Where 30 Years of Real Class Warfare Has Left America

[dajoki]

Where 30 Years of Real Class Warfare Has Left America
Larry Womack
Former Associate News Editor, The Huffington Post
Posted: 8/24/11 04:09 PM ET
http://www.huffingtonpost.com/larry-womack/30-years-of-real-class-warfare_b_932279.html

There's a novel idea being championed by Republicans this month. Everyone, from Mitt Romney to Rick Perry and Michele Bachmann, seems to believe that the problem with the tax system is not that the very rich get off too easy, but that the very poor do. In fact, Republicans in Congress sound pretty eager to see payroll taxes on working Americans rise again in January.

This should strike most people as odd, since the super rich in this country are taxed just 17 percent of their earnings while the rest of us fork over around 36 percent. But the argument, Dallas Tea Party founder Phillip Dennis explained to Hardball viewers last month, is that, "The top one percent pays fifty percent of the taxes in this country."

"What," he asked, "about the bottom forty-eight percent who doesn't pay anything?" Yes, really: Americans are being asked to believe that if the top 1 percent managed to match the bottom 99 percent (which pays a rate more than twice as high,) that this would be evidence not of a truly breathtaking national wealth gap, but of a downtrodden upper class.

No one in America can leave their home, eat a meal, make a phone call or even turn on the lights without paying some sort of a regressive tax that disproportionately affects the poor and working class, so the premise of Dennis' argument is just factually untrue. What is true is that many Americans pay no federal income tax, because it has a progressive structure to counter that effect. It even manages to shake out surprisingly equitably among the poor and middle class, with those earning anything between $20,000 and $500,000 per year handing over a whopping 40 percent of their income to the government one way or another. Only the super rich seem to get off relatively easily, contributing just 17 percent.

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This return to pre-depression insanity is the result of three decades of real class warfare stretched over three Republican and two Democratic administrations and every imaginable combination of legislative control. In this bizarre new America, the fantasy of supply-side economics lingers, now usually in the form of a "job creator" talking point. (You know what really creates jobs? A working class capable of making purchases.) So today, any suggestion that the wealthy aren't paying enough is branded class warfare, but "a broad-based, regressive increase" targeting the working poor might be just what the doctor ordered. As a result, the super rich are charged a before-deduction tax rate that is half of what it was under Nixon and a real tax rate that is half of what their secretaries pay. It's income redistribution, alright -- from the bottom, which pays taxes, to the top, which does not.

We also leave people born to poor families disgracefully little opportunity to become one of those wealthy tax-dodgers we're so intent on pampering. The United States bills itself as the land of opportunity -- and when it comes to politics, nobody has anything on us. Our dirty little secret is that when it comes to economics, that couldn't be furtherfrom the truth. In fact, the U.S. offers its citizens the very lowest chance among wealthy nations for upward intergenerational socioeconomic mobility. If you're born to a poor family in America, you're probably going to die poor, too -- and so will your children. Unless, of course, you or they manage a move to Denmark.

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