centers while deploying special operations forces to kill or capture key insurgents and their leaders. It was a welcome change but its effectiveness was greatly enhanced by the concurrent Sunni Awakening, in which tribes stopped fighting the Americans and turned on al-Qaida-in-Iraq’s murderous barbarism. This took out 70% of the most effective Sunni insurgents and turned them against the terrorists. In the end the US military pulled out a well-deserved victory of sorts but the cost was prohibitive.


Iraq today is a nascent but fragile and divided democracy. Majority Shiites hold most of the levers of power with ever more wary Sunni and Kurd minorities viewing the authoritarian government of Nouri al-Maliki with deepening suspicion and fear. While levels of violence are down from the war years, Iraq is still an extremely violent country. It is a work in progress and nobody can say for sure how it will turn out; whether it will become a thriving democracy, a beacon for the Middle East as war proponents once envisaged, or descend once again into strife and chaos as different factions vie for power. Maybe in another decade we’ll have a better idea. One thing we do know is that the price of the war for Iraqis was truly horrendous: at least 100,000 dead and many times that number injured.

For Americans I think the essential questions remain: How did we as a strong democracy with a free and unfettered media, ever allow our country to invade another with so little justification? And how can we avoid making the same mistake again? Even to this day I don’t believe we yet have the answers.

The fiscal cliff is more like a slope and taking a stroll down it won’t kill us

The fiscal cliff is more like a slope and taking a stroll down it won’t kill us

The dire predictions about what will happen when we go over the fiscal cliff on January 1st are almost certainly overblown. The markets may react badly but that’s a consequence we can tolerate.

The essential point is that the Bush tax cuts in their present form should be allowed to expire. Work can then begin on passing new ones that don’t benefit the wealthy. That means allowing top rates to resume the level they enjoyed before George W Bush became president. And for good measure we shouldn’t be in a rush to restore cuts to the unearned income tax rates that also were slashed under Bush. On the other hand, taxes should be cut on those earning less than $250,000 a year and, for good measure, the 2% payroll tax cut should be restored.

In the fiscal cliff negotiations, however, Democrats and the Obama administration confront not only GOP intransigence but also rank hypocrisy. For example, much is made of the need to reform (read cut) spending on, entitlements, particularly Medicaid and Medicare. In the case of the latter, however, Republicans have relentlessly attacked Democratic proposals to improve the program’s efficiency as rationing. Yet wringing efficiencies out of both programs is essential and, really, the only way to go since Democrats are never going to agree to turn Medicare’s benefit into a voucher, nor block grant Medicaid and allow states such as Texas to eviscerate medical coverage to America’s poorest.

Most important, however, is that the fight over entitlements misses the point. Both programs provide medical coverage to those Americans most vulnerable to illness in our society – the elderly and the poor. The private sector is incapable of doing the job; heck, without government support and regulation (Obamacare), the private insurance industry can’t even provide coverage to 40-50 million Americans who are neither poor nor old. A single-payer health care system would render both programs superfluous but that, unfortunately, is a pipedream.

So our “entitlements” provide a critical service that our society cannot do without, and we have no choice but to find a way to pay for them. We can do that in part by cutting other parts of the budget (bloated defense, intelligence and homeland security budgets are a good place to start). There is also plenty of scope for raising revenues. Some examples: In addition to allowing the Bush tax cuts on the wealthy to expire, we can raise rates on all unearned income to the top level paid by working Americans on their earned income and charge a surtax on millionaires as some have suggested. The corporate tax rate could be lowered to match those of our peers in the industrialized world but also changed to ensure that companies cannot use dodges, deductions and exemptions to avoid paying any taxes.

Republican dogma posits that the nation has a spending not a taxing problem. The fact is it’s more likely the other way around because for years we have refused to pay for the government services we have decided we cannot do without. To the extent we have a spending problem, however, it is that we blow too much money on protection against non-existent or overblown military and security threats while neglecting the needs of our poorest, and those things that will make us a stronger, better society in the long run: our schools, our institutions of research, our infrastructure, our environment and our people’s overall well-being.

We can only hope that a stroll down the self-created fiscal slope helps us, belatedly, to have an intelligent, substantive and searching discussion of these larger issues. But don’t hold your breath.

Who Are Mitt Romney’s Freeloading 47% and How did they Get Here?

Who Are Mitt Romney’s Freeloading 47% and How did they Get Here?

The 47% of people who did not pay federal income tax is made up of the elderly, the disabled, the those earning military pay, and even some millionaires, but the largest portion of those who do not pay the tax are the working poor. They don’t pay federal taxes because of the Earned Income Tax Credit.

The idea that lead to the Earned Income Tax Credit orginated with conservative economist Milton Friedman. He proposed a transfer of funds to every citizen that he called a negative tax. If the transfer was set at $6,000 per person per year, then a family of four with no other income sources would have $24,000 to live on. Congress did not like the idea of giving everyone the transfer payment because they believed it would result in too many freeloaders.

Congress took Friedman’s idea and applied it to only those who work. The idea was to encourage people to work, but provide subsidies to those who work for low pay. The law was passed in 1975, and President Ronald Reagan praised it:

Millions of working poor will be dropped from the tax rolls altogether. The bill I’m signing today is not only an historic overhaul of our tax code and a sweeping victory for fairness, it’s also the best anti-poverty bill, the best pro-family measure and the best job creation program ever to come out of the Congress of the United States.

The Tax Policy Center concluded that the law accomplished its goal of bringing more people into the labor market.

The Newt Gingrich controlled House worked with President Bill Clinton in the nineties to expand the Earned Income Tax Credit in their efforts to “end welfare as we know it.” Clinton signed the bill in 1997.

President George W. Bush pushed through a huge tax cut in 2001 that moved even more lower-income people off the federal tax rolls. His massive 2003 tax cut was aimed at the wealthy and drastically cut their taxes – some even as far a zero. Bush’s doubling of the $500 Child Tax Credit moved even more off the the tax rolls. (Yes it’s true, not all of his tax breaks targeted the wealthy.)

When Mitt Romney said to Neil Cavuto on Fox News last night: “I know some believe that government should take from some to give to the others. I think that’s an entirely foreign concept,” did he insult all the former Republicans that helped enact the Earned Income Tax Credit? Oh my God! Ronald Reagan must have been a foreigner! Has anyone checked his birth certificate?

Seriously though, Republicans pushed through most of the tax laws that cut taxes for 47% of Americans to zero, so when Romney says the idea that our government should redistribute wealth is a foreign, just what party does he think he represents? How stupid does he think we are? Does he think he can get away with running as the Republican candidate for President and complain that 47% of Americans pay no income tax when his party that was instrumental in bringing that about?

Based on all he’s said and done in the past few weeks, one could very well think he is a stupid man, but I don’t really think is. I think he knows quite well that what’s fueling our long-term debt is that, in addition to redistributing tax payments to the working poor, the Republicans also gave away trillions of dollars of tax cuts to the super rich. I also think he knows  our social safety net is here to stay, so if he wants to change the tax code to run surpluses, he has to do what Bill Clinton did: Arithmetic. He won’t do it though, because the Paul Ryan/Tea Party faction of his party won’t let him.

Rich and Not Rich on Jobs and Deficits

Rich and Not Rich on Jobs and Deficits

From the February 2012 Harpers’s Index:

Average annual tax savings for member of the top 1 percent of earners under the Bush tax cuts:  $66,384

Average annual income for the other 99%:  $58,506

Factor by which an American is more likely to cite unemployment than deficit as the country’s “most important problem”: 3

Factor by which a wealthy American is more likely to cite the deficit than unemployment: 3

And there you have it.  The rich have been paying taxes at historically low rates for the past few decades (Yes, even the Clinton top rate of 39.4% is low by historical standards. It was 70% during the Kennedy years, and 91% during the Eisenhower years) and they are most concerned by the deficit while they are in the best position to do something about it-pay more taxes. Many of them do want congress to raise their taxes, but Republicans are doing everything in their power –  filibustering – to prevent any increase in federal revenue through any types of changes to the tax code. In fact, every tax plan proposed by Republicans running for president includes more tax cuts for the super rich, and some even include tax increases on the middle and lower classes.

If wealthy Americans are really concerned about the deficit, then they should contact their representatives in congress and ask them to raise taxes on the top 1% earners.

If wealthy Americans are really concerned about the deficit, then they should contact their representatives in congress and ask them to pass the Obama Jobs Bill that would put hundreds of thousands of currently unemployed people back to work. Providing jobs increases tax receipts and reduces the deficit. Providing jobs also increases consumer demand which grows the economy.

All the proposed austerity measures that Republicans are pushing will decrease jobs and shrink the economy causing greater deficits. Simple math tells me they are really all about making the rich richer and screwing the middle and lower classes.

The very wealthy people need to start paying more taxes – at least at the rate they paid during the Clinton years – and the government needs to start spending money on projects within our borders that create jobs. Once the economy gets back to pre-recession levels, taxes should go up on the middle class too.

John McCain says Torture had Nothing to do with Finding Osama bin Laden

John McCain says Torture had Nothing to do with Finding Osama bin Laden

John McCain had something to say in his May 11th Washington Post column about the claim that the Bush Administration’s use “enhanced interrogation” techniques provided the key information leading to the killing of Osama bin Laden:

Former attorney general Michael Mukasey recently claimed that “the intelligence that led to bin Laden … began with a disclosure from Khalid Sheik Mohammed, who broke like a dam under the pressure of harsh interrogation techniques that included waterboarding. He loosed a torrent of information — including eventually the nickname of a trusted courier of bin Laden.” That is false.

I asked CIA Director Leon Panetta for the facts, and he told me the following: The trail to bin Laden did not begin with a disclosure from Khalid Sheik Mohammed, who was waterboarded 183 times. The first mention of Abu Ahmed al-Kuwaiti — the nickname of the al-Qaeda courier who ultimately led us to bin Laden — as well as a description of him as an important member of al-Qaeda, came from a detainee held in another country, who we believe was not tortured. None of the three detainees who were waterboarded provided Abu Ahmed’s real name, his whereabouts or an accurate description of his role in al-Qaeda.

In fact, the use of “enhanced interrogation techniques” on Khalid Sheik Mohammed produced false and misleading information. He specifically told his interrogators that Abu Ahmed had moved to Peshawar, got married and ceased his role as an al-Qaeda facilitator — none of which was true. According to the staff of the Senate intelligence committee, the best intelligence gained from a CIA detainee — information describing Abu Ahmed al-Kuwaiti’s real role in al-Qaeda and his true relationship to bin Laden — was obtained through standard, non-coercive means.

And regarding the morality of torture and the ideals Americans claim to uphold, he said this:

Ultimately, this is more than a utilitarian debate. This is a moral debate. It is about who we are.

I don’t mourn the loss of any terrorist’s life. What I do mourn is what we lose when by official policy or official neglect we confuse or encourage those who fight this war for us to forget that best sense of ourselves. Through the violence, chaos and heartache of war, through deprivation and cruelty and loss, we are always Americans, and different, stronger and better than those who would destroy us.

I agree with his statements that torture is wrong and that waterboarding, “which is a mock execution and thus an exquisite form of torture,” must never be used by Americans under any circumstances.  I’ve always argued, like McCain did in his column, that torture is a moral issue and that it is never – under any circumstances – the right thing to do.

If you read the first few paragraphs of his column you will find that he thinks the military personnel who authorized or carried out orders to use enhanced interrogation techniques, including waterboarding, should not be prosecuted.  I disagree with him on that point.  Why shouldn’t they be prosecuted?   What is to stop anybody in the U.S. armed forces from torturing again if those who are known to have done it and those who are known to have approved and ordered the torture of captives are never held to account for their heinous crimes?

I say prosecute them all, but start at the top not the bottom.  You know which guys I’m talking about:  Bush, Cheney, Rumsfeld, Gonzales, Yoo, and anyone else in the “Justice” Department who wrote twisted interpretations of US and international law to justify the crimes committed by the Bush Administration.

Cheney et al Will Not Sully Obama’s Victorious Blow to al Qaeda

Cheney et al Will Not Sully Obama’s Victorious Blow to al Qaeda

Locating and killing the world’s most infamous terrorist is a huge victory for America. That is beyond doubt. It was achieved by the tireless work of our intelligence community and by the skill, daring and courage of our special operations forces. And it could not have happened had President Barack Hussein Obama not made one of the gutsiest calls ever by any president. He made it following careful deliberation and after weighing the pros and cons from advisors with, what we know now were, differing opinions; and in the knowledge that, despite the risks, there was no better than an 80% chance that Osama bin Laden was even in the compound in the Pakistan military garrison town of Abbottabad. It’s a victory over al-Qaeda that we should all celebrate both because it has struck a serious blow against the terrorist organization, and because justice has been served to the thousands of innocents who have been killed on bin Laden’s orders.

No matter how distasteful, I suppose we shouldn’t be surprised, however, to be treated to the spectacle of Dick Cheney, Donald Rumsfeld and other apologists from the last administration emerging from the woodwork to link this singular achievement to the torture of detainees during the Bush years. As Maureen Dowd said in a recent piece, these efforts are torture in themselves.

On Fox News Sunday, Chris Wallace asked Tom Donilon why it was okay to shoot an unarmed Osama bin Laden but not to torture (of course this was Fox News so Wallace never used the word “torture”) suspected terrorist detainees.  It says much about the state of mind of so many on the right in this country that Wallace would even ask such a question.

The short answer is that the rules of war (and the right is constantly reminding us that we are at war) allows us to kill our enemies, but to take them prisoner if they are manifestly trying to surrender. They do not allow us to torture our enemies under any circumstances. The final account we have of the mission is that OBL made no effort to surrender and he was therefore fair game to kill.

Tracking OBL down was a years-long effort that required painstaking work from our intelligence professionals, and by all accounts no single piece of information from the Bush years enabled us to track him down no matter how strenuously Cheney and others assert otherwise. And even if some information obtained from torture in the Bush years was a part of the mosaic that finally led to OBL’s lair, it in no way justifies employing torture as a tool of American national security policy.

The secret CIA prisons were an abomination as was the torturing of suspected terrorists, including the waterboarding 183 times of Khalid Sheikh Mohammed. The Bush administration surrendered to fear and weakness in resorting to such tactics and in doing so dragged the whole country with them into the muck.

The lesson of those years is that even in the darkest of times, we need presidential leadership that continues to expect the very best of what we are and then leads by example.  Obama has met that standard. Alas George W Bush did not.

George W. Bush Cancels Trip to Switzerland for Fear of Arrest for Torture

George W. Bush Cancels Trip to Switzerland for Fear of Arrest for Torture

George W. Bush’s plans to speak in Switzerland at a Keren Hayesod-UIA charity event on February 12th were abruptly cancelled. He was going there to speak about freedom and his time as president.

However, since he has admitted to authorizing torture, human rights groups around the world have organized and filed petitions for his arrest. The Miami Herald reports:

The New York based Center for Constitutional Rights said Saturday that European human rights groups had compiled a 2,500-page Convention Against Torture complaint against Bush, seeking to trigger it once he set foot onto Swiss soil.

CCR, a law firm led by New York civil rights lawyer Michael Ratner, has for years filed a series of mixed-result lawsuits against Bush administration policies, alleging civil liberties and human rights abuses in its detention, rendition and warrantless wiretapping policies.

“The message from civil society is clear,” it said in a statement. “If you’re a torturer, be careful in your travel plans. It’s a slow process for accountability, but we keep going.”

And Yahoo! reports:

The rights group World Organisation Against Torture (OMCT) this week called on Swiss authorities to open an investigation into Bush as former commander-in-chief of US forces if he sets foot on Swiss soil.

The Geneva-based OMCT on Thursday released a letter it sent to Swiss President and Foreign Minister Micheline Calmy-Rey to underline Switzerland’s obligations under domestic law and the UN Convention Against Torture.

It said that “all information suggests” that Bush “authorised, knew and acquiesced into the practices that constitute the crime of torture.”

The United States government will never hold Bush accountable for his crimes, but maybe if he’s not careful, a country with respect for international laws against torture will arrest him and hold him accountable.

Republicans Want to Extend the Bush Tax Cuts for the Rich and Bankrupt our Country

Republicans Want to Extend the Bush Tax Cuts for the Rich and Bankrupt our Country

All this week we are going to hear about Republicans arguing with Democrats about what to do about the budget-busting Bush tax cuts that are set to expire at the end of this year.  Republicans, fulfilling their role as funnelers of trillions of dollars in tax cuts to the very wealthiest Americans, are of course arguing for permanent extensions of the Bush tax cuts to everyone – including those earning over $250,000.  President Obama and most Democrats would like to see the tax cuts extended temporarily, but only for those earning under $250,000.  Without the compensation limit, the treasury would lose around $750 billion in tax revenues over the next decade. 

Yesterday’s news story suggests that the “compromise” may be to raise the threshold from $250,000 to one million dollars.

Maybe we should put this in perspective by looking back to a similar time.  Here is an excerpt from H.W. Brands’ biography of Franklin Delano Roosevelt, titled Traitor to His Class:

As for taxes, Roosevelt characterized a tax increase as “one of the most powerful weapons in our fight to stabilize living costs.”  Raising taxes would reduce Americans’ discretionary income and thereby diminish the upward pressure on prices.  It would also redistribute the burden of the war.  The wealthy were having a wonderful war:  profits and dividends were higher than in more than a decade.  Roosevelt proposed to eliminate loopholes that let the rich off easily and to boost tax rates sharply at the upper end.  “In the higher income brackets, the tax rate should be such as to give the practical equivalent of a top limit on an individual’s net income after taxes, approximating $25,000.  [$336,963 adjusted for inflation.]”  This was strong stuff, amounting to a confiscatory marginal rate on the highest incomes.  But it was no more than what he proposed for corporations.  “We must recapture through taxation all wartime profits that are not necessary to maintain efficient all-out war production.”

Before the war, Roosevelt had defended similar, albeit less ambitious, measures as promoting economic and social equality.  He still emphasized equality, but with a wartime twist.  “Such provisions will give assurance that the sacrifices required by war are being equitably shared.”  Redressing inequality was crucial, now and for the future.  “Next to military and naval victory, a victory along this economic front is of paramount importance.  Without it our war production program will be hindered.  Without it we would be allowing our young men, now risking their lives in the air, on land, and on the sea, to return to an economic mess of our own making.”

…The president didn’t quite get the confiscatory rates he wanted on incomes over $25,000, but he came very close.  The Revenue Act of 1942 pushed personal tax rates to a marginal maximum of 88 percent even as it reduced exemptions and nearly tripled the number of people subject to income taxes.  A special “Victory Tax” took 5 percent of all incomes over $624 [$8,411 adjusted for inflation], with a portion to be remitted after the war was won.

Granted, economic times in 1942 were not exactly the same as they are in 2010.  In 1942 the country was recovering from a deep depression and had been involved in an expensive world war for about one year.  The war effort had provided many people jobs for a couple of years, and inflation was on the rise.  Unlike then, as we begin to recover from The Great Recession, inflation is not an issue because unemployment remains high resulting in lower consumer demand for goods and services.  Deflation is the greater concern. 

In 1942 congress raised the top marginal rate to 88%.  The top rate now is 35%.  Today’s Democrats want to raise it to 39.6%.  In 1942, the threshold for income subject to the highest rate was $336,963 in today’s dollars.  Republicans would like to hold the top marginal rate at 35% and, if they have to compromise, might agree to a repeal of the Bush tax cuts on incomes over $1,000,000. They’ll probably filibuster the bill if the income level falls below that.

If we had a responsible president and congress from 2001 through 2008 we wouldn’t be having this debate.  Why?  Because only a servant like Bush would have sacrificed the federal budget and the economy to shovel more money to the super rich – his “base.”  Unlike Roosevelt, Bush never asked the rich to sacrifice anything to pay for his “war on terror” that has gone on far longer than World War II.  And since Bush declared war on a noun instead of a country or an organization, the war will go on forever.   The very rich should have been asked to sacrifice by paying more in taxes to fund the never-ending war.  Instead, Bush gave them huge tax cuts as their incomes rose dramatically and everyone else saw little or no gains.  As a result of Bush’s policies favoring the rich, the economy has staggered, unemployment is high, and income inequality has reached a peak never before seen in our history.  

Now is not the time to extend insane tax breaks for people who currently receive 80% of all income earned in this country.  Now is the time for them to start paying more.  Their tax dollars are needed to extend unemployment benefits, provide jobs through infrastructure rebuilding projects, and fund our social safety nets.  Republicans aren’t going to let that happen because it would go against their short-term political goal of reducing deficits now when we should be spending to spur demand for goods and services; and it would go against their long-term goal of dismantling all government entitlement programs so that even more money can go to the rich. 

If congress is serious about growing the economy in ways that provide jobs and decreasing long-term deficits without leaving people stranded without basic services, then they need to raise taxes on the rich.  The rich have the most of the money.  The Democrats should be fighting hard to raise their taxes, but it looks like they are once again going to compromise their principals to satisfy the demands of a pugnacious minority party.