Republicans and Jobs: More of the Same-Sop the Rich, Screw the Middle Class and the Working Poor

September 22, 2011 | By | 3 Replies More

The current political climate is one fraught with conflict and controversy promulgated and continuously created by the most extreme elements of the lunatic fringes of the right and the Republican Party. The Republican Party cares “solely and exclusively about its rich contributors” in America and the Middle Class and the working poor be damned.

Republicans will say anything, do anything, lie, cheat and steal about everything to protect the so-called “job creators.”  I’ve accused Republicans of puerile partisan political chicanery before but, the proof is in the charge made by a senior GOP Budget Committee staffer who quit Capitol Hill because of Republican “lunacy.”

This article is the first in a series of three analyzing the evidence of Mr. Mike Lofgren who spent 28 years on the GOP staff of the US House and Senate Budget Committees, and had much, including this, to say about the Republican love affair with only the corporations, millionaires and billionaires.  Mr. Lofgren says:

The GOP cares solely and exclusively about its rich contributors. The party has built a whole catechism on the protection and further enrichment of America’s plutocracy. Their caterwauling about deficit and debt is so much eyewash to con the public.

I wrote of the current tactics of the Republicans, especially in the US House of Representatives on the debt ceiling “crisis.”

Mr. Lofgren continues:

Republicans have attempted to camouflage their amorous solicitude for billionaires with a fog of misleading rhetoric. John Boehner is fond of saying, “we won’t raise anyone’s taxes,” as if the take-home pay of an Olive Garden waitress were inextricably bound up with whether Warren Buffett pays his capital gains as ordinary income or at a lower rate. Another chestnut is that millionaires and billionaires are “job creators.” US corporations have just had their most profitable quarters in history; Apple, for one, is sitting on $76 billion in cash, more than the GDP of most countries. So, where are the jobs?

Mr. Lofgren poses the best question to for Democrats to ask of his former Republican colleagues. Where are the jobs from the “job creators” among the corporations, millionaires and billionaires, Mr. US House Speaker Boehner? Eight years of George W. Bush and Republican “leadership” of the US economy led the nation into the Great Recession and the Lost Decade. The “Lost Decade” because there were only losses of private sector jobs under Bush and his tax giveaways to corporations, millionaires and billionaires.

Mr. Lofgren goes on to point out additional Republican rhetorical scams.

Another smokescreen is the “small business” meme, since standing up for Mom’s and Pop’s corner store is politically more attractive than to be seen shilling for a megacorporation. Raising taxes on the wealthy will kill small business’ ability to hire; that is the GOP dirge every time Bernie Sanders or some Democrat offers an amendment to increase taxes on incomes above $1 million. But the number of small businesses that have a net annual income over a million dollars is de minimis, if not by definition impossible (as they would no longer be small businesses). And as data from the Center for Economic and Policy Research have shown, small businesses account for only 7.2 percent of total US employment, a significantly smaller share of total employment than in most Organisation for Economic Co-operation and Development (OECD) countries.

Likewise, Republicans have assiduously spread the myth that Americans are conspicuously overtaxed. But compared to other OECD countries, the effective rates of US taxation are among the lowest. In particular, they point to the top corporate income rate of 35 percent as being confiscatory Bolshevism. But again, the effective rate is much lower. Did GE pay 35 percent on 2010 profits of $14 billion? No, it paid zero.

When pressed, Republicans make up misleading statistics to “prove” that the America’s fiscal burden is being borne by the rich and the rest of us are just freeloaders who don’t appreciate that fact. “Half of Americans don’t pay taxes” is a perennial meme. But what they leave out is that that statement refers to federal income taxes.

The whole Republican “half of Americans don’t pay taxes” scheme is misleading.  First, the number was 47% and second, because the Stimulus Plan was designed to reduce taxes for the Middle class and working poor and was imminently successful at that goal by providing lower tax levels and new tax credits for the Middle class which the Republicans later had stripped away at the end of the last session in order to keep the Bush era tax breaks for the top 2% of incomes in America. If you think that pointing out the 3% difference is minor on the Middle Class and working poor folks who got a one-time federal deal which Republicans took away, the amount of federal income taxes as a percentage of revenues is about 14%. The changes Republicans insisted upon at the end of last session took care of the top 2% of US incomes to the tune of $731 billion and screwed the 47% of Middle Class and working poor taxpayers who previously had a break of some $200 billion due to President Obama’s and the Democrats’ Stimulus Bill. Corporations kept their $110 billion in tax breaks from the Stimulus Bill.

Mr. Lofgren next points out the false claims of Republicans regarding who pays taxes in America and other schemes:

There are millions of people who don’t pay income taxes, but do contribute payroll taxes – among the most regressive forms of taxation. But according to GOP fiscal theology, payroll taxes don’t count. Somehow, they have convinced themselves that since payroll taxes go into trust funds, they’re not real taxes. Likewise, state and local sales taxes apparently don’t count, although their effect on a working poor person buying necessities like foodstuffs is far more regressive than on a millionaire.

All of these half truths and outright lies have seeped into popular culture via the corporate-owned business press. Just listen to CNBC for a few hours and you will hear most of them in one form or another. More important politically, Republicans’ myths about taxation have been internalized by millions of economically downscale “values voters,” who may have been attracted to the GOP for other reasons (which I will explain later), but who now accept this misinformation as dogma.

And when misinformation isn’t enough to sustain popular support for the GOP’s agenda, concealment is needed. One fairly innocuous provision in the Dodd-Frank financial reform bill requires public companies to make a more transparent disclosure of CEO compensation, including bonuses. Note that it would not limit the compensation, only require full disclosure. Republicans are hell-bent on repealing this provision. Of course; it would not serve Wall Street interests if the public took an unhealthy interest in the disparity of their own incomes as against that of a bank CEO. As Spencer Bachus, the Republican chairman of the House Financial Services Committee, says, “In Washington, the view is that the banks are to be regulated and my view is that Washington and the regulators are there to serve the banks.’

But, after the Lost Decade for workers in private sector employment after the Bush tax giveaways to corporations, millionaires and billionaires, corporate after-tax profits are at their highest level since 1947 when such statistics started being kept. Corporations have over $2 trillion in loose cash on hand right now and the amount is only climbing.

If corporations were going to “create jobs,” it appears the last thing they need is another tax break at the expense of the Middle Class and working poor people of America. The gap between the working poorest and wealthiest in America is at its greatest level ever and some 46.3 million Americans are living below the poverty line. It is most important to note that among the groups of Americans slipping into poverty, seniors are notably absent. Anybody ever hear of Medicare and Social Security—soon to be gone if Republicans have their way.

The “job creators” among the millionaires and billionaires aren’t “creating jobs” or the Bush Tax Cuts would’ve led the US into the most booming economic period ever. What America got from the Republicans and the George W. Bush tax cuts was huge debt, the Great Recession and the Lost Decade in America.

Republicans have no new policies to offer except more of the same failed and fatally flawed tax giveaways to corporations, millionaires and billionaires plus gutting Medicare, Medicaid and Social Security to solve our nation’s “debt crisis.” Republicans refuse to even consider that America really faces a jobs crisis.

President Obama realizes there’s a jobs crisis in America, and has made specific proposals to have an immediate impact on job creation and unemployment right now. President Obama proposes to pay for the Jobs Act by reducing and eliminating tax loopholes for corporations and the wealthiest Americans.

Mr. Obama proposes to pay for the Jobs Act in part by getting rid of subsidies to Big Oil that their leaders testified before Congress that Big Oil didn’t need to explore and make new sources of energy available to America.

A stark choice will be put to the Republicans like US House Speaker John Boehner (R-OH); choose between construction jobs rebuilding schools, roads and fixing a critical bridge between Ohio and Kentucky or reducing the depreciation allowances for corporations’ jets.

Republicans like Mitch McConnell (R-KY), US Senate Minority Leader will have to choose between fixing multiple condemned highway bridges directly between Southern Indiana and Ohio and his home state of Kentucky or the favoritism shown billionaire hedge fund managers whose billions in income are taxed at the 15% long term capital gains rate rather than the top marginal rate of 35% or even 28% as ordinary income like the rest of us working for a wage Americans.

Republican leaders like US House Majority Leader Eric Cantor (R-VA) will have to choose between relief and infrastructure repairs for the worst natural disaster to ever hit Richmond, Virginia or the charitable deductions for millionaires and billionaires to be maxed out at 28% rather than the current 35%.

There are no budget cuts proposed to fund the Jobs Act, only the reduction of or elimination of tax breaks for corporations, millionaires and billionaires. Well, my Republican friends, does the Republican Party care about average Americans or “solely and exclusively about its rich contributors?”

Share

Category: Politics

About the Author ()

imothy E. Hogan is a trial attorney, a husband, a father of two awesome children and a practicing Roman Catholic in St. Louis, Missouri. Mr. Hogan has done legal and political work in Jefferson City, Missouri for partisan and non-partisan social change, environmental and consumer protection groups. Mr. Hogan has also worked for consumer advocate Ralph Nader in Washington, DC and the members of the trial bar in the State of New York. Mr. Hogan’s current interests involve remaining a full time solo practitioner pioneer on the frontiers of justice in America, a good husband and a good father to his awesome children.

Comments (3)

Trackback URL | Comments RSS Feed

  1. Mr. Obama’s new stimulus proposals are all well and good, but there is one basic problem no one seems willing or able to discuss. The problem, as most agree, is the lack of jobs. Not just any jobs but middle class jobs. A significant portion of the revenue shortfall is not just because the rich aren’t paying “their fair share”—which would not be enough to make up the gap—but that millions of formerly well-employed Americans are paying no federal taxes as they have no incomes to pay them on.

    The whole idea behind all the tax breaks and incentives for corporations was to spur them to spend the money on job creation, which they have not been doing. At least not here, in America, where it has been very expensive to maintain labor pools at decent levels.

    So here’s the problem: how do you make them spend the money here? There is no law on the books that requires XYZ corporation to spend its tax break here. And if such a law is passed, you can bet there will be a rush to move the body corporate outside the United States.

    Until you solve that fundamental problem,all of this is hair-pulling sturm und drang arm-waving. True, higher taxes are one way to recover that lost revenue and spend it here, but it’s not enough, especially for free-floating multinationals.

    How do we make private enterprise hire American?

  2. Hey, I wrote a multi-part series on Lofgren, too. If you are interested, go to my blog and the final one with links is the second post, Vindication! Must get sleep right now, but I’ll come back and comment later.

Leave a Reply