Everyone knows I'm a fan of taxing the rich and that I think most of the economic problems in our country have their roots in the growing inequality of the past few decades, so it should come as no surprise that I enjoyed the Cruickshank piece on Calitics. He's got exactly the right idea: Tax reform that benefits the wealthy (or, in fact, tax reform that doesn't force the wealthy to pay more) isn't tax reform at all.
I was on a houseboat at Lake Shasta over the 4th of July, arguing with some very smart people about why the economy is so fucked up (yeah, for relaxation I go someplace beautiful -- then sit around and talk about economic policy), and we covered a lot of ground. My friend the investment banker and corporate executive said that out-of-control CEO pay -- and bonus payments for failure, and lack of corporate accountability -- were a bit part of the problem. "If corporations succeed, then everyone -- all the people who work there, at every level -- ought to benefit," he pointed out. True: In the early post-War era, labor union clout in major industries (automotive, for example) forced corporations to pay a decent middle-class wage -- that is, to share the fruits of success with the workers. That's all gone now. "Corporations don't pay enough taxes," my friend the corporate salesman said -- and he's right, too.
And all of us agreed that higher taxes won't drive corporations out of the country or out of states or even out of cities; the actual numbers of businesses that pick and and move because of taxes (as opposed to labor-force issues, rents, land availablity, access to transportation etc.) is so minor it's not even worth talking about.
But those are just pieces of the puzzle. Here's what I always come back to: Over the past couple of decades, the size of the U.S. economy has doubled -- and real wages have been essentially flat. All that new money has gone to the very, very top. Robert Reich explain this brilliantly in exactly two minutes -- and I don't care how busy you are, you have two minutes to watch this video.
That, really, is the root of everything, the reason we're still in a recession, that people are losing their homes, that government debt is soaring ... it's all because this country, as a matter of public policy, has allowed the very, very rich to take almost all of our wealth. We have become a banana republic, a corporate kleptocracy, a place so badly managed that it we weren't the United States, the news media would be reporting on our utter lack of economic democracy. And they'd be saying that the system is so unsustainable that one way or the other, it's going to collapse.
Jerry Brown must know this. He's not going to run for another term. There's no excuse at all for not at least proposing a modest tax increase on the highest earners and the most profitable big businesses. Come on, guv: What are you waiting for?
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