For the last 30 years, the richest 1% of Americans has had great growth in income and wealth, while the lower 99% has experienced almost no growth. This led inexorably by 2008 to a concentration of wealth comparable to that existing in 1928, just before the start of the Great Depression. Among other things, this means by definition that the ultra-rich have not paid a proportional share of the cost of government.
They have not had to, because they have been running our federal government. In fact, the government has been for many of them their most effective means of making money. Instead of investing their money in open markets and working to compete for earnings, they have tapped into the mother-load of potential wealth, the huge pool of tax dollars constantly collected from all Americans by the IRS. In contracts with government, which is supposed to spend tax revenues in the public interest, they have made huge, often excessive profits doing things that have not improved the lives of ordinary citizens: They have fought discretionary wars overseas while the infrastructure and the environment at home have continued to deteriorate.
That would be bad enough if limited to current tax dollars, but while in control of our federal government they have used its institutions to borrow extensively, well beyond the taxpayers’ current means, enabling them to make even more profits on government contracts.
The amount of federal debt run up by the Reagan/Bush/Bush administrations, including compounded interest, is $12.1 trillion, most of the $14 trillion total of national debt now outstanding. This staggering debt also benefits the very rich: All taxpayers are paying huge amounts of interest on the federal debt to extremely wealthy people who disproportionately hold that debt, further contributing greatly to their wealth, and to income inequality and poverty.
Meanwhile, as we are well aware, the rest of Americans (the lower 99%) are greatly suffering from having all that money taken from them and converted to purposes contrary to their interests. They are losing their jobs, their pensions, and their homes. They are finding it hard to get health care, or go to school, or pay their mortgages. Many millions are finding it hard to survive as they watch the American way of life rapidly decline around them.
Polls show (understandably) that American taxpayers want a balanced budget, at long last, but that they also (understandably) do not want their government to balance the budget on their backs. And they want their government to create jobs and reduce the unemployment within their ranks caused by the rich getting richer and cutting their own taxes.
But after decades of paying an excessive share of taxes so the super rich could get even richer, the lower 99% now witnesses a surreal spectacle: House Speaker Boehner pretends to justify the elimination of the remaining federal programs that benefit taxpayers as something they want and voted for! The victims of these cuts are students, teachers, retired people, anyone needing medical care, and so on, as well as anyone working in these programs. The ultimate victims are the entire lower 99%, all of us.
“The people,” Mr. Boehner likes to say, “have spoken.” But when it was pointed out to him that the budget he proposes would only further harm the economy and cause the loss of another 700,000-1,000,000 jobs over the next few years, Mr. Boehner’s icy response was this: “So be it.”
JMH – 3/4/11