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The tragedy of how the richer made us poorer

Why do you think John Boehner and Mitch McConnell are so intent on renewing the Bush tax cuts for the richest 2 percent of Americans when they know it will bust another $700 billion hole in our national treasury over 10 years and prove their hypocrisy on fiscal responsibility?

It's because cutting taxes for the richest Americans is the GOP's No. 1 job. Nothing else comes close to being that important, despite the campaign rhetoric of these leading Republicans. Not reducing the deficit, not supporting the troops, not cutting taxes for the middle class, not outlawing abortion, not even, dare I say it, protecting gun rights. Boehner and McConnell are the four-star mercenary generals in a war launched by America's corporate interests and superrich. This is what they were hired to do.

A new, amazing book explains. In Winner-Take-All Politics, How Washington Made the Rich Richer — And Turned Its Back on the Middle Class, political scientists Jacob Hacker of Yale and Paul Pierson of the University of California, Berkeley, detail the operational battle plan that the superrich have been implementing for the last 30 years. With piles of cash, they've built an army of beholden politicians, Republicans as well as Democrats, and an array of conservative think tanks such as the Heritage Foundation and the American Enterprise Institute to seed ideas and feed the public their arguments.

The agenda is simple: reduce taxes for the superrich while watering down or defeating regulation that might make the economy operate more fairly. This involves methodically stripping labor and the middle class of its political power.

You didn't know you were in a war? Well, look at your war wounds. We have gone from the 1960s, when most of the nation's income gains were shared by the bottom 90 percent of households, to today's world in which more than half those gains are directed to the richest 1 percent. Those at the tippy-top, the richest 0.01 percent, saw their average aftertax annual income more than quintuple between 1979 and 2005 from just over $4 million to nearly $24.3 million (in inflation adjusted dollars).

Florida's Gov.-elect Rick Scott, a man worth hundreds of millions of dollars, brought in $7.87 million in 2009 and paid federal taxes of just 13 percent — a lower rate than many bus drivers and teachers. That doesn't happen by accident.

For the rest of us, the picture is one of working much harder to inch ahead. Without women entering the work force, middle-income households would have seen almost no gains between 1979 and 2000. And even during a period of economic growth from 2001 to 2007, the median income of non-elderly households actually fell.

Hacker and Pierson demonstrate that the American government facilitated this, not globalization, advancing technology or a lack of worker education. Europe and Canada experienced these same challenges but didn't see an American-style spike in unequal income distribution.

Today, workers in other Western democracies work fewer hours while enjoying guarantees of generous vacation time, health care and pensions. That's the kind of financial security and work/life balance shared prosperity is supposed to buy average people. In the United States, we gave that up. Or to be more precise, our political leaders gave it up on our behalf.

A key part of the superrich's strategy was the destruction of the labor movement. Without this strong champion for the economic interests of the middle class in the halls of Congress, politicians were hearing from just one group: highly organized and monied interests who also happened to be bankrolling their campaigns.

Just to give us an idea of how outgunned lobbyists for the middle class have become, Hacker and Pierson note that when the 2001 Bush tax cuts were being debated — cuts under which taxpayers in the bottom 80 percent would receive breaks amounting to little more than $600 annually while the richest 1 percent would receive a whopping $38,000 — the AFL-CIO had only one lobbyist working quarter-time to fight this. The other side literally had swarms of lobbyists in its corner.

The book's most tragic element is how so many Democrats, looking for some way to stay competitive in the race for campaign cash, have been co-opted or neutralized by the superrich. The go-to party for America's plutocrats is still the Republican Party, but the Democrats are no longer the full-throated opposition that we the people desperately need.

The tragedy of how the richer made us poorer 11/20/10 [Last modified: Saturday, November 20, 2010 3:30am]
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