Wednesday, March 16, 2016

So the problem is...


OK, it's not the problem, but it is a big one. The short version is that the political establishment, I mean both democrats and republicans, have been bought and paid for by "the one per cent," and have thus steered us to ruin.

The first thing is that marginal tax rates for the top income earners went from 70% (single; 55% MFJ if memory serves) to no more than 39.6% today. Most of that drop happened under Reagan, and nobody has even tried to push the top marginal tax rate back up.

This has been a disaster for our nation's infrastructure, by which I mean roads, railroad tracks, bridges, tunnels and so on. It has also been a disaster for public primary and secondary education, public universities and community colleges, parks, and so on. We still want a civilized society, but those best able to pay for it (the top 1%) have corrupted the political system; now nobody's paying, and civilization is disappearing.


I didn't vote for Clinton in 1992, but when he won the general election, I thought, "Well, at least he'll hold China accountable for all the repression of their own citizens…" Wow, was I wrong! China got permanent MFN, under Clinton I believe, and that accelerated us on the race to the bottom.

NAFTA and other free-trade agreements have benefited a lot of people, and hurt a lot of people: benefits came to the rich and near-rich; pain came to the poor and near-poor. Factories moved from the US to Mexico. But it's not just about US employees losing their jobs; it's also about US mechanized agriculture driving small farmers out of business in Mexico and elsewhere.

A Ray of Hope

Did you hear Rubio's speech March 15, 2016? It was religious! He quoted 1 Chronicles 29:11-13 and Proverbs 16:9, from memory I think. In this Marco was right on: our hope is not in politics or in candidates or in the reform of our political system. In fact every human system is corrupt, and although we should work to fix these systems, they are not our salvation. They are not our hope.

That said, even a merely human perspective allows us to see that corruption isn't as effective as some people want it to be. Who donated millions to try to limit President Obama to a single term? It didn't work very well. In California, the criminals at PG&E spent some 40 million dollars to support a ballot initiative that would strengthen their monopoly. That initiative was defeated decisively.

What must be done?

First, hold individuals accountable; jail criminals. That's right. Don't just fine the corporations; fines are a cost of doing business. Don't just fine governments that break laws; jail the individuals who make decisions. Who poisoned the residents of Flint, Michigan? It wasn't some machine; one particular person signed off on switching the water supply to a dangerous one; another person stopped the anti-corrosion treatments that raised lead content in the water to unsafe levels. These individuals knew they would never be held accountable; worst case, somebody might fine their agency or department.

Attorney General Lynch crowed about criminal indictments against Citigroup. That's horsefeathers; criminal indictments against a corporation mean absolutely nothing. Put the decision-makers in jail, like we did in the S&L crisis of the '80s; that'll mean something.

Second, tariffs! Business "leaders" say tariffs will provoke a trade war? Bring it on! Who's got more to lose in a trade war, China or us? Hint: Look at the trade deficit! The other thing about tariffs: products sourced or assembled in low-wage countries must be made more expensive to purchase in the US, in order to protect US jobs.

Third, raise marginal taxes on the One Per Cent! Make America great again by restoring the pre-Reagan tax rate schedules! Cap the limit on charitable deductions at 20% of AGI! Limit the mortgage interest deduction at something reasonable: $30,000 a year, say. Heck, even $100,000 a year.

What, you say, people won't be able to afford housing? News flash: they already can't afford housing. But if we stop the tax expenditures, guess what? Prices will drop, and builders will build more stuff people can afford by themselves.

You want a five-million-dollar home? Fine. You want the rest of the country to subsidize your mortgage payments? Forget it!


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