The Not-So-Straight-Talk Express--Riding Economy Class

Having now seen several good points from Eric defending continued, and, in some cases, increased, deregulation of the economy and increased overall tax cuts, it’s important to highlight several problems with this argument. Alongside some hard facts are some lines straight out of the Republican playbook that they’re hoping you’ll take at face value. First of all, I have to take issue with Eric’s assertion that Obama is practicing “class warfare” to secure the democratic base. (see the first paragraph of “Obama moving right on taxes”, sept. 16th). Based on the figures released by the non-partisan Tax Policy Center, (TPC) Obama is in fact increasing taxes for the wealthiest tax bracket by under 2% of their income, averaging $19,000 more for them. This is done to enable Obama to cut taxes for the vast majority of the rest of taxpayers while still paying for increased services such as healthcare for all U.S. children. (Handily enough, the TPC also compares the candidates’ health care proposals in the same report.)

I fail to see how a slight increase in taxes for those who can easily afford it that enables a more substantial fiscal “safety net” for everyone else constitutes class warfare. This has been a common throwaway conservative line when attacking any increase in taxation of the wealthiest. “Wealthy” is not a dirty word if that’s what you are. If there were any class warfare going on today, I would have to argue that the rich, as always, would win it. Wealth determines all whole host of quality of life issues in America. Let’s compare a child born to parents in the top 10% income bracket vs. one born into the bottom 30%. The wealthy kid will probably receive better health care and go to a better school. Wealthy children can take expensive courses that teach you how to beat the ACT and SAT tests. Poor children are more likely to join the military as a career, and hence to die in whatever the latest war is. People across the spectrum break the law, but money buys better lawyers. The victims of Obama’s “class warfare” have far more choices open to them, and a much better safety net should they get sick or lose their job.

Eric’s insistence that raising the minimum wage is “inflationary in nature” and is merely a “political ploy to garner votes from the working class” (“McCain’s plan more sensible…” paragraph 3) neglects to mention that inflation has been almost constant, with or without a rising minimum wage. I could go on, but this simple chart from the folks at Wikipedia demonstrates two things. 1) Real value of the Federal minimum wage has been falling since the late 1960s, and 2) minimum wage raises have happened AFTER periods of inflation, rather than merely causing them. (Oh, and the disparity of wealth in this country has been reaching heights not seen for decades, which isn't a good sign if you want a vibrant middle class.)


Lest I be accused of class warfare or compared to Chairman Mao, I shall say this: I am against any sort of misguided attempt to punish the wealthy. After all, they are often our most productive citizens. But, to paraphrase Obama when he was interviewed by Bill O’Reilly in late August, the wealthiest citizens can afford a slight increase in taxes, and that it was time to be “good neighbors.”

It should also be pointed out that Eric—like the McCain campaign, attempts to gloss over the fact that Obama’s plan gives more money back to the vast majority of taxpayers than McCain’s does. Almost all of the money McCain boasts about giving back to who Eric simply calls “taxpayers”(paragraph 1 of “McCain’s tax plan more…”sept. 17) is in the nearly 10% tax cut he will give to the wealthiest taxpayers. Why won’t McCain just say that up front, if this is really the fairest and best plan? Instead, McCain has repeatedly—and falsely—claimed that Obama will raise most Americans’ taxes, despite non-partisan analysts assertions to the contrary.

As for Obama’s supposed strangling of small businesses via taxation, that too, is a distortion. For the full breakdown, see this excellent, concise analysis by Factcheck.org. What it essentially establishes, however, is that many small business owners will receive tax credits for providing health insurance for employees. Many others legally file their taxes as individuals, and would therefore only be significantly affected by Obama’s tax increases if they clear over $250,000 a year. Eric claims that the economy would be harmed by raised income taxes in the top bracket, even though they will remain below the level they were during the Clinton years. By the way, if Clinton’s taxes were too high, why were his two terms so great for the economy? That doesn’t seem to make sense, like most of the rest of McCain’s tax plan.

Never mind that economists like Alan Greenspan (a guy who supported the Bush tax cuts) warn that McCain’s plan won’t work, that cutting taxes so much without sufficient spending reductions will be terrible in the long run, and this plan won’t balance the budget, let along made a dent in the deficit. Like so much else of his campaign message, John McCain’s economic statements have cut loose from their moorings in reality and are adrift in a sea of cynicism, negative advertising, and overplayed Alaskan folksiness.

-Ian