How Democrats Can Become Relevant Again (And Rescue the Nation While They’re At It)<...>
Democrats have become irrelevant. If they want to be relevant again they have to connect the dots: The explosion of income and wealth among America’s super-rich, the dramatic drop in their tax rates, the consequential devastating budget squeezes in Washington and in state capitals, and the slashing of public services for the middle class and the poor.
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The bottom 90 percent of Americans now earn, on average, only about $280 more per year than they did thirty years ago. That’s less than a 1 percent gain over more than a third of a century. Families are doing somewhat better but that’s only because so many families now have to rely on two incomes.
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Meanwhile, estate taxes (which hit only the top 2 percent) have been slashed, as have taxes on capital gains – which comprise most of the income of the super rich. In the late 1970s, capital gains were taxed at well over 35 percent. Under Bill Clinton, the capital gains rate was 20 percent. Now it’s 15 percent.
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Here’s what Democrats should be saying:
Hike taxes on the super-rich. Reform the tax code to create more brackets at the top with higher rates for millionaires and billionaires. Absurdly, the top bracket is now set at $375,000 with a tax rate of 35 percent; the second-highest bracket, at 33 percent, starts at $172,000 for individuals. But the big money is way higher.
moreReich's suggestions are good, but Clinton was in office for eight years and income for 90 perecent of American still rose less than 1 percent in that 30-year period. Something drastic needs to be done.
As for the debate to keep the government funded, Democrats should tell the Republicans to go to hell on the cuts. The government will shut down, but that will be on them.
Also, pushing Reich's suggested changes doesn't mean House Republicans will jump on board. In fact, his suggestions and more are already in the President's budget.
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The president, in a $3.7 trillion budget plan released yesterday in Washington, revived dozens of proposals that Congress has rejected, including
$129 billion in higher taxes on the overseas profits of U.S. companies. He also proposed changing the
tax treatment of oil, gas and coal companies, which would raise about $46 billion.
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The proposal also would
bring back pre-2001 tax rates on income and capital gains for individuals earning more than $200,000 annually and married couples making more than $250,000. The
estate tax would return to 2009 levels with a $3.5 million per-person exemption and a 45 percent top rate. Under a law Obama signed in December, lower rates expire at the end of 2012.
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The budget plan would
limit itemized deductions for top earners to 28 percent, curbing the value of tax breaks for charitable contributions, home mortgage interest and state and local taxes. That proposal has been included in every budget of Obama’s presidency and was rejected as a revenue-raising provision to fund his overhaul of the health system last year.
linkAlso included is a
$30 billion tax on the largest financial institutions.
If Reich or anyone knows how to get the Republicans on board with this, they need to share their strategy with Congressional Dems and the WH.
If Democrats do these things, they could, as Reich said, "rescue the nation" (from a Republican assault).
Get it done!