Robert Reich
Vice President Joe Biden, accompanied by his wife Dr. Jill Biden, gives a 'thumbs-up' as they board Air Force Two at Lexington Blue Grass Airport, Friday, Oct. 12, 2012, in Lexington, Ky. (Pablo Martinez Monsivais/AP)
Why Biden won
I thought Biden won Thursday night’s debate because he came off as genuine, passionate, and brimming with conviction. Ryan, by contrast, seemed like a wooden marionette, a kid out of his depth relative to someone who not only knew the facts but lived them.
On taxes, Ryan couldn’t come up with any details about what loopholes he and Romney would close, or how their magic arithmetic (giant tax cut for the wealthy plus $2 trillion more for the military than the Joint Chiefs of Staff want) can possibly be paid for without socking it to the middle class.
By contrast, Biden made the case for average working people whose wages have barely risen in thirty years but who are bearing a higher total tax burden (payroll, sales, property, income) on a higher percent of their income than high rollers like Romney — and why the well off should do more.
On Medicare, Ryan couldn’t explain why his plan wasn’t a voucher program that “saved” money only by shifting the costs on to seniors who would end up holding the bag as medical costs rose. Biden effectively defended the President’s plan to save Medicare by cutting excessive payments to providers.
Biden also pointed out that Ryan and his allies had tried to privatize Social Security. Score another one for Joe.
On abortion, Ryan had to admit he and Romney would work to prevent women from having the right to choose an abortion if they needed and wanted one. Biden made it clear his religious beliefs about when life began should not, in his view, force anyone who didn’t share them to follow them.
I thought Biden’s closing could have been tougher, drawing a sharper contrast between the Romney-Ryan “you’re on your own” worldview, and the “we’re in it all together” belief that has built America — and which Obama and Biden represent.
But overall it was Biden’s night. He not only trounced Ryan, but also, in the process, trounced Romney. Joe Biden is an average Joe solidly grounded in America’s working middle class — nothing pretentious or devious about him — in contrast to the plutocrat who heads the Republican ticket, and the billionaires who are backing him.
Senate Finance Committee members meet privately with Federal Reserve Chairman Ben Bernanke on the looming economic crisis, often called the "fiscal cliff", on Capitol Hill in Washington, in this September 2012 file photo. (J. Scott Applewhite/AP/File )
How the fiscal cliff turns into a gentle 'fiscal hill'
These are awkward days for deficit hawks who believe the American economy can get back to health only if the nation gets its fiscal house in order. If they get their wish, the economy goes over a cliff.
Regardless of what happens Election Day, at the beginning of next year more than $600 billion in tax increases and spending cuts automatically go into effect. That’s equivalent to about 5 percent of the entire U.S. economy, more than the projected growth of the whole gross domestic product next year.
The problem is, if we fall off this fiscal cliff we plunge into recession. That’s because the cliff withdraws too much demand from the economy too quickly, at a time when unemployment is still likely to be high.
The Congressional Budget Office projects real economic growth will drop at an annual rate of 2.9 percent in the first half of 2013, and unemployment will rise to 9.1 percent by the end of next year.
As Spain and Great Britain have demonstrated, launching fiscal austerity at a time when a nation’s economic capacity is substantially underutilized causes the economy to contract. This makes the debt even larger in proportion to the size of the economy. Rather than reassure global lenders and investors, it spooks them more.
America is about to fall off the fiscal cliff because Democrats and Republicans in Congress haven’t been able to agree on a plan for long-term deficit reduction – and this failure will trigger automatic spending cuts in January. Meanwhile, the temporary tax cuts enacted by former President George W. Bush in 2001 and 2003, and extended for two years by President Obama, will run out December 31st, as will the President’s temporary jobs measures – a payroll-tax holiday and extended unemployment benefits.
In a rational world, deficit reduction on this scale wouldn’t happen until the economy is once again healthy – when unemployment has dropped to below 6 percent and economic growth is back to at least 3 percent. These would be sensible triggers.
But hyper-polarized Washington hasn’t shown itself capable of rational behavior. Democrats and Republicans have been so much at each others’ throats that whenever one side senses the other wants (or fears) something more, the party that doesn’t want or fear it as much has a bargaining advantage in an ongoing game of chicken.
This is why the nation is heading over the cliff – or, more accurately, appears to be heading that way. Congressional Democrats have concluded Republicans are more afraid than they are of going over it because the pending tax increases will fall most heavily on America’s wealthy, and half the spending cuts would come out of the defense budget. (Republicans, you may have noticed, are particularly solicitous of the wealthy and of defense contractors.)
So most Democrats have decided to wait it out in order to maximize their bargaining power in negotiations over how to reduce the long-term deficit. They want a deal that raises taxes only on America’s wealthy and doesn’t substantially alter Medicare, and Social Security — which is the opposite of what Republicans want.
Democrats also reason that, once the Bush tax cut has been terminated, Republicans won’t be able to resist an offer to reduce taxes on the middle class (those earning $250,000 or less). After all, Republicans have pledged to vote for any and all tax cuts. Once Democrats get the best deal they can, they’ll make it retroactive to January 1.
As a practical matter, then, negotiations over America’s budget deficit will drag on into the new year, right over and beyond the fiscal cliff. A deal might not be struck until February, or even March.
But because everyone will know that the final compromise won’t be nearly as draconian – and is going to be retroactive to the start of the year — the cliff won’t feel like much of a cliff. In actual effect it will be more like a hill whose slope remains uncertain but will almost surely be gradual.
With any luck, by the time significant tax increases and spending cuts take permanent effect, unemployment will already have dropped and growth accelerated. In other words, the irrational and irascible American political process may come up with a timetable for reducing the budget deficit that’s surprisingly sensible.
In these September 2012 file photos, President Barack Obama and Republican presidential candidate Mitt Romney both campaign in the battleground state of Ohio. Many Democrats and Republicans are motivated to vote in this election out of fear of the opponent, Reich writes. (AP Photos)
Fear and voting in America
The latest Pew Research Center poll shows Mitt Romney ahead of President Barack Obama among likely voters, 49% to 45%. But the latest Gallup poll shows the President Obama leading Romney among likely voters, 50% to 45%.
What gives? The Pew poll covered the days immediately following last Wednesday’s presidential debate. It didn’t include last weekend. The Gallup poll, by contrast, included the weekend — after September’s jobs report showed unemployment down to 7.8 percent for the first time in more than three years.
So it’s fair to conclude the bump the President received from the jobs report bump made up for the bump Romney got from the debate. No surprise that voters care more about jobs than they do about debate performance.
But don’t be misled. The race has tightened up.
Moreover, polls of “likely voters” are notoriously imprecise because they reflect everyone who says they’re likely to vote – including those who hope to but won’t, as well as those who won’t but don’t want to admit it.
Remember: The biggest party in America is neither Democrats nor Republicans. It’s the party of non-voters — a group that outnumbers the other two.
So the real question is which set of potential supporters is more motivated on Election Day (or via absentee ballot) to bother to vote.
The biggest motivator in this election isn’t enthusiasm about either of the candidates. The Republican base has never particularly liked Romney, and many Democrats have been disappointed in Obama.
The biggest motivator is fear of the other guy.
There’s clear reason for Democrats and Independents to fear Romney and Ryan — their reverse Robin-Hood budgets that take from the poor and middle class and reward the rich; their determination to do away with Medicare and Medicare, as well as Dodd-Frank constraints on Wall Street, and ObamaCare; their opposition to abortion even after rape or incest, and rejection of equal marriage rights; their support for “profiling” immigrants; and their disdain of the “47 percent,” to name a few.
And the thought of the next Supreme Court justices being picked by someone who thinks corporations are people should strike horror in the mind of any thinking American.
Yet Romney is such a chameleon that in last Wednesday’s debate he appeared to disavow everything he’s stood for, hide many of his former positions, and even sound somewhat moderate.
Meanwhile, for four years the GOP and its auxiliaries in Fox News and yell radio have told terrible lies about our president – charging he wasn’t born in America, he’s a socialist, he doesn’t share American values. They’ve disdained and disrespected President Obama in ways no modern president has had to endure.
They’re drummed up fear in a public battered by an economic crisis Republicans largely created, while hiding George W. Bush so we won’t be reminded. And they’ve channeled that fear toward President Obama and even to the central institutions of our democracy, casting his administration and our government as the enemy.
They’ve apparently convinced almost half of America of their lies – including many who would suffer most under Romney and Ryan.
Republicans are well practiced in the politics of fear and the logistics the big lie. The challenge for Obama and Biden and for the rest of us over the next four weeks is to counter their fearsome lies with the truth.
President Barack Obama speaks during a campaign rally in Fairfax, Va., Friday. Despite good numbers for September, the economy is still crawling out of the deep crater it fell into in 2008 and 2009, Reich writes. (Kevin Lamarque/Reuters)
Jobs report: Obama's sigh of relief
The White House is breathing easier this morning. The Bureau of Labor Statistics reports the unemployment rate dropped to 7.8 percent – the first time it’s been under 8 percent in 43 months.
In political terms, headlines are everything – and most major media are leading with the drop in the unemployment rate.
Look more closely, though, and the picture is murkier. According to the separate payroll survey undertaken by the BLS, just 114,000 new jobs were added in September. At least 125,000 are needed per month just to keep up with population growth. Yet August’s job number was revised upward to 142,000, and July’s to 181,000.
In other words, we’re still crawling out of the deep crater we fell into in 2008 and 2009. The percent of the working-age population now working or actively looking for work is higher than it was, but still near a thirty-year low.
But at least we’re crawling out.
Romney says we’re not doing well enough, and he’s right. But the prescriptions he’s offering – more tax cuts for the rich and for big companies – won’t do anything except enlarge the budget deficit. And the cuts he proposes in public investments like education and infrastructure, and safety nets like Medicare and Medicaid, will take money out of the pockets of people who not only desperately need it but whose spending is necessary to keep the tepid recovery going.
Romney promises if elected the economy will create 12 million new jobs in his first term. If we were back in a normal economy, that number wouldn’t be hard to reach. Bill Clinton presided over an economy that generated 22 million new jobs in eight years – and that was more than a decade ago when the economy and working-age population were smaller than now.
Both Obama and Romney assume the recovery will continue, even at a slow pace, and that we’ll be back to normal at some point. But I’m not at all sure. “Normal” is what got us into this mess in the first place. The concentration of income and wealth at the top has robbed the vast middle class of the purchasing power it needs to generate a full recovery – something that was masked by borrowing against rising home values, but can no longer be denied. Unless or until this structural problem is dealt with, we won’t be back to normal.
Former Massachusetts Gov. Mitt Romney is seated with Ann Romney as his son Craig and grandson Nick as they play a game of Zenga in the family holding room before the start of the first presidential debate in Denver, Wednesday. Reich writes that Romney was repetitive but effective while President Obama came across as passive. (Charles Dharapak/AP)
The first presidential debate: Romney's style trumps Obama's substance
In Wednesday night’s debate, Romney won on style while Obama won on substance. Romney sounded as if he had conviction, which means he’s either convinced himself that the lies he tells are true or he’s a fabulous actor.
But what struck me most was how much Obama allowed Romney to get away with: Five times Romney accused Obama of raiding Medicare of $716 billion, which is a complete fabrication. Obama never mentioned the regressiveness of Romney’s budget plan — awarding the rich and hurting the middle class and the poor. He never mentioned Bain Capital, or Romney’s 47 percent talk, or Romney’s “carried-interest” tax loophole. Obama allowed Romney to talk about replacing Dodd-Frank and the Affordable Care Act without demanding that Romney be specific about what he’d replace and why. And so on.
I’ve been worried about Obama’s poor debate performance for some time now. He was terrible in the 2008 primary debates, for example. Expectations are always high — he’s known as an eloquent orator. But when he has to think on his feet and punch back, he’s not nearly as confident or assured as he is when he is giving a speech or explaining a large problem and its solution. He is an educator, not a pugilist, and this puts him at a disadvantage in any debate.
Romney stayed on script. If you look at a transcript of his remarks you’ll see that he repeated the same lines almost word for word in different contexts. He has memorized a bunch of lines, and practiced delivering them. The overall effect is to make him seem assured and even passionate about his position. He said over and over that he cares about jobs, about small businesses, and ordinary Americans. But his policies and his record at Bain tell a very different story.
The question now is whether Team Obama understands that our President must be more aggressive and commanding in the next two debates — and be unafraid to respectfully pin Romney to the floor.
Stand-ins for moderator Jim Lehrer, center, Republican presidential candidate, former Massachusetts Gov. Mitt Romney, left, and President Barack Obama, right, run through a rehearsal for a debate at the University of Denver Tuesday, in Denver. President Barack Obama and Republican presidential candidate and former Massachusetts Gov. Mitt Romney will hold their first debate Wednesday. Reich offers his thoughts on what the candidates should be asked. (David Goldman/AP)
Presidential debate: the questions they should (but won't) ask Obama, Romney
Governor Romney: You’ve said that you have used every legal method to reduce your tax liability. You’ve also said that as president you would close tax loopholes in order to help finance a major across-the-board tax cut. What specific tax loopholes have you used that you would close? A followup: Would you close the loophole that allows private-equity managers to treat their income as capital gains, subject to a 15 percent tax, even when they risk no capital of their own?
President Obama: You have spoken eloquently of the need to reduce the influence of big money in politics. What specific measures will you advance if you are reelected to accomplish this goal?
Governor Romney: You have promised to repeal the Dodd-Frank bill if you’re elected. Yet our largest Wall Street banks are significantly larger than they were before the near meltdown of 2008. How would you prevent another bank from being too big to fail?
President Obama: The Dallas Federal Reserve Board, one of the most conservative in the nation, has called for a limit to the size of Wall Street banks. Sanford Weill, the creator of Citigroup – one of the largest Wall Street banks – says Wall Street banks should be broken up. If you are reelected, will you support capping the size of Wall Street banks?
Governor Romney: You have said you’d repeal the Affordable Care Act if you’re elected. That would leave 30 million Americans without health insurance. You championed a small version of the Affordable Care Act in Massachusetts. Does that mean you believe it’s more efficient for each state to have its own system for insuring the uninsured?
President Obama: Last December, in a speech you gave in Osawatomie, Kansas, you noted that in the last few decades the average income of the top 1 percent has gone up by more than 250 percent, to $1.2 million per year. For the top one hundredth of 1 percent, the average income is now $27 million per year. And yet, over the last decade the incomes of most Americans have actually fallen by 6 percent. If you’re reelected president, what do you propose to do about this trend?
Governor Romney: Your mathematics has been attacked by those who say it’s impossible to provide the tax cut you propose; expand the military, as you want to do; preserve Medicare and Social Security, as you promise to do; and at the same time balance the federal budget, as you say you’ll do. Can you take us through the math, please, with specific numbers?
President Obama: You have called for equal marriage rights for gay Americans. If you’re reelected, will you support repeal of the Defense of Marriage Act?
Governor Romney: You support states’ rights, and don’t support wealth redistribution. Yet as you know, the citizens of most so-called “blue” states – notably California, New York, and Massachusetts – send more federal tax revenue to Washington than they receive back from Washington, while most of the citizens of “red” states send less tax revenue to Washington than their citizens receive back. Would you, as president, seek to end this subsidy of red states by blue states?
President Obama: In the 2008 campaign you and your opponent, Senator McCain, both supported some version of a “cap and trade” system for limiting emissions of carbon into the atmosphere. During the last four years, evidence has mounted that climate change may be doing irreversible damage to the planet. If you are reelected, will you push for a “cap and trade” system, or a carbon tax, or both?
Governor Romney: America has had some very wealthy men elected president. Your wealth is estimated to be more than a quarter of a billion dollars. The wealthy men elected president – a Republican, Teddy Roosevelt; Franklin D. Roosevelt; and John F. Kennedy – all fought for equal opportunity, reduced the power of large corporations and Wall Street, and gave average working Americans more economic security. Do you share these objectives, and, if you’re elected president, what will you do to achieve them? Please be specific.
President Obama: TARP authorized not only a bailout of Wall Street banks but help to distressed homeowners. You chose not to condition the bailout of Wall Street on the banks reducing the amount people owed on their mortgages. In hindsight, do you think that was a mistake? A follow up question, if I may: It is estimated that one in five American families is still underwater – owing more on their home mortgages than their homes are worth. So far your efforts to help them have fallen far short of the goals you set. If you are reelected, what specific measures will you initiate do more for these families?
Governor Romney: You have campaigned as a “businessman” who has the managerial experience to turn the economy around. Yet some say you’ve run one of the worst campaigns in recent memory – filled with gaffes, misstatements, poor timing, Clint Eastwood, and much else. Conservative columnist Peggy Noonan, for example, calls your campaign a “calamity.” Should Americans be concerned about your management abilities?
President Obama: You faced a particularly truculent Republican congress. But some say you didn’t fight Republicans hard enough during your first term, that you often began negotiations with compromises, and you didn’t use the full powers of your office to get more of what you wanted. Do you think there’s any validity to this criticism and, if so, what will you do differently in your second term?
Republican presidential candidate and former Massachusetts Gov. Mitt Romney leaves his campaign headquarters in Boston, Sunday. Despite the high profile of Wednesday's first presidential debate, Reich writes that the new employment numbers to be released Friday will determine which candidate wins the polls this week. (Charles Dharapak/AP)
The looming specter of jobs and debates
The biggest election news this week won’t be who wins the presidential debate Wednesday night. It will be how many new jobs were created in September, announced Friday morning by the Bureau of Labor Statistics.
Rarely in the history has the monthly employment carried so much political significance. If the payroll survey is significantly more than 96,000 –- the number of new jobs created in August — President Obama can credibly claim the job situation is improving. If significantly fewer than 96,000, Mitt Romney has the more credible claim that the economy isn’t improving.
August’s household survey showed the overall rate of unemployment to be 8.1 percent in August – not bad, relative to previous rates – but that was mainly because so many Americans had stopped looking for work. (You’re deemed “unemployed” only if you don’t have a full-time job and you’re looking for work; if you’ve given up looking, you’re not counted.) ( Continue… )
Republican presidential candidate and former Massachusetts Gov. Mitt Romney greets supporters after a speech at The Seagate Center in Toledo, Ohio, Wednesday. Reich argues that voters are skeptical towards any attempt by Romney to rebrand himself as a compassionate conservative. (Rick Osentoski/AP)
Mitt Romney: a compassionate conservative?
“My heart aches for the people I’ve seen,” Mitt Romney said, on the second day of his Ohio bus tour. He’s now telling stories of economic hardship among the people he’s met.
Up until now, Romney’s stories on the campaign trail have been about business successes – people who started businesses in garages and grew their companies into global giants, entrepreneurs who succeeded because of grit and determination, millionaires who began poor. Horatio Alger updated.
Curiously absent from these narratives have been the stories of ordinary Americans caught in an economy over which they have no control. That is, most of us.
At least until now.
“I was yesterday with a woman who was emotional,” Romney recounts, “and she said, ‘Look, I’ve been out of work since May.’ She was in her 50s. She said, ‘I don’t see any prospects. Can you help me?’”
Could it be Romney is finally getting the message that many Americans need help through no fault of their own?
“There are so many people in our country that are hurting right now,” Romney says. “I want to help them.”
Later in the day, Romney told NBC that because of his efforts as governor of Massachusetts, “one hundred percent of the kids in our state had health insurance. I don’t think there’s anything that shows more empathy and care about the people of this country than that kind of record.”
But the repackaging of Mitt as a compassionate conservative won’t work. The good citizens of Ohio — as elsewhere — have reason to be skeptical.
This is, after all, the same Mitt Romney who told his backers in Boca Raton that 47 percent of Americans are dependent on government and unwilling to take care of themselves.
It’s the same Romney who was against bailing out GM and Chrysler. One in eight jobs in Ohio is dependent on the automobile industry. Had GM and Chrysler gone under, unemployment in Ohio would be closer to the national average of 8.1 percent than the 7.2 percent it is today.
This is the same Romney who has been against extending unemployment benefits. Or providing food stamps or housing benefits for families that have fallen into poverty. Or medical benefits. To the contrary, Romney wants to repeal Obamacare, turn Medicare into vouchers, and turn Medicaid over to cash-starved states.
This is the same Mitt Romney who doesn’t worry that Wall Street financiers — including his own Bain Capital — have put so much pressure on companies for short-term profits that they’re still laying off workers and reluctant to take on any more.
And the same Mitt who doesn’t want government to spend money repairing our crumbling infrastructure, rebuilding our schools, or rehiring police and firefighters and teachers.
Romney says he feels their pain but his policy prescriptions would create more pain.
Mitt Romney’s real compassion is for people like himself, whom he believes are America’s “job creators.” He aims to cut taxes on the rich, in the belief that the rich create jobs — and the benefits of such a tax cut trickle down to everyone else.
Trickle-down economics is the core of Romney’s economics, and it’s bunk. George W. Bush cut taxes — mostly for the wealthy — and we ended up with fewer jobs, lower wages, and an economy that fell off a cliff in 2008.
In Ohio Romney is repeating his claim that, under his tax proposal, the rich would end up paying as much as before even at a lower tax rate because he’d limit their ability to manipulate the tax code. “Don’t be expecting a huge cut in taxes because I’m also going to be closing loopholes and deductions,” he promises.
But Romney still refuses to say which loopholes and deductions he’ll close. He doesn’t even mention the “carried interest” loophole that has allowed him and other private-equity managers to treat their incomes as capital gains, taxed at 15 percent.
What we’re seeing in Ohio isn’t a new Mitt Romney. It’s a newly-packaged Mitt Romney. The real Mitt Romney is the one we saw on the videotape last week. And no amount of re-taping can disguise the package’s true contents.
Republican presidential candidate and former Massachusetts Governor Mitt Romney speaks at the Clinton Global Initiative in New York Tuesday. Reich argues that Romney is behind in polls due to Americans' distaste with extreme right-wing beliefs in the Republican party. (Brian Snyder/Reuters)
The real reason Romney is losing
I’ve spent the past few days debating right-wingers — among them, Grover Norquist and Ann Coulter. This isn’t my idea of fun. I do it because apparently many Americans find these people persuasive, and it seems important to try to show why they’re profoundly wrong.
There are two major theories about why Romney is dropping in the polls. One is Romney is a lousy candidate, unable to connect with people or make his case.
The second is that Americans are finally beginning to see how radical the GOP has become, and are repudiating it.
Many Republicans — including some of the right-wingers I’ve been debating — hold to the first view, for obvious reasons. If Romney fails to make a comeback this week, I expect even more complaints from this crowd about Romney’s personal failings, as well as the inadequacies of his campaign staff.
But the second explanation strikes me as more compelling. The Republican primaries, and then the Republican convention, have shown America a party far removed from the “compassionate conservatism” the GOP tried to sell in 2000. Instead, we have a party that’s been taken over by Tea Partiers, nativists, social Darwinists, homophobes, right-wing evangelicals, and a few rich people whose only interest is to become even wealthier.
These regressives were there in 2000, to be sure. They lurked in the GOP in the 1990s, when Newt Gingrich took over the House. They were there in the 1980s, too, although Ronald Reagan’s sunny disposition gave them cover. In truth, they’ve been part of the GOP for more than half a century — but never before have they held so much sway in the party, never before have they called the shots.
The second view about Romney’s decline also explains the “negative coat-tail” effect — why so many Republicans around the country in Senate and House races are falling behind. Scott Brown, for example, is well-liked in Massachusetts. But his polls have been dropping in recent weeks because he’s had to carry the burden of the public’s increasing dislike of the Republican Party. The same is true with regard to Republican senate races in Florida, Virginia, and every other battleground state.
Romney’s failing isn’t that he’s a bad candidate. To the contrary, he’s giving this GOP exactly what it wants in a candidate. And that’s exactly the problem for Romney — as it is for every other Republican candidate — because what the GOP wants is not at all what the rest of America wants.
Republican presidential candidate and former Massachusetts Governor Mitt Romney acknowledges the cheers from the crowd at a campaign rally in Pueblo, Colo., Monday. Romney pays a tax rate of only 14 percent on $13 million of income in 2011 because he exploits a loophole that allows private equity managers to treat their income as capital gains, Reich writes. (Brian Snyder/Reuters)
Mitt Romney: A warrior for the wealthy?
It’s not just his giant income or the low tax rates he pays on it. And it’s not just the videotape of him berating almost half of America, or his endless gaffes, or his regressive budget policies.
It’s something that unites all of this, and connects it to the biggest underlying problem America faces — the unprecedented concentration of wealth and power at the very top that’s undermining our economy and destroying our democracy.
Romney just released his 2011 tax returns, showing he paid $1.9 million in taxes on more than $13 million of income last year — for an effective tax rate of 14.1 percent. (He released his 2010 return in January, showing he paid an effective tax rate of 13.9 percent.)
America has had hugely wealthy presidents before — think of Teddy Roosevelt and his distant cousin, Franklin D. Roosevelt; or John F. Kennedy, beneficiary of father Joe’s fortune.
But here’s the difference. These men were champions of the working class and the poor, and were considered traitors to their own class. Teddy Roosevelt railed against the “malefactors of great wealth,” and he busted up the oil and railroad trusts.
FDR thundered against the “economic royalists,” raised taxes on the wealthy, and gave average working people the right to form unions — along with Social Security, unemployment insurance, a minimum wage, and a 40-hour workweek.
But Mitt Romney is not a traitor to his class. He is a sponsor of his class. He wants to cut their taxes by $3.7 trillion over the next decade, and hasn’t even specified what “loopholes” he’d close to make up for this gigantic giveaway.
And he wants to cut benefits that almost everyone else relies on — Medicare, Medicaid, Social Security, food stamps, unemployment insurance, and housing assistance.
He’s even a warrior for his class, telling his wealthy followers his job isn’t to worry about the “47 percent” of Americans who won’t vote for him, whom he calls “victims” and he berates for not paying federal incomes taxes and taking federal handouts.
(He mangles these facts, of course. Almost all working Americans pay federal taxes — and the federal taxes that have been rising fastest for most people are Social Security payroll taxes, which aren’t collected on a penny of income over $110,100. Moreover, most of the “47 percent” whom he accuses of taking handouts are on Medicare or Social Security — the biggest “entitlement” programs — which, not incidentally, they paid into during their working lives.)
Money means power. Concentrated wealth at the top means extraordinary power at the top. The reason Romney pays a rate of only 14 percent on $13 million of income in 2011 — a lower rate than many in the middle class — is because he exploits a loophole that allows private equity managers to treat their income as capital gains, taxed at only 15 percent.
And that loophole exists solely because private equity and hedge fund managers have so much political clout — as a result of their huge fortunes and the money they’ve donated to political candidates — that neither party will remove it.
In other words, everything America is learning about Mitt Romney — his tax returns, his years at Bain Capital, the video of his speech to high-end donors in which he belittles half of America, his gaffes, the budget policies he promotes — repeat and reenforce the same underlying reality.
So much wealth and power have accumulated at the top of America that our economy and our democracy are seriously threatened. Romney not only represents this problem. He is the living embodiment of it.
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