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Thread: A non partisan thread....economic populism

  1. #1
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    A non partisan thread....economic populism

    This article is written by a highly partisan guy, the scretary of labor under Bill Clinton. You may hate/love or be indifferent to his political party, but what about the theories in this commentary?

    And is it possible to discuss them without partisan and/or "left wing vs right wing" bashing?

    I ask because I know we lose the potential for creating either compromises or new ideas by being as polarized as this country, and this message board, is.


    Anyway, an except and then the link....

    An Introduction to Economic Populism

    Robert B. Reich

    It came down to two simple questions. Suppose a proposed policy will increase the incomes of some people without decreasing the incomes of any others. Should it be implemented? Bob (Rubin) and I agreed it should. But suppose the people whose incomes will rise are already wealthier than everyone else. Although no one will lose ground, inequality will widen. Should it still be implemented? I won’t tell you where he and I came out on that second question. But we agreed that people who don’t share in such gains feel relatively poorer. Widening inequality also further tips the balance of political power in favor of the wealthy.

    That conversation (with Rubin)occurred a decade ago. Inequality is far more worrisome now. The incomes of the bottom 90 percent of Americans have increased about 2 percent in real terms since then, while that of the top 1 percent has increased over fifty percent.

    Yet the philosophical debate is coming up all the time these days, and it helps explain the new economic populism. Consider, for example, the Bush cuts. They’ve mainly benefitted the top fifth of taxpayers. Supply-siders argue the cuts have generated enough extra revenues to pay for themselves so they haven’t enlarged the budget deficit. That’s debatable but let’s make the heroic assumption the supply-siders are correct and no one has been made worse off. Yet even so, most Americans have not benefitted – nothing has trickled down. Real median wages have barely budged since they were enacted. So the underlying question is whether they’re justified by the fact that rich Americans have gained from them while no one has lost ground. The answer is no. They’ve widened inequality.

    Or consider trade-opening agreements. They give Americans access to more low-cost products and services from abroad. This makes Americans’ dollars go further. But the agreements especially benefit the rich, who spend more than the middle class and the poor because they have more income to spend. The agreements also typically impose a burden on working-class Americans who thereby lose their jobs to foreigners. These job losers get new jobs, but studies show the new jobs pay 10 to 15 percent less than the old ones. Even if you assume that access to cheaper goods from abroad adds about 10 to 15 percent to their purchasing power, these working-class wage earners come out about even, at best. That means the overall result of most trade agreements is to widen inequality. Do the efficiency benefits of trade outweigh this result? Maybe a decade ago when inequality was less pronounced. Probably not, now.

    http://www.robertreich.org/reich/20061222.asp

  2. #2
    Member Linda_D's Avatar
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    I think that economic populism may be the big issue in the next decade or two because there are rumblings on both the left (liberals like Reich) and from the right (conservatives like Buchanan). We've seen some of that on these boards as well from both sides.

    A lot of people feel they are NOT better off than they were a decade or two ago. They don't like the idea of everything seemingly made in China. They don't like seeing jobs shipped overseas. I think when the bills for the Iraq war come due (and they will in the next few years), there will be strong demands for many of the Bush tax cuts that benefited the top 10-20% of taxpayers be eliminated.

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    Member Eat My Gun's Avatar
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    How about a flat tax? Everyone pays porportionately the exact same amount. No inequity there. So why doesn't it happen?

    Then there's another excellent proposal to do away with the income tax all together, and institute a national sales tax. All the wealthy folks who buy so many cheap goods made in China and therefore reap a disproportionate benefit from their low cost would also pay more in taxes. Another plus is that all illegal immigrants, people who work off the books, and those on public assistance would actually be brought into the fold as taxpayers.


    "I won't live by rules that make no sense to me." - Evan Tanner 1971-2008

    Transfixus sed non Mortuus

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    yes, I support the national sales tax replacement of income tax

    yes, I support the national sales tax replacement of income tax

    but all this is beside the point....a national sales tax is the only way to tax imports equally with US made goods and services.

    and one would still have to report their income...because the national sales tax would only eliminate "x" tax brackets....yes Bill Gates would still have an income tax....but the GM worker or M&T worker making 30-50k would most likely be exempt from income tax.

    but whether your opposed or supportive...democrat or republican...it doesnt matter...we are so indebted to foreign nations that we are selling our highways and water sytems....its only a matter of time before the US dollar crashes.....our debt becomes worthless...etc

    I dont think anyone looks forward to that day...BUT....there is one thing to look forward too....and that is....a dollar crash will most likely kick all those rockefellar globalists out of government policy positions...and be replaced by patriotic america firsters.

    I doubt americans will have much receptiveness to selling highways our outsourcing jobs or immigration when the dollar crashes. How nice it will be for the likes of Tom Freidman finally shut up and fade away!

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    A national sales tax makes a lot of sense to me. It doesn't penalize people for working hard to earn a living, send their kids to college etc. And, as one of the posters (Timmy? Sorry. My brain is mush when I haven't slept, like to tonight) points out, it does bring everyone into the fold, including illegal immigrants.

    I also like it because it would make us think-twice consumers. We're pretty rapacious right now. At least I am, and I don't think I'm any different than most people.

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    the point is foreign goods dont pay property taxes

    the point is foreign goods dont pay property taxes, they dont pay US payroll taxes, they dont pay taxes that support our military or our highway or our medicare for seniors or our veterans etc.

    here is an example....suppose a national sales tax replaced all labor taxes like FICA and paid the corporate share and employee share of health/dental as well as replacing income taxes.

    imagine how much more reasonable the cost of labor in the US would be with the rest of the world.

    Its not brain science...this is what Europe does with imported goods, this is what Canada, Japan, China ... this is the tax policy for every export oriented country in the world (tax imports ... lower the cost of exports and domestic labor)......

    americans arent uncompetitive because we are lazy...americans are uncompetitive because our taxation, currency, foreign and domestic policy are all aimed to benefit foreign nations (used as negotiating tools in foreign policy...so that we can be the policeman for the world)

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    Member Linda_D's Avatar
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    A national sales is the most regressive tax there is because it would impact the people at the bottom the hardest. It's hardly "economic populism" -- ie, making most people better off. In order to eliminate the income tax, a national sales tax would have to be 25-30% on everything -- food, medicine, clothing, cars, houses, all kinds of services.

    It would be a disaster for the US economy which is consumer based because it would essentially raise the prices on everything by the amount of the tax. The more categories of things that were exempted (let's say food and medicine), the higher the tax on remaining goods and services would have to be.

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    Member dtwarren's Avatar
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    I agree with Linda. I believe we need to move away from these regressive taxes and move more towards smaller government funded by more proportional taxes.
    “We in America do not have government by the majority. We have government by the majority who participate.” ― Thomas Jefferson

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