Democrats are trapped in a tax architecture George W. Bush built in 2001. Now we're at war with Iran, a country he named to the Axis of Evil in 2002. He won.
Won ? Hastert in prison; Bush retired in anonymity, humiliated by the failure of his wars, defeated by his wicked denial of climate change, forever to be known as the second worst President; the names of McConnell and Grassley disgraced; the grifter Frist tricked even by Liz Holmes.
A Bush network of sleeper cells lies in wait—Nicolle Wallace, Schmidt, Murphy, Stevens, Mehlman, Senor (and his wife), the daughter in TV, George P. thinking he’ll get his shot one day, Condi keeping the flame burning at Hoover.
This is so important. People understand insurance and value the peace of mind it brings, but structuring it as insurance also leads to other beneficial policies, because insurance is about managing risk, as well as sharing in the pool of funds that insurance contributions create. You can present policies like vaccinations, or physical fitness programs as ways to manage risk that help to make the program sustainable. Retraining programs, early childhood education investments, college and university all work to make it less likely that people will need to draw on unemployment insurance. It creates all these virtuous circles and because they pay into it they want it to be there for them, and will more readily participate in things that make it sustainable. It is inclusive because you are sharing risks, and yes it promotes solidarity.
Reading about Hillary's plan to fund family leave by taxing the wealthy reminded me of WaPo article documenting the umpteen trillion dollars of programs Trump said he could fund via his tariffs. Both Dems thinking they can get more golden eggs from the fat goose and the GOP thinking that taxes are always an outrage need to abandon magical thinking and do the hard work of persuading Americans that our government - and the services/benefits it provides - is worth paying for. Gift link to WaPo article: https://wapo.st/4uIgC1E
Thank you for writing this! Van Hollen, Booker, and Porter have lost the plot. I won’t vote for any D in the primary who makes a similar tax-cut pledge. I pray I’ll have someone to vote for in the general who hasn’t.
No mention of the Sander's wealth tax which funds 8 different causes? I take it you don't like it for the reasons laid out and dodging commentary altogether. I like what it raises, sums and most of the goals, but it will face legal uncertainty. No reason it couldn't be combined with a tax on financial transactions, and a federal minimum "symbolic tax of citizenship" which might be $25 per year up to 35,000 earners, 50 per year for up to 75,000, and 100 and 250 as we get into the sacred, holy terrain of the middle class, and the highest form of life on earth, after the billionaires, the "upper middle class." The untouchables according to your dialogue. Another way to work my idea, which I think you share in symbols of democracy at least, is to call it wealth tax, a consistent category to the 5% tax on the literal billionaires; that might include many from the lower middle class who have no net worth at all if they don't own a home or are still paying on a car...but might aid the legal struggles...thus it would be like a "graduated" wealth tax...
I think you raise important issues about where even Dems have drifted on tax policy; it does cripple, right out of the gate, not only serious programs but the whole sense of social solidarity, which is an huge obstacle in a society which sees an increasing division of labor every decade, a solidarity and communication barrier in it own right, to add to religious and ethnic diversity and ancient regional differences between rural and urban, with surburban an increasingly important category. And all the while, demogogues fanning the flames or the rife divisions, risking complete fracture as they try to build a viable coalition at what's left of the voting mechanism.
I see the low-tax liberalism as a rational political response to the reality that most voters have incomes too high to receive benefits from income support programs other than Medicare and Social Security. 73% of 2024 voters earned 50,000 or more in income*, which is usually far above the income cutoff for most of these programs. Some don't want the government to spend on such programs at all, others are fine with redistribution from "rich" to "poor" provided they aren't included in the "rich" category. These voters would benefit from paid leave, but if asked to pay more for it, might ask what the point is. They tend to have children within marriage, the women don't feel like they've been left out in the lurch and are receiving no support from men. If it's sold explicitly as a way to support single-mothers, that probably won't prove a winning message either.
The proponents of low-tax liberalism realize, too, that the Democrats' hold on college educated whites isn't as secure as some people think. Trump still won 45% of them, and some of them would be entirely willing to defect back to the Republicans if the Democrats talk about raising their taxes, particularly if Trump is succeeded by a more serious, suit-and-tie Republican.
“Social insurance is insurance against lost wages. Payroll taxes are part of the mechanism through which workers contribute to insure themselves against unemployment”
Excellent post. The first priority, of course, is saving (and improving) democracy. But, other priorities can help in this, or might be achieved at low enough cost in political capital that they are still worth pursuing. That said, some suggestions for fixing these problems.
A possibly good approach is to make the tax increase secondary to the benefit. For example, really push the benefit of lowering the Medicare age to 50 and covering all children and students. Then say this will be entirely funded with enormous tax hikes on billionaires and the rich, with modest tax hikes on the merely wealthy, with no increase for any couple with income under $250K, and stress that the decrease in healthcare costs will mean a net gain for all, but the very rich.
I agree with your point that this, "I paid for my Social Security" attitude helps make it untouchable, but I think it would be quite untouchable otherwise -- the biggest thing is, try-and-see is the key! People have seen firsthand how crucially important Social Security and Medicare are, and how the Republican lies about them are untrue. And, if the cost for lowering the Medicare age to 50 and covering all children and students is entirely borne by progressivity, the non-rich will still be paying their same old payroll taxes, and still think I paid for this (they do now, when they have paid in less than they are getting out.) You could at the same time add dental and appliances to Medicare -- and a raft of efficient cost cutting measures to the healthcare system.
Other good programs you could push -- touting the benefits, paid for with tax increases on the wealthy -- are universal free preschool and universal free college and trade school (well regulated).
Finally, the best thing we can do long term (other than safeguarding democracy) is to increase massively spending on basic scientific and medical research. We spend so astonishingly little on this, given the incredible return and lack of positional externalities, about 1/300th of GDP, that we could easily double this just with tax increases on billionaires. I would increase it tenfold without a second thought, and really far more.
Won ? Hastert in prison; Bush retired in anonymity, humiliated by the failure of his wars, defeated by his wicked denial of climate change, forever to be known as the second worst President; the names of McConnell and Grassley disgraced; the grifter Frist tricked even by Liz Holmes.
Fair, and certainly his brother didn't win and the family and its network expunged out of the party.
A Bush network of sleeper cells lies in wait—Nicolle Wallace, Schmidt, Murphy, Stevens, Mehlman, Senor (and his wife), the daughter in TV, George P. thinking he’ll get his shot one day, Condi keeping the flame burning at Hoover.
Your point on the tax trap is well made. Thanks. Kind of a despairing situation we’re all in.
This is so important. People understand insurance and value the peace of mind it brings, but structuring it as insurance also leads to other beneficial policies, because insurance is about managing risk, as well as sharing in the pool of funds that insurance contributions create. You can present policies like vaccinations, or physical fitness programs as ways to manage risk that help to make the program sustainable. Retraining programs, early childhood education investments, college and university all work to make it less likely that people will need to draw on unemployment insurance. It creates all these virtuous circles and because they pay into it they want it to be there for them, and will more readily participate in things that make it sustainable. It is inclusive because you are sharing risks, and yes it promotes solidarity.
Chilling video.
Reading about Hillary's plan to fund family leave by taxing the wealthy reminded me of WaPo article documenting the umpteen trillion dollars of programs Trump said he could fund via his tariffs. Both Dems thinking they can get more golden eggs from the fat goose and the GOP thinking that taxes are always an outrage need to abandon magical thinking and do the hard work of persuading Americans that our government - and the services/benefits it provides - is worth paying for. Gift link to WaPo article: https://wapo.st/4uIgC1E
Thank you for writing this! Van Hollen, Booker, and Porter have lost the plot. I won’t vote for any D in the primary who makes a similar tax-cut pledge. I pray I’ll have someone to vote for in the general who hasn’t.
No mention of the Sander's wealth tax which funds 8 different causes? I take it you don't like it for the reasons laid out and dodging commentary altogether. I like what it raises, sums and most of the goals, but it will face legal uncertainty. No reason it couldn't be combined with a tax on financial transactions, and a federal minimum "symbolic tax of citizenship" which might be $25 per year up to 35,000 earners, 50 per year for up to 75,000, and 100 and 250 as we get into the sacred, holy terrain of the middle class, and the highest form of life on earth, after the billionaires, the "upper middle class." The untouchables according to your dialogue. Another way to work my idea, which I think you share in symbols of democracy at least, is to call it wealth tax, a consistent category to the 5% tax on the literal billionaires; that might include many from the lower middle class who have no net worth at all if they don't own a home or are still paying on a car...but might aid the legal struggles...thus it would be like a "graduated" wealth tax...
I think you raise important issues about where even Dems have drifted on tax policy; it does cripple, right out of the gate, not only serious programs but the whole sense of social solidarity, which is an huge obstacle in a society which sees an increasing division of labor every decade, a solidarity and communication barrier in it own right, to add to religious and ethnic diversity and ancient regional differences between rural and urban, with surburban an increasingly important category. And all the while, demogogues fanning the flames or the rife divisions, risking complete fracture as they try to build a viable coalition at what's left of the voting mechanism.
I see the low-tax liberalism as a rational political response to the reality that most voters have incomes too high to receive benefits from income support programs other than Medicare and Social Security. 73% of 2024 voters earned 50,000 or more in income*, which is usually far above the income cutoff for most of these programs. Some don't want the government to spend on such programs at all, others are fine with redistribution from "rich" to "poor" provided they aren't included in the "rich" category. These voters would benefit from paid leave, but if asked to pay more for it, might ask what the point is. They tend to have children within marriage, the women don't feel like they've been left out in the lurch and are receiving no support from men. If it's sold explicitly as a way to support single-mothers, that probably won't prove a winning message either.
The proponents of low-tax liberalism realize, too, that the Democrats' hold on college educated whites isn't as secure as some people think. Trump still won 45% of them, and some of them would be entirely willing to defect back to the Republicans if the Democrats talk about raising their taxes, particularly if Trump is succeeded by a more serious, suit-and-tie Republican.
*Source: https://www.cnn.com/election/2024/exit-polls/national-results/general/president/0
“Social insurance is insurance against lost wages. Payroll taxes are part of the mechanism through which workers contribute to insure themselves against unemployment”
I wish 🥲
Mike,
Excellent post. The first priority, of course, is saving (and improving) democracy. But, other priorities can help in this, or might be achieved at low enough cost in political capital that they are still worth pursuing. That said, some suggestions for fixing these problems.
A possibly good approach is to make the tax increase secondary to the benefit. For example, really push the benefit of lowering the Medicare age to 50 and covering all children and students. Then say this will be entirely funded with enormous tax hikes on billionaires and the rich, with modest tax hikes on the merely wealthy, with no increase for any couple with income under $250K, and stress that the decrease in healthcare costs will mean a net gain for all, but the very rich.
I agree with your point that this, "I paid for my Social Security" attitude helps make it untouchable, but I think it would be quite untouchable otherwise -- the biggest thing is, try-and-see is the key! People have seen firsthand how crucially important Social Security and Medicare are, and how the Republican lies about them are untrue. And, if the cost for lowering the Medicare age to 50 and covering all children and students is entirely borne by progressivity, the non-rich will still be paying their same old payroll taxes, and still think I paid for this (they do now, when they have paid in less than they are getting out.) You could at the same time add dental and appliances to Medicare -- and a raft of efficient cost cutting measures to the healthcare system.
Other good programs you could push -- touting the benefits, paid for with tax increases on the wealthy -- are universal free preschool and universal free college and trade school (well regulated).
Finally, the best thing we can do long term (other than safeguarding democracy) is to increase massively spending on basic scientific and medical research. We spend so astonishingly little on this, given the incredible return and lack of positional externalities, about 1/300th of GDP, that we could easily double this just with tax increases on billionaires. I would increase it tenfold without a second thought, and really far more.