Taxes

It is true, as I understand it, that the modest amount of progressivity left in the Federal tax code means that most income taxes are paid by people who are at least moderately well off. It is also true that Federal income taxes, proper, are only a part of the overall tax burden, and when you factor in other taxes (FICA, sales taxes, gas tax, state income tax, real estate taxes) the overall tax structure in this country becomes regressive (poorer people pay a higher percentage of their income in taxes, overall, than rich people, and MUCH lower than the super-rich. That is a reason activists often give in explaining why having rich people pay more in income taxes is fair.

But there's another reason I think is even more important. Wealth, ALL wealth, ultimately derives from profits - i.e., from something like a rent for the use of your property - and not from labor. This is true even if a high income is disguised as salary. NOBODY's labor is "worth" more than 200 times the median. Ultra-high CEO salaries come from their ability to control property (their own, and that of shareholders).

And profit is essentially a privatized tax - a tax that we pay on every good and most services that we consume, but that goes strictly to the benefit of a small class of individuals. (Small in percentage population terms; rather large in absolute numbers.) Profit represents the owning class blackmailing us by threatening to withhold the means of production, which would mean that we could not, with our labor, produce anything at all. And the more that wealth becomes concentrated, the stronger the stranglehold that property has on us, and the more they are able to squeeze out.

What progressive tax rates do, in a capitalist society that refuses to simply expropriate private owners, is to reclaim part of that private tax, for the public benefit. More progressive tax rates actually represent a LOWERING of the private tax that is capitalist profit.

And that is why progressive taxes are fair.

Presidency, democracy and stuff

I have just finished reading three big books on the U.S. System of government:  Michael Glennon's "National Security and Double Government", Arthur Schlesinger's "The Imperial Presidency", and Andrew Rudalevige's "The New Imperial Presidency".  It struck me that not one of the three authors EVER mentioned anything that could be construed as class politics.  Class issues did not cross one of their minds, apparently, even once, in the writing of these three works.

Nor did any of them seriously question whether there were any alternatives for democratic governance to the model the modern world mostly uses, involving relatively small deliberative/legislative assemblies, elected periodically by an otherwise largely passive electorate.  All three did devote some discussion of the question of whether a democratic government needs a strong executive, with all three ultimately concluding that it does.  Only Schlessinger devoted any pages to the question of whether the executive should be fully independent of the legislative branch, as in the U.S. system, or nominally answerable to it, as in the British system.  He ended up concluding that the U.S. system is better, because the British system ends up placing more  de facto power in the hands of the executive, not less.

The only writer on politics that I can recall discussing the larger structural question, besides anarchists and radicals rooted in the New Left, is Robert Dahl, in "Democracy and Its Critics", who terms the system we use "polyarchy" ("rule by many"), and, after discussion of its limitations from the standpoint of democratic ideals, decides that while not a perfect democracy, it is the best democracy we can get.

One important distinction between the three books I just read was that both Schlesinger and Rudalevige focus is on what might be called the constitutional structure of government; they assume the powers of the branches, as defined in the Constitution are the things that matter, for instance, that the President really is in charge of the powers of the executive branch.  Only Glennon's book addressed what might be called the shadow government, the fact that institutions take on a life of their own and may possess a power structure functionally much independent of the nominal hierarchy, especially when those institutions are under a secrecy regime such as pertains to our national "security" infrastructure.  The only other reference I can recall reading to this sort of effect is in Richard Parker's biography of John Kenneth Galbraith.  Parker reported Galbraith's impression that, during the Kennedy administration, the military establishment, if they didn't like a Kennedy directive regarding Vietnam, would simply ignore it.  According to Galbraith, Kennedy frequently complained of his inability to get things done.

The whole premise of a democracy is that the people, in some way, shape and fashion, somehow govern themselves.  All of these books I mention show aspects of the complicated problem of government that, in our current, alienating systems, most such nominally self-governing people, never, ever think about.

Speaking the truth, precisely

“Nella politica di massa dire la verità è una necessità politica, precisamente.” - Antonio Gramsci

That Gramsci quote has been the tagline to my personal email account for quite a while, now.  “In mass politics, speaking the truth is a political necessity, precisely.”  It is one of my all-time favorite quotes.  I think about it all the time.  What does it really mean?  Not so much to Gramsci, but to me.  It flies so much in the face of most “pragmatic” political thinking, which is all about how you present the facts, phrasing, paraphrasing, restructuring, eliding, evading, to “win hearts and minds”… guided by your polls and focus groups.   Political activists, even left ones, usually seem perfectly complacent with some version of Plato’s “noble lie”.  But not Gramsci.  “..to speak the truth is a political necessity, precisely.”

Lately, I’ve been thinking the difference is one of goals.  If your goal is to win elections, even if your goal is to make people’s lives in some way materially better, then strategic lies and half-truths may be helpful.  If your goal is to emancipate people, then to speak the truth, as precisely and clearly as you can, becomes an urgent necessity.  You cannot free people with a lie.  The best a lie can do is to help them exchange one chain for another.

(I wrote about another take on this quote back in July of 2010.)

Government control

One “common sense” argument put forth against socialism, in the (limited) sense of direct government control over the economy, is that the government cannot be trusted to invest wisely.  They may keep non-viable enterprises going, for example, pouring in money drawn from better-performing portions of the economy, in order to win votes.

As a prima facie argument, this strikes me as silly.  After all, private capitalists cannot be trusted to invest wisely, either, and to the extent that they do, they invest for their own benefit, not ours, and the public weal follows as a side effect, if at all.  It’s not that I don’t believe in the existence of the “invisible hand”.  I just think its reach only extends so far.  Maintaining jobs in a money-losing business that produces a useful commodity may actually be a perfectly reasonable public investment in some circumstances, but not one that would ever appeal to the private capitalist.

On a more detailed, implementation-focused level, of course the anti-socialist objection is not entirely ridiculous.  If we have publicly managed investments, we do want them to be managed well, and managing investments well is not a trivially easy job.  We also need to protect ourselves from outright corruption.  Addressing these issues is partly a matter of management, of checks and balances, of trying to design a system as free as possible from irrelevant, systematic distortions.  But to get a well-balanced, robust plan of public investment that takes all direct and indirect costs and benefits into account, I think we would need a much more participatory planning process.   (Note that taking ALL direct and indirect costs and benefits into account is something that capitalist enterprise management NEVER does.)

Can we get a suitable democratic planning process within our current models of government?  I do not believe in the blanket statement, asserted by some on the left, that “you cannot tear down the master’s house using the master’s tools.”  But some of the master’s tools are in fact rather specifically engineered to serve the master’s purposes, and are not so readily adapted to the needs and purposes of the folk.  In my mind, our really-existing systems of representative government are examples of such tools.

Representative governments originated, in Europe, as a way for kings to appease the aristocracy, and eventually the richer bourgeoisie, without ceding too much central control.  Some constitutions, of course, were constructed as a conscious break with the rule of kings; however, the one such “revolutionary” constitution I know something about – our own in the U.S. – was consciously created to keep hoi polloi at arm’s length, and guarantee effective control by the richer classes.  Obviously, there have been modifications in these constitutions over the centuries, most of which (I think)  have been in the direction of greater democratization, but there still is a long way to go.  Most ordinary folks participate in democracy only by spending ten minutes every 2-4 years in voting  (if they even do that).  “Debate” takes place between politicians and pundits in the commercial news media (primarily), and is, to most people, at best a spectator sport.  People’s own discussions tend to take place amongst small groups of their own friends, and can influence the broader process of policy formulation only to the extent they happen to be queried through the passive (and eminently manipulable) process of polling. 

A truly democratic process would have people involved in interactive debate, with both themselves and opponents as participants; a debate taking place in a public forum that fed directly into the decision making process.  Listening to arguments pro and con, and being forced to make a meaningful decision afterwards, focuses the intelligence, I believe, like almost nothing else.

The punditry would assure us that people just don’t want to be that involved in their own government.  Maybe that’s only because they’ve never had the chance.

Isocrates and us or “plus ça change, plus c'est la même chose”

 “When I was a boy, being rich was considered so secure and honorable that almost everyone pretended he owned more property than he actually did possess, because he wanted to enjoy the prestige it gave.  Now, on the other hand, one has to defend oneself against being rich as if it were the worst of crimes… for it has become far more dangerous to give the impression of being well-to-do than to commit open crime; criminals are let off altogether or given trivial punishments, but the rich are ruined utterly.  More men have been deprived of their property than have paid the penalty of their misdeeds.”

This was the Greek, Isocrates, writing I guess in the early 4^th Century BC.  The thing is, if de Ste. Croix is correct in his analysis in The Class Struggle in the Ancient Greek World,  Isocrates wrote these words during a time when, in fact, economic inequality was growing in much of the Greek world.  The demos was on the defensive; the oligarchic sector was (correctly) realizing that their interests were better served by supporting outside imperialists like Phillip II of Macedon (and his successors), who would permit them free reign to squeeze the local peasantry, as long as they eschewed outright political ambition beyond the local level, but would be very suspicious of the potential for a popular uprising by hoi polloi.  And, in fact, under, first, the Macedonian kings, and later the Romans, the last vestiges of democracy were stamped out, opening the world to more and more vicious exploitation of the poor and middling by the uber-rich, until finally the Emperors Diocletian and others basically enserfed the entire population below the economic and political elite.  Economic, and political, inequality in the late Roman Empire reached a level that we, in our still relatively open societies, can barely conceive.

The thing that bothers me about the Isocrates quote I opened with is that it seems so modern.  We again find ourselves subject to “poor me” complaints from the rich, fuming, for example, that they pay the lion’s share of income taxes (but taking as a natural right their claim to an even more disproportionate share of the fruits of economic production), and decrying the slender benefits allotted to the “undeserving” poor; calling for us to be tough on crime (while we imprison, in the U.S. more of our population than any other country in the world, and more black men than were slaves  before the Civil War), and for tax cuts for the “creators” of (mostly non-existent) Mac-jobs.  So, while financial markets soar post-depression, we cut unemployment benefits and food stamps in time for Christmas, and produce movies in which criticism of the excesses of the corrupt ruling class is so muted that members of that class can cheer at screenings, while critics on the left complain, in effect, that the director is praising with faint “damns”.

And I think:  It’s been 2400 years.  Why are we still fighting the same fight?

Occupy Wall Street

They re-occupied Wall Street, yesterday. The mainstream media seems to be largely blacking it out, and it's hard to tell exactly what is happening. The crowd in photos looks smaller than some Occupy internet sites have claimed. I suspect the forces of the City of New York, and possibly the Federal Government, will come down on them like a ton of bricks - certainly if they pitch tents, or seem to be assembling in too much strength. I suspect the near-certainty of this will keep a lot of prudent potential protesters away. Still, the mere fact that this is happening causes profound emotion to well up from my heart to my tearing eyes.

I love the Occupy movement with a surprising, deep intensity. It is the source of much frustration, true. But the sins of the Occupiers are those of naivete, mostly. Their strengths are hope, inclusion, solidarity, love, and pure heart. Compare this to a mainstream culture based on self-interest, greed, hypocrisy, and the exercise of naked power. Not much choice, is there?

I do not know how to go about building a better world. As U.S. and global political and economic centers grow stronger, more concentrated, and more adamantly resistant to change, I grow less and less certain that it is even possible. But I do know that whatever limited powers of intellect, knowledge, ability I may possess, I'd rather throw them on the side of love and hope than greed, aggression, and repression. I know which side I'm on.

My favorite Occupy chant expresses, I think, both the sometimes childlike innocence of the movement, and its enthusiasm and unlimited, but unselfish, ambition:

"Occupy Wall Street. Occupy Main Street.
Occupy EVERYWHERE and NEVER GIVE IT BACK."

 

Subject for Debate

It is not surprising that the debates fail to satisfy.  (I admit I didn't watch them.  A few minutes of Romney's wild eyes and wilder lies, and I was ready to puke, and changed the channel.  But I'm responding to the post-debate coverage I've read, both in the news media and on Facebook.)

You can't squarely and honestly address the issues facing this country unless you address the issue of class; to wit, that the rich and powerful are and have been systematically looting the working class both of this country and the world.  (This is the actual class that includes the working poor plus the bulk of that which we disingenuously refer to as  "the middle class" in our political debates.)  They have been doing this since time immemorial, generally with the full help and support of government.  This was mitigated for a brief time, due to working people's revolutionary struggles and the rise of unionism in the late 19th and early 20th Centuries. The post-WWII prosperity then eased the pressure (there was so much wealth to be generated, that the rich could be convinced to share).  But since the mid-70s the rapine has resumed, and steadily intensified in force.  Extreme inequality was a driving force behind the economic collapse of 2008, and our government (a milquetoast Presidency and a recalcitrant Congress) ensured that, while working people got some palliative measures (a stimulus package, payroll tax cuts, unemployment extensions), which actually lessened our pain compared to, e.g., Europe, the rich essentially got made whole, and certainly were not asked to pay for their crimes.

But neither of the major U.S. parties can address this issue, since they are both entirely beholden to the capitalist class.  Our Constitution, and our private cash-driven electoral system ensure this.  I'm not a believer in the strategy of "Down with the Elephant, Down with the Ass."  While I would love to see an effective (i.e., election-winning) "Party of the Working Class,"  I have yet to see one with a credible plan of building mass American support.  Working within the Democratic Party has been somewhat more effective in my lifetime, but frustrating also:  for all the so-called "progressives" we sometimes manage to elect, we can't seem to shake the identification of the Democrats as the kinder and gentler of the parties of the elites.  Money is too influential, leadership too powerful, and even our "progressives", once in office, are often too willing to go along to get along.

I don't have a solution.  We need an effective, yet revolutionary politics if we are ever to break the stranglehold of wealth over our lives, and I frankly can't see where that politics is coming from.  But an honest recognition of the problem has got to be the first step.

P.S. The quote above is from an old Socialist chant, "Down with the Elephant.  Down with the Ass.  Let's build a party of the Working Class."

Casinos, capitalists and class struggle

The rush of Massachusetts to build casinos and other gambling dens makes me crazy.  The casinos are sold to us as a jobs program - this is almost a pure scam.  It is as if the 1% were to hire a small number of the 99% to construct, and then operate, a gigantic vacuum cleaner, the sole purpose of which was to suck money out of the pockets of the 99%, and deposit it in the bank accounts of the 1%.

Compare this with a genuine jobs bill - the Conyers bill, HR 870, which would tax the 1% (through a small financial transactions tax) and use the proceeds to hire some of the 99% to build and repair things (schools, roads, bridges) that belong to the 99%.

In today's political parlance, the second bill – the genuine jobs bill – is considered class warfare.  Casino construction, which employs some people to better exploit others, is not.  Essentially, "class warfare", for the punditry, is a term used to describe anything that acts effectively to the detriment of one specific class - the ruling class.

Even a casual student of Marx knows that the class struggle is not an option - something one chooses to engage in, or not.  It is an inevitable side effect of a class society.  As long as the economy is structured so that one particular class – feudal landowners, slave-owners, or capitalists – derives its income solely and explicitly by the exploitation of others (aka the workers), then you have a class society, one feature of which will be a struggle over the degree of exploitation.

A Keynesian analysis of a capitalist economy suggests there may be some "sweet spot" for the capitalist class, a level of wages that balances off increased demand and economic activity against a reduced profit margin, so as to maximize the capitalists' overall net income.  But there's no magic way to detect this "sweet spot", and the capitalists' greed is such that they will tend to overshoot when it comes to driving down wages.  Also, manipulating the overall wage rate in the economy, so as to manipulate demand, is beyond the power of most individual capitalists, or even cartels. 

At a given level of output and technology, the individual capitalist can only increase his income by increasing the level of exploitation - his profit.  Any such increase in profit comes directly out of the worker's wages.  So struggle is inevitable.  The only question is whether the workers resist low wages individually (in which case the majority of them are bound to lose), or collectively, through labor unions and political action, in which case they have a chance.  It is this latter form of collective struggle that the right wing insists on calling "class warfare".

A genuine jobs bill, like the Conyers bill, would strengthen the working class, lessen inequality, and make the 99% genuinely better off.  The casino alternative plays some in the working class against others, and its overall effect is to further the impoverishment of the 99% with respect to the 1%. 

Some with in the Occupy movement have started saying "They only call it 'class warfare' when we fight back."  I would add that they only call it "class warfare" when we adopt a strategy that might actually win results.

That’s not the American Dream...

I’ve had people tell me that the so-called “American Dream” is about the idea, however false, that anybody can get rich.  Therefore, they argue, if your politics tries to clip the wings of the very rich, people feel you are choking off their dreams, and they won’t support you.

I won’t deny that there’s some truth to that, and if the issue of class fairness is presented the wrong way, you might get that reaction.  But I don’t think the American Dream is really about the ability to get filthy rich, and I think if you frame your arguments the right way, you can get around this obstacle.

Now, everybody has occasionally fantasized about what it would be like to be just stinking rich.  But I don’t think Americans feel that helping some people to get rich is a matter of justice.  I had to frame that sentence carefully.  If I had said “allowing some people to get rich”, a lot of people would think that was just.  To arbitrarily prevent some people from getting rich, “just because”, would be seen by many of us as simply mean.  But if you frame the question in terms of what others would have to give up for that person to become rich, then people hear a different story.

The American Dream is really about the idea that anybody, maybe even everybody, can do well.  It is about prosperity, not opulence.  You should be amply rewarded for a lifetime of honest work, and if you’re especially clever, or work especially hard, you should have a proportionate increase in your level of well-being.  That just strikes most of us as fair.  You should be secure in your enjoyment of these things.  You should do well enough that you can enjoy a few hobbies, and leisure time with your family.  When you’ve paid your dues for 40 years or so, you should be entitled to a comfortable retirement.  You should also have the right to feel confident that your children, and your children’s children will have the right and ability to enjoy the same comforts and opportunities that you have.  This is what the American Dream really means, to most of us.

What we need to get people to understand is that some people’s ability to become super rich, if it is realized, chokes off this dream of prosperity for the rest of us.  When 1%, 2%, even 10% of the people receive half of the total income produced by society every year, and lay claim to more than 70% of the total wealth, they do this by squeezing it out of our paychecks, out of our public or common goods (parks, roadways, schools), out of our healthcare, our retirement – lately, out of the equity that could have accumulated in our homes.
The vast wealth of the lucky few has been justified to us on the basis that they are somehow the engines of economic growth, that they are “job creators”, that their enormous wealth is somehow necessary for the rest of us to be prosperous.  We have now had nearly two generations of experience to prove that that is a lie; that policies to benefit the super rich not only don’t help the rest of us, but actually do us harm.

Since the mid-1970’s, when neoliberal talk of “job creators” and “trickle down economics” began to take hold, the richest 10% increased their share of national income from about 1/3, where it had held pretty steady since the early 1950’s (and which already meant they made between 4 & 5 times, on average, as much as the rest of us), to reach 50% about 2007.  Did this make the rest of us better off?  Total employment did grow a little, at the beginning of that period, before it crashed at the end of it, but it had been pretty stagnant for nearly a decade before the crash.  And how much of that “expansion” in jobs represented low wage, no benefits “Macjobs”, replacing the good “middle class” jobs that people had lost?  And our sense of security in a prosperous future for ourselves and our children has virtually disappeared. 

Trickle down economics does not, and never has worked.  Many, if not most, of the people who originally espoused it never really believed it would.  It was a convenient lie to justify their rampant looting of the economy.  It’s time we put an end to it.  We must put an end to it, if we are ever to reclaim the real American Dream.

“I have seen good working people, Throughout this mighty land. I’ve prayed we’ll get together, And together take a stand. “Then we’ll own those Banks of Marble, With no guard at any door. And we’ll share those vaults of silver That we all have sweated for.”