Article first published as Economic War Declared on the American Middle Class on Technorati.
If you’re a middle or working class American, whether or not you accept it, we’re all in the same boat, and we just had a shot fired across our bow. The co-chairs of President Obama’s deficit reduction commission released their initial proposal late last week and made one thing perfectly clear — they believe our nation’s fiscal problems must be corrected on the backs of working Americans.
The National Commission on Fiscal Responsibility and Reform was created by executive order this past February. The commission’s primary mission was to identify “policies to improve the fiscal situation in the medium term and to achieve fiscal sustainability over the long run,” and also to “propose recommendations designed to balance the budget, excluding interest payments on the debt, by 2015.”
It’s difficult to fault either the notion to form the commission or the assigned mission. The group was even structured in a bipartisan manner, requiring that no more than 10 of its 18 members be of a single political party. But if the co-chair proposal is any indication of the content of the final report that’s due for commission vote by December 1, then it’s now evident that class warfare has been waged in America, and the two major political parties have allied against the interests of the majority of citizens.
Fortunately, there may still be hope that this isn’t the case, that the co-chair’s full frontal assault on working Americans will not receive the 14 votes needed to move forward. The proposal, as released, is the work of former Republican Senator, Alan Simpson, and Erskine Bowles, who served as advisor to President Clinton.
Simpson’s politics are certainly no mystery, as evidenced by the abusive e-mail he recently sent to the executive director of the National Older Women’s League where he described Social Security as being “like a milk cow with 310 million tits.” And while Mr. Bowles is purported to be a Democrat, his views put him squarely in the DINO (Democrat in name only) camp. He is an investment banker, formally employed by Morgan Stanley, on whose board he still serves, and the co-creator of his own investment firm.
Whether the severe anti-middle-class slant to the present proposal is upheld by the larger commission or not, there is no escaping the elitist agenda of the co-chairs. Their 10 “Guiding Principles” starts with the solemn acknowledgement that we must “come together on a plan” to “get this crushing debt burden off our back.” And the second principle is like the first, stating that “A sensible real plan requires shared sacrifice.” But sadly, the Simpson/Bowles idea of who exactly needs to participate in said sharing is limited to middle and working class Americans.
The Simpson/Bowles plan does contain a significant number of spending cuts, with illustrative examples that total over $200 billion in 2015 that are interestingly split between domestic and defense expenditures. And while one might wonder why we can trim only $100 billion from a defense budget that’s over $1 trillion — more than that of all other countries combined — or how adding to unemployment by cutting 440,000 federal jobs is going to help the economy, it’s really the proposal’s tax reform recommendations that expose the co-chair’s corrupt idea of shared sacrifice and total disregard for working Americans.
In order to gain clarity regarding the co-chair’s glaringly regressive economic philosophy, one really need look no further than the “goals” they set forth for tax reform: the first of 7 goals is to “Lower Rates” and at the end, in seventh position is “Reduce the Deficit.” A more upside-down prioritization for a “deficit reduction” commission is hard to imagine, but even worse is the fact the detailed recommendations are heavily skewed toward benefitting the wealthy, with a few bones for the poor and a tab that’s picked up by everyone in the middle.
With working America still struggling in the wake of an economic calamity that stripped away as much as a third of the overall wealth of the middle-class and fed the proceeds to rich Wall Street bankers, Simpson and Bowles actually have the temerity to recommend that the few tax advantages held by the vast middle of American wage earners be ended. This would be bad enough if proposed as the mainstay of deficit reduction, but this is not the case. The dynamic duo would use most of the increased revenue, not to reduce the deficit, but to provide steep cuts to the top marginal and corporate tax rates.
The co-chairs propose to slash taxes for the rich by dropping the top marginal rate from 35% to 23% and the corporate rate from 35% to 26%, the combination of which will ADD tens of billions to the deficit. Their proposal also includes restrictions that will prevent Congress from collecting taxes on businesses, like Exxon which had $42.5 billion in 2009 profits and paid ZERO in U.S. income tax.
But never fear, this pair of elitist scoundrels will pay for their proposed tax breaks by eliminating the home mortgage interest deduction and subjecting healthcare benefits to taxation. They’ll also impose co-pays for veterans who use VA hospitals, raise fees at national parks and start charging admission to the Smithsonian museums, and force college students to make interest payment on loans while still in school. It’s time to bend over middle class, because that upper one 1% now make 23.5% of all U.S. income, and they need a tax break.
The “deficit reduction” label of this proposal is nothing more than a rhetorical smokescreen for the “starve the beast” crowd of conservative ideologues to further their goal of plutocratic rule. The gross concentration of wealth in America already has the top 1% holding more than the bottom 90% — a situation that hasn’t existed since the last time the economy collapsed in such grand fashion — the Great Depression. This proposal will only increase that disparity and hasten the American people’s race to the bottom.