President Obama’s proposed 10-year budget has Republicans and the very wealthy screaming “class warfare”.
Only if they want it to be.
Let’s consider it economic correction of fiscal inequality started 30 years ago with voodoo Reaganomics. The fallacy of the “trickle down” theory, in which all the money that businesses and the wealthy received in tax breaks was supposed to trickle down into the pockets of the lower and middle class, was just that – a fallacy. Instead, it just stayed in the pockets, or bank accounts as it were, of the businesses and the wealthy.
For 30 years the wealthy got wealthier, and helped usher in a new gilded age. There was no such thing as too much of anything and excess was the norm. One home, or mansion, was not enough. A private jet shuttled them between homes scattered around the world. Want exposure for your business name? Buy a sports team and build a new stadium. Need a little gift for your trophy wife? How about a $3,000 Chanel handbag or a $30,000 bauble from Tiffany’s?
Oh, and the kids. They had to be in the right private school, leading to prep school and private college, preferably an Ivy League school. Grades not good enough? Not to worry. Daddy can lavish an endowment on the school and you will be welcome with open arms.
No need to worry about taxes. Hire a good tax attorney to find loopholes and get a secret bank account in Switzerland. Oh, granted there was that little problem of raised taxes when Clinton was president, but that was taken care of when Bush was put in place.
However, all that excess came at an expense. Well, not to them, but to the rest of us, bowing under the weight of stagnate wages and higher taxes.
According to William G. Gale of the Brookings Institution, “If inequality was growing because everyone’s income was growing a lot – but the rich were just growing faster – then it might not be that much of an issue. But what has happened in the last 10 years is that incomes at lower and medium levels have stagnated while the rich have gotten really rich.”
Lawrence H. Summers, President Obama’s top economic advisor likes to explain it this way, “The increase in inequality meant that each family in the bottom 80 percent of the income distribution was effectively sending a $10,000 check, every year, to the top 1 percent of earners.” (NY Times)
But now, President Obama has a message for those who got rich on Reagan and Bush “voodoo” economics. It’s time to take the burden off the middle class and pay your fair share. It’s time to reverse the economic inequality of the past 30 years.
The president plans to increase spending for college grants to give every student the opportunity to attend college and put our country back in the running for educational gains. College is not meant to be just for the rich, it should be accessible to all, and as the President says, it’s patriotic to stay in school. “Your country needs you to stay in school.” And now, he plans to help them achieve a higher education.
Health care and its high cost are also taking an enormous toll on the middle class income. President Obama plans to overhaul our inept health care system and reduce expensive insurance premiums that are now out of reach for most families.
Rebuilding our country’s infrastructure (those highways and bridges for those BMW’s and runways for the private jets aren’t free) as well as implementing green energy and scientific research is also on the docket. These will provide job opportunities as well as improve our standard of living - for everyone.
President Obama plans to pay for all of this by sharply raising the taxes of the rich and reducing taxes for everyone else.
Did you hear that? WE get the tax break!