An Economic System that’s Fundamentally Flawed…Why has labor become so devalued in our modern society compared to capital? It’s badly distorted our entire economic system, contributing to massive & widening wealth gaps. There’s only a finite amount of resources in this era of tepid economic growth & productivity, so the more the gains are concentrated at the very top, the less is made available for the labor class to earn regardless how hard they work. Workers need to have more direct say & a greater vested interest in the organizations they work for. Corporations shouldn’t view them as just cogs in the wheel whose compensation can be minimized to maximize profits. Labor should be considered partners for success instead of treated like old pieces of equipment easily discarded when the bottom line calls for it. The structure of our economic system is inherently flawed in this modern global environment & needs fundamentally revamped.
Even These Famous Rich Moguls Say Their Taxes Should Be Raised
When the spoils from economic growth go to the wealthy, a more progressive tax code only makes sense. Here is the opening to streettalk/buffett-wealthy-americans-undertaxed:
Billionaire investor Warren Buffett said on Monday that wealthy Americans, including himself, are not paying enough taxes. “The wealthy are definitely undertaxed relative to the general population,” Buffett, chairman of Berkshire Hathaway Inc., told CNBC television on Monday. “As we get more specialized, the rich will get richer,” he continued. “The question is: ‘How do you take care of a guy who is a wonderful citizen whose father died in Normandy and just doesn’t have market skills?’ I think the income tax credit is the best way to address that.” “That probably means more taxes for guys like me, and I’m fine with it,” he said.
Bill Gates says much the same thing in this opening to bill-gates-says-rich-people-should-pay-more-taxes:
Do the rich pay their fair share in taxes? Billionaire Bill Gates said on Monday that even though he has paid $10 billion in taxes, he thinks his taxes could and should be higher, especially for capital gains. When a Reddit user asked Gates what he thinks he personally should be paying in taxes, Gates said on a Reddit “ask me anything”session that he thinks the rich should be paying more. Gates wrote: “I think our system can be a lot more progressive (that is richer people paying a higher share). “A key element is making capital gains taxation more like ordinary income (some have suggested making them the same) and having an estate tax more like we had in the past (55% above $3.5M). European countries collect a lot more taxes but through consumption taxes but those are not progressive. “If people want the government to do more it needs to be funded and I see us needing to improve our education and health services. So yes I have paid $10B but I should have had to pay more on my capital gains.”
Potential Ways to Increase Taxes on the Wealthy
The idea of raising taxes on the top earners has gotten popular as Americans realize enormous wage/wealth gaps have materialized in our present-day economic system. Some ideas for fixing the tax code & making it more progressive are in these excerpts from business/dealbook/taxes-wealthy, which the bullet points at the bottom are explained in detail by clicking on the link:
Everyone, it seems, has ideas about new tax strategies, some more realistic than others. The list of tax revolutionaries is long. The short list includes Representative Alexandria Ocasio-Cortez, who wants a top tax rate of 70 percent on incomes above $10 million a year; Senator Elizabeth Warren, who wants a wealth tax; Senator Bernie Sanders, who wants an estate tax with a 77 percent rate for billionaires; and even Senator Marco Rubio, who recently proposed a tax on stock buybacks. Whatever your politics, there is a bipartisan acknowledgment that the tax system is broken. Whether you believe the system should be fixed to generate more revenue or employed as a tool to limit inequality — and let’s be honest for a moment, those ideas are not always consistent — there is a justifiable sense the public doesn’t trust the tax system to be fair.
In truth, how could it when a wealthy person like Jared Kushner, the son-in-law of the president, reportedly paid almost no federal taxes for years? Or when Gary Cohn, the former president of Goldman Sachs who once led President Trump’s National Economic Council, says aloud what most wealthy people already know: “Only morons pay the estate tax.” If you pay taxes, it’s hard not to feel like a patsy. A New York Times poll found that support for higher taxes on the rich cuts across party lines, and Democratic presidential hopefuls are offering plans to do it. But the current occupant of the Oval Office signed a $1.5 trillion tax cut into law, so the political hurdles are high. Over the past month, I’ve consulted with tax accountants, lawyers, executives, political leaders and yes, billionaires, and specific ideas have come up about plugging the gaps in the tax code, without blowing it apart. None of these are as headline-grabbing as Ms. Ocasio-Cortez’s Green New Deal, nor will they evoke the emotional response of a sound bite about Ms. Warren’s wealth tax. But it could be that evolution has a better chance than revolution.
*Patch the estate tax
*Increase capital gains rates for the wealthy
*End the perverse real estate loopholes
*Fix carried interest
*Let’s talk about philanthrophy
*Finally, fund the Internal Revenue Service
Having Children Isn’t Cheap
Especially when young families are so financially strapped to begin with. Way back in the days I was growing up, the benefits from economic growth were far more widely shared, so families typically could live on just the father’s income while moms were freed up to raise the kids. Nowadays, even two jobs is often not enough to cover the bills. We need to fix the economic system so hardworking families can earn a livable wage, which could solve a myriad of problems including raising our current low birth rates. And yes, I do agree the big increase in single-parent households can make things difficult financially & otherwise. In addition to the excerpts below, you can also view charts by clicking on charts-show-soaring-cost-of-having-children-us-2019-2#labor-and-delivery-costs-by-state:
The cost of having children in the US has climbed exponentially since the 1960s. So it’s no wonder the growing crop of Democratic presidential candidates have been proposing ways to address or bring down the costs tied to raising a family. Most recently, Massachusetts Sen. Elizabeth Warren said she wants to provide universal access to child care. According to her proposal, the US would partner with local governments and other organizations to provide various child care options, paying for it with revenue from her wealth tax. Whether or not Warren’s proposal becomes law, the data show a worsening problem. In 2015, American parents spent, on average, US $233,610 on child costs from birth until the age of 17, not including college. This number covers everything from housing and food to child care and transportation costs. This is up 8% from 1990. As a mother myself, as well as a sociologist who studies families, I have experienced firsthand the unexpected costs associated with having a child. And this spike in costs has broad implications, including leading fewer families to have children.
Expenses for a delivery can range from $3,000 to upwards of $37,000 per child for a normal vaginal delivery and from $8,000 to $70,000 if a C-section or special care is needed. These costs are often a result of separate fees charged for each individual treatment. Other factors include hospital ownership, market competitiveness and geographical location. It’s worth noting that these costs often include additional fees for ultrasounds, blood work, or high-risk pregnancies. Child care has become one of the most expensive costs that a family bears. In fact, in many cities, child care can cost more than the average rent. This is particularly challenging for low-income families who often do not make more than minimum wage.
Yes, we must fix our immigration system, but until we do we must stick to the current laws in place. Ironically, our lower birth rates raise the need for immigrants to legally pass through the asylum process & join America’s workforce, as seen in this beginning posted from the article with-low-birth-rate-america-needs-future-migrants:
President Trump, not happy with $1.38 billion for his border wall, has declared a national emergency so that he can use other appropriated funds. However, the real national emergency is not keeping people out with a wall; rather, it is getting the right people to come to America to counter its very low fertility rate of 1.76, which is well below the required population-replacement rate. America’s challenge — if it wants to remain a superpower — is not to build walls and restrict migrant flow excessively, as the Trump administration insists, but rather to manage properly a more generous migrant flow so that its population continues to grow, with all the attendant benefits. In November, the Pew Research Center released data on migration to the United States. The U.S. has more immigrants than any country — about 40 million, making up 13.5 percent of the U.S. population. Among those immigrants, 10.7 million are unauthorized or illegal (23.7 percent of U.S. immigrants). Since 2010, more Asian than Hispanic migrants have arrived each year. Regarding refugees, in fiscal 2017, almost 54,000 were resettled here. The largest number of these immigrants came from the Democratic Republic of the Congo, followed by Iraq, Syria, Somalia and Myanmar. Several factors suggest that migrant flow to U.S. borders will increase in the future. Just beyond Mexico lie the three countries from which highly publicized “caravans” originated in recent months. Stephanie Leutert, writing in Foreign Affairs, indicated that over the past five years, 875,000 migrants from Guatemala, Honduras and El Salvador have come to the U.S. border, driven mainly by gang violence and economic hardship. Until those factors are dealt with, we can expect this flow from Central America to continue.
Horrific Crimes along with Misdirected Emergencies
This makes Trump’s policy of kidnapping terrified migrant kids away from their parents incrementally worse: immigration-unaccompanied-minors-sexual-assault & also migrant-children-abuse-border-family-separations-report. We’ve always called out more lawless nations for their human rights abuses, but now our own country has become a detestable perpetrator. And if our prez wants to declare a national emergency, wouldn’t it make more sense to do it for a real emergency? Such a proposition is presented below in the opening & ending to the article america-urgent-emergencies-border-poverty:
In declaring a national emergency to fund an unnecessary border wall this month, Donald Trump has provoked a conversation about what the word “emergency” actually means. Forget the manufactured border crisis, let’s talk about the real emergencies facing the nation today. Right now in America, there are 140 million people living in poverty or just one paycheck or emergency away from poverty. Thirty-seven million people live without healthcare and 62 million are paid less than a living wage. Fourteen million families cannot afford water and millions are living with poisoned water and without sanitation services. We suffer under an impoverished democracy that has less voting rights today than it did after the 1965 Voting Rights Act was passed.
Instead of focusing on the real emergency of poverty, the president and his enablers have decided to exploit a racist lie that people from Spanish-speaking countries are the greatest threat to this nation. They claim that this is a greater threat than hunger, lack of health care and jobs that pay starvation wages. And the fact is, it’s not just the Republican party that has ignored these issues. Poverty has increased by 60% since the Rev Dr Martin Luther King launched the 1968 Poor People’s Campaign, under both Democratic and Republican administrations. We can no longer accept the same political discourse that for the past 50 years has refused to mention poverty nor can we accept politicians enacting policies that prey on the poor. It’s time to talk about the real emergencies plaguing our nation and the real moral issues of our day – the lack of health care, living wage jobs, clean water and sanitation, the militarization of our communities, the attack on indigenous sovereignty. And it’s time to talk about how we got to this point in the first place. We cannot address systemic racism and poverty unless we acknowledge the fact that voter suppression has distorted our democracy. When extremists are elected through voter suppression and racist gerrymandering, they pass policies that hurt poor black, brown and white people and exacerbate poverty. This is the time to take on the lies of the enablers. When people say poverty is caused by laziness, race, or lack of moral character, we must expose these lies. In today’s America, the real emergency is that a quarter of a million people die from poverty each year while our political system refuses to use the great wealth of this nation to lift the load of poverty.
Other key items that need fixed in our economic system are revealed here. Big Pharma is absolutely gouging the American public: opinion/drug-prices-congress. And we should stop allowing major corporations to hold cities hostage as they play them against each other: cities-america-unite-against-big-corporations.
Watch Out for a Recession
Economists are eyeing the economic conditions here & around the world & don’t have much optimism, as they’re projecting from economic signals a downturn in the next year or two. Those predictions are seen inside recession-likely-2020-half-business-economists-think-so & also found in three-fourths-of-economists-predict-recession-by-2021-survey.
On the issues, Trump knows very little & lacks the intellectual curiosity to learn them. Here we see the former Fed Chair former-fed-chair-janet-yellen-said-trump-doesnt-understand-fed-economy & a current chief trade negotiator trump-china-trade-war-lighthizer-contradicts-president-in-public both indicate our president is essentially clueless.
Don’t Take the Word Socialism at Face Value
Trump & the GOP are using the word socialism ad nauseam as a talking point they’re pinning on the Dems. But there’s a world of difference between the meaning of the word socialism in the traditional sense & the type of democratic socialism the Dems are proposing in their policy agenda: difference-between-socialist-and-democratic-socialist. The GOP will keep barking socialism about the Dems because Republicans really have no ideas or answers on their own side, plus a few years ago even ignored their own advice: the-republican-establishment-has-learned-nothing. As seen in this article from dnc-chair-downplays-gop-use-of-socialism-theyre-wrong-on-the, the Dems at least are generating proposals in trying to tackle real problems & repair a broken economic system burdening so many:
Democratic National Committee (DNC) Chairman Tom Perez on Sunday pushed back against Republicans likening certain Democratic policies to socialism, and compared some hallmarks of President Trump’s time in office to “repressive socialist regimes.” Appearing on “Fox News Sunday,” Perez called the GOP’s use of socialism as an attack line “one of the oldest tricks in the playbook.” He noted Republicans had levied similar criticisms of Social Security, a guaranteed minimum wage and the Affordable Care Act, among other policies. “Why do they do that?” Perez said. “Because they’re wrong on the issues.” Trump has wielded the socialist label in recent weeks as Democrats push progressive ideas such as the “Green New Deal,” and high-profile party members float raising marginal tax rates to 70 percent on the wealthiest Americans. Some prospective Democratic presidential candidates have backed at least one of those ideas, including Sens. Elizabeth Warren (D-Mass.), Kirsten Gillibrand (D-N.Y.), Kamala Harris (D-Calif.) and Bernie Sanders (I-Vt.).
Perez on Sunday called it “ironic” for Trump to criticize others as socialist. “The whole interesting thing about the continued use of the word socialism is that repressive socialist regimes, two of their most frequent qualities are, No. 1, they try to undermine the press. They go after the press,” he said. “And No. 2, they have endemic corruption.” Perez noted that Trump has regularly attacked the press, deploying labels such as “fake news” and “enemy of the people” to describe unfavorable coverage or outlets he dislikes. The DNC leader also said a “culture of corruption” surrounding the Trump administration was a key factor in Democrats’ 2018 midterm victories. Six former Trump associates have been implicated in special counsel Robert Mueller’s investigation into Russian interference in the 2016 election.
Dems Need a Real Plan, Not Just More Government Spending
The Dems more than anything else need an economic message that’s reasonable & reality-based, which can truly resonate with the millions in the working class who’ve fallen through the cracks. See Dem governors express those concerns in excerpts from u-s-democrats-seek-ways-to-counter-trumps-economic-message:
Democratic state governors say their party needs to challenge President Donald Trump’s record on the economy as he seeks re-election next year, by focusing on middle-class Americans who have not seen the benefits of economic growth. Wisconsin Governor Tony Evers, who defeated incumbent Republican Scott Walker in one of the biggest upsets last year, said the unemployment rate in his state did not reflect the struggles faced by voters. “Yes, we have a 3 percent unemployment rate, but we also have 800,000 families that are struggling just to put food on the table. … We have a long way to go,” Evers said in Washington, where he attended a weekend meeting of Democratic and Republican governors from across the country. Minnesota Governor Tim Walz, elected last year in a state that only narrowly voted Democratic in the 2016 presidential election, said voters in his state are concerned about corporate gains not flowing down to workers. “There is no doubt that Minnesotans and Americans are working harder and (are) more productive, but most of that gain has not been seen in the middle class,” Walz said. New Mexico’s governor, Michelle Lujan Grisham, also elected last year, said Democrats needed to counter Trump’s message by talking about how low wages, expensive health insurance and rising costs are squeezing middle-class voters. She said she was concerned about Democrats’ ability to articulate an effective message on the economy and show voters how their own policies encourage investment and well-paid jobs. “I do worry. … If Democrats around the country, including me, are not talking about those precise strategies … I think we won’t get attention for the economic efforts that we’re making,” she said.
Moderation the Wise Move
Rubin points out there is beauty & bounty in moderation. Some progressives are pushing their party to go overboard. Instead, the Dems could score big points by filling that gaping hole in the middle, especially with the GOP base being the ones going way out on the far-right extremes. Those thoughts are seen in excerpts from democratic-voters-arent-where-lot-democratic-candidates-are:
We’ve repeatedly pointed out that, contrary to the conventional wisdom and the rhetoric of many Democratic presidential contenders, the party itself favors moderation. We saw this vividly in 2018 when moderates won primaries and went on to knock out incumbent Republicans, while the forces of Sen. Bernie Sanders (I-Vt.) failed to flip a single House seat from red to blue. And yet the myth of a hyper-progressive party lives on, most likely because some of the more articulate media figures and candidates encourage the perception. And with the right-wing media machine delighted to focus on the most progressive Democrats so as to support the “Socialist!” scream, it is easy to come to the conclusion that moderates are in retreat. That doesn’t make it true.
Now, the definition of what makes a moderate — like the definition of what makes a conservative (anti-constitutional, pro-debt and Russia-friendly, these days) — may change over time. Moderates in today’s Democratic Party are defenders of Obamacare and incremental movement toward universal coverage, something that only a few years ago would have been seen as quite progressive. If you want a party moving to the extremes, take a look at the Republicans. “Nearly six-in-ten Republican and Republican-leaning registered voters (58%) say they want the GOP to move in a more conservative direction, compared with 38% who want it to move in a more moderate direction,” Pew tells us.
More on Moderation
Brooks also sings the praises of moderation as a suggestion for Dems, as opposed to the temptation of going way out on the progressive left. The center is where bipartisan proposals are likely to get done, plus it can attract the swing voters needed to win national elections. A great perspective comes from this last part of the op-ed pulled from opinion/moderate-politics:
We are now leaving the era of Self. The right and left now offer two different magnetic ideas. The Trumpian right offers Tribe. “Our” kind of people are under threat from “their” kind of people. We need to erect walls, build barriers and fight. The earlier American nationalism was about frontier; this is about the fortress. Tribalism is a magnetic idea that has mobilized people from time immemorial. The left offers the idea of Social Justice. The left tells stories of oppression. The story of America is the story of class, racial and gender oppression. The mission now is to rise up and destroy the systems of oppression. This, too, is an electric idea. The problem with today’s left-wing and right-wing ideas is that they are both based on a scarcity mind-set. They are based upon us/them, friend/enemy, politics is war, life is conflict. They are both based on the fantasy that the other half of America can be conquered, and when it disappears we can get everything we want. They are both based on the idea that if we can just concentrate enough power in the centralized authoritarian state, then we can ram through the changes we seek. So a lot of us reject these two ideas. A lot of us don’t want to live in a war society, whether it’s a tribal war or a class war. If the 2020 choice is between Donald Trump and a Democrat who supports the Green New Deal, I’d vote for any moderate alternative.
The problem with moderates has always been that they don’t have a magnetic idea. Recent moderation has been a bland porridge that defines itself by what it doesn’t like. It doesn’t have to be that way. What is the core problem facing America today? It is division: The growing gaps between rich and poor, rural and urban, educated and less educated, black and white, left and right. What big idea counteracts division, fragmentation, alienation? It is found in Leviticus and Matthew: Love your neighbor. Today’s left and right are fueled by anger and seek conflict. The big idea for moderates should be solidarity, fraternity, conversation across difference. A moderate agenda should magnify our affections for one another.
There are four affections that bind our society, and moderates could champion a policy agenda for each: We are bound together by our love of our children. The first mission is to promote policies to make sure children are enmeshed in webs of warm relationships: child tax credits, early childhood education, parental leave, schools that emphasize social and emotional learning. We are bound to society by our work. The second mission is to help people find vocations through which they can serve the community: wage subsidies, apprenticeship tracks, subsidies to help people move to opportunity, work councils, which are clubs that would offer workers lifelong training and representation. We are bound together by our affection for our place. The third mission is to devolve power out of Washington to the local level. Out-radicalize the left and right by offering a different system of power, a system in which power is wielded by neighbors, who know their local context and trust one another. Create a national service program so that young people are paid to serve organizations in their community. We are bound together by our shared humanity. The fourth mission is to embrace an immigration policy that balances welcome with cultural integration. It’s to champion housing and education policies that encourage racial integration. Neither left nor right talks much about racial integration anymore. But it is the prerequisite for national unity.
Moderation is not an ideology; it is a way of being. It stands for humility of the head and ardor in the heart. When you listen to your neighbor, you see how many perspectives there are and you’re intellectually humble in the face of that pluralism. When you listen to your neighbor, you see that deep down we’re the same and you hunger to deepen that connection. Let the left and right stand for endless political war. The moderate seeks the beloved community. That, too, is a magnetic idea.
Democratic Socialism Not Preferable, But Might Be Inevitable If We Don’t Straighten Out The Current Economic System
I’ve repeated over & over & over again the warning if we don’t soon fix capitalism for the typical working American, we’re about to lose it. Emphasizing that point, here is an excellent article/interview with excerpts seen patched together from american-capitalism-neoliberalism-steven-pearlstein:
A decade ago, 80 percent of Americans believed that a free market economy was the best economic system. Today, that number is 60 percent. Another recent poll shows that only 42 percent of millennials support capitalism. So what happened? Why have so many people, both in the US and abroad, lost faith in capitalism? Steven Pearlstein, a columnist for the Washington Post and public affairs professor at George Mason University, has a few answers. The primary reason is that the system has become too unstable: Wages are largely stagnant, and the income gap is so wide that the rich and the poor effectively live in different worlds. No surprise, then, that people are unhappy with the status quo. Pearlstein’s new book, Can American Capitalism Survive?, chronicles the excesses of capitalism and shows how its ethical foundations have been shattered by a radical free market ideology — often referred to as “neoliberalism.” Capitalism isn’t dead, Pearlstein argues, but it has to be saved from itself before it’s too late. I spoke to him about how we might do that, whether capitalism is even worth salvaging at this point, and why he thinks America needs a new social contract between business and society. A lightly edited transcript of our conversation follows.
The most obvious answer is that capitalism has left a lot of people behind in the last 30 years. Everyone can see that the top 1 percent, the top 10 percent, the top 20 percent, have captured most of the benefits of economic growth over the last 30 years, and the rest of the population has been marginalized. Now, we all know this, but I wrote the book because I think there is a feeling even among those of us who didn’t get left behind that this system has become too unfair, too ruthless, and rewards too many of the things we think of as bad. The system offends the moral sensibilities even of people who are benefiting from it. Two things happened during the ’70s and ’80s. First, the American industrial economy lost its competitiveness. Neoliberal policies of global free trade and unregulated markets were embraced, and the US was suddenly facing competition from all over the globe.
So American companies, which had been so dominant in our own market and in foreign markets, started to lose their dominance, and they had to get leaner and meaner. They started behaving in different ways. They started sharing less profits with their employees and with shareholders and customers. Eventually, that produced a revolt from shareholders, and in the mid-’80s we had the first of what were called “hostile takeovers,” in which people would come in and buy up large chunks of companies and threaten to take them over or out the executives if they didn’t put shareholders above all else. The result of all this was that companies changed how they did business and completely embraced the idea that companies should be run to maximize shareholder value and nothing else. Obviously, that meant more money for executives and shareholders and less money for employees and customers. This is the mentality that led us to the place we’re in now.
The question is, is all of that endemic to capitalism? I don’t think so, because we see different kinds of capitalism in countries in, say, Northern Europe and in Germany. Some of that has to do with the rules and laws under which they operate, but a lot of it has to do with the norms of behavior. So capitalism doesn’t have to reach the point of ruthlessness like it has here and other places. And one of the good things about capitalism is that it has self-correcting mechanisms, just as democracy has self-correcting mechanisms. The truth is that the outcome we have now, all of this tremendous inequality, is bad morally and economically. This is not a sustainable system, and if it keeps getting worse, we run the risk of a revolution. So I don’t think capitalism is an inherently moral system or an inherently self-defeating system, but we have to ensure that it adapts when it veers too far into corruption and inequality. And that’s basically what I’m calling for in this book.
As it is now, we’re stuck in a vicious cycle in which concentration of wealth leads to concentration of political power, which leads to yet more concentration of wealth. And we know how this plays out in the long run — it leads to revolution. But we don’t have to get anywhere near that if we can make the changes we need to make now. I agree that the GOP tax cut was enormously irresponsible and unfair. These are the sorts of things that can cause the public to say, “Enough is enough.” My view is that we’re at a tipping point now and things are about to change. You and I may disagree about what, exactly, we need to do, or how far we need to go, but I think there are enough positive signs in public opinion that suggest we’re at a tipping point. We’ll just have to see what happens next.
Somebody Done Somebody Wrong
There are many tentacles to this song. Our economic system continues to do wrong by the working American middle class. Trump is now in another summit with North Korea’s murderous dictator, which Jong Un uses to elevate his status in the eyes of the world & his own people. But chances are good he’s just stringing Trump along again, as Jong Un Done Trump Wrong, since he likely has no intentions of giving up his nukes. Trump not long ago said Jong Un & him “fell in love” at the Singapore summit, but our prez is probably going to become a jilted lover. The other big headline story is the Cohen congressional testimonies this week, with their many years together as Trump & Cohen engaged in a regular pattern of shady deals, threats & corruption like a mob family, which now they’ve become enemies in a high-stakes battle played out on the world stage. So they’ve turned on each other, giving them both a reason to sing a Somebody Done Somebody Wrong Song: