It also goes to show that having a friend or loved one who is gay makes all the difference, instead of discussing abstract groups of people.
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Thursday, August 15, 2013
Colbert: Progressive, small-town...Kentucky?
It also goes to show that having a friend or loved one who is gay makes all the difference, instead of discussing abstract groups of people.
Saturday, January 26, 2013
Dems have always championed the 'out-groups'
Notice that the Democratic Party changed its ideology, from anti-government to pro-government. But the party did not change its allegiance. The Democratic Party remained the party of out-groups. Only now, those out-groups saw the federal government as their ally, not their enemy. Under President Obama, the Democratic coalition includes working and single women, African-Americans, Latinos, Asian-Americans, gay people, young people, Jewish voters, educated professionals, and the "unchurched" (the one-fifth of Americans who say they have "no religion").That's the New America. For different reasons, they all see themselves as out-groups. They see the federal government as a force that protects their interests and promotes their values. They see the Republican Party as the party of entrenched wealth and privilege (i.e., Mitt Romney). What's changed is that the New America is becoming the nation's majority. Democrats have carried the popular vote in five out of the last six presidential elections.
Friday, December 14, 2012
Ames: Sordid, bloody history of 'right to work'
"From now on, white women and white men will be forced into organizations with black African apes whom they will have to call ‘brother’ or lose their jobs."— Vance Muse, founder of the "right to work" anti-labor campaign
"The man Muse is quite a character. He is six foot four, wears a ten-gallon hat, but generally reserves his cowboy boots for trips Nawth. Now over fifty [this is published in 1946—M.A.], Muse has been professionally engaged in reactionary enterprises for more than a quarter of a century."
The modern Right-to-Work movement and political mobilization championing this slogan...was spearheaded by the Christian American Association out of Houston in the early 1940s.
"After traveling to Dallas and consulting with the editor, Muse was encouraged to use and promote the idea of Right-to-Work. This became their [Christian American’s] primary cause and they campaigned extensively for Right-to-Work legislation throughout the country, and especially in Texas."
...stood for "$15 a week salary for all nigger house help, Sundays off, no washing, and no cleaning upstairs." As an afterthought, she added,"My nigger maid wouldn’t dare sit down in the same room with me unless she sat on the floor at my feet!"Allowing herself to go still further, the little lady went on to say, "Christian Americans can’t afford to be anti-Semitic, but we know where we stand on the Jews, all right. It doesn’t pay us to work with Winrod, Smith, Coughlin, and those others up North; they’re too outspoken and would get us into trouble...You’d be surprised how many important corporations support our work."- Southern Exposure, Stetson Kennedy
"Union groups throughout the country are asking [for] an investigation of the Christian American Association which has been pushing anti-labor bills in many state legislators. Anti-Semitic and anti-Catholic literature has also been attributed to the Christian Americans."
Sunday, November 11, 2012
West: 'We end up with a Republican in blackface'
CORNEL WEST: Well, one, I think that it’s morally obscene and spiritually profane to spend $6 billion on an election, $2 billion on a presidential election, and not have any serious discussion—poverty, trade unions being pushed against the wall dealing with stagnating and declining wages when profits are still up and the 1 percent are doing very well, no talk about drones dropping bombs on innocent people. So we end up with such a narrow, truncated political discourse, as the major problems—ecological catastrophe, climate change, global warming. So it’s very sad. I mean, I’m glad there was not a right-wing takeover, but we end up with a Republican, a Rockefeller Republican in blackface, with Barack Obama, so that our struggle with regard to poverty intensifies.
Wednesday, January 11, 2012
David Brooks: Why aren't there more liberals?

Tuesday, September 13, 2011
Strategic advice for liberal-progressive losers
Thursday, August 20, 2009
Gallup: America reddening?

Can't believe I missed this one. And I can't believe you Repugs didn't rub this in my face!
"Conservatives" Are Single-Largest Ideological Group
Percentage of "liberals" higher this decade than in early '90s
By Lydia Saad
June 15, 2009 | Gallup.com
______________________________________________________
UPDATED with my comments to actual conservatives!
Did you follow that link? For example, 54% of Americans favor legal unions for gays. Is that conservative? Or have you seen the polls about the 77% of people who want a public option in the health care bill? Is that conservative? Or the pretty high number -- 39% now, but it was 50% in 2007 when Dubya was in office -- of Americans who favor stricter gun control laws, and the only 15% of people who want current gun laws to be less strict? Or, worst of all, the polls that show steadily about 60% of Americans continue to support Roe v. Wade.
Monday, February 4, 2008
Reich: Progressive tax & reform agenda
Financing the Common Good
By Robert B. Reich
February 1, 2008 | Prospect.org
> ... A new Democratic president coming into office in 2009 will face a national debt much larger than it was in 1993. Despite the $5 trillion 10-year budget surplus that ended the Clinton years, the federal debt at the end of the Bush years will be almost $4 trillion larger than it was then. It will have grown about 70 percent during Bush's reign.
> ... the administration of George W. Bush has exploited the asymmetry in American politics. By trashing the institutions of government, the younger Bush personified his central thesis that government cannot be trusted to do anything well. He has shown that Republicans cannot lose at this game. There is no downside in treating government like a sewer. To the extent they have been careless or negligent with it, or crassly mendacious, illegally rewarding cronies and punishing opponents, splurging and plundering at every turn, they still come out on top. If, against all odds, a program or initiative somehow succeeds, they can show how wise they were all along. If programs or initiatives fail, as has been more likely, the failures only illustrate why citizens and taxpayers should not rely on government in the first place. Bush has thus enlarged upon the Reagan-era fiscal tactic of "starving the beast" of revenues into a more insidious strategy of starving the beast of public trust.
> ...Increase the staffing of regulatory agencies charged with protecting the public, and appoint regulators who believe in protecting citizens. See to it that corporate lawbreakers are prosecuted vigorously. There is no better means of demonstrating to the public why government is necessary and, not incidentally, that you are not in the pockets of the powerful. Crack down on unsafe products, sweatshops, consumer fraud, bribery, the looting of corporations by executives, illegal firings, sexual harassment, oil spills, predatory lending, insurance companies that fail to honor their policies, underfunded pension plans, corruption in the awarding of government contracts. Protect corporate whistleblowers. Publicly castigate CEOs who endanger or defraud the public.
> ...Where to get the additional money? Three sources: The peace dividend from ending the Iraq War, a more progressive tax, and modest deficit spending. Because many of America's deferred needs are felt so directly by a large majority of citizens -- health care, early education, child care, training for good jobs, better public transit, and so on -- you can gain support for additional revenue if you educate the public about what you're doing and why.
Start with the peace dividend. According to government figures, the wars in Iraq and Afghanistan have so far cost the United States more than half a trillion dollars. Another four years would cost significantly more, because this figure doesn't include the ever larger costs of recruitment or the cost of replacing the equipment that's been used in the war so far. If you ended the war, it's safe to say that the peace dividend would be more than $100 billion a year, even including the costs of attending to our wounded.
The only people who have the money necessary to reverse the nation's troubling trends are at the top. Recent data from the IRS show that the wealthiest 1 percent of Americans are earning more than 21 percent of all income -- a postwar record -- while the bottom 50 percent of Americans combined are earning just 12.8 percent of total income. (Right-wingers have attacked these data by arguing that the IRS improperly counts adjusted gross income, but however you try to bend the numbers the trend is unmistakable.)
Explain to the public that even as income and wealth have become more concentrated than at any time in the past 80 years, those at the top are now taxed at lower rates than rich Americans have been taxed since before the start of World War II. Taxpayers who bring home over $5 million annually now pay less than 22 percent of their incomes in federal tax, on average. Managers of hedge funds, private-equity partners, and many venture capitalists are paying no more than 15 percent -- since their earnings are, absurdly, treated as capital gains. This means that America's wealthiest, who have been receiving most of the economy's bounty, are paying a smaller percentage of their income in taxes than are middle-class Americans. Financiers who are raking in hundreds of millions -- last year, each of the 25 highest paid hedge-fund managers took in an average of $560 million -- are paying at a lower rate than many of America's working poor who barely clear $20,000 annually.
How to sell a higher marginal tax on the wealthy? Emphasize that there's no way the country can do what's needed unless more money is raised -- and yet, if the rich don't pay their fair share, the burden will fall on a middle class that's already financially strapped. By the same token, only a relatively few at the top would need to pay more. According to the Institute on Taxation and Economic Policy, if the marginal income tax rate on Americans whose yearly income exceeds $10 million were raised to 70 percent, and the rate for those who earn between $5 million and $10 million a year were raised to 50 percent, federal revenues in 2008 would increase by $105 billion. By my calculation, a tiny annual wealth tax of one-tenth of 1 percent on all net worth exceeding $5 million -- a tax that would affect only 50,000 households, or fewer than one-tenth of 1 percent of the nation's taxpayers -- would yield an additional $100 billion.
Point out that a progressive income tax has been a cornerstone of our fiscal system since 1913 -- and our current non-progressive and often regressive tax is the anomaly. In World War II, rich Americans paid a marginal rate of over 68 percent of their incomes in federal taxes, even after exploiting every tax loophole they could find. In the 1950s, under Dwight Eisenhower, the highest marginal rate was over 90 percent, and even after using all the deductions and credits, the rich paid almost 52 percent.
[...]
Saturday, January 26, 2008
A Real Progressive Tax Policy?
By Ezra Klein
January 24, 2008 | Prospect.org
[...]
Consumption taxes, however, do not need to be sales taxes, and they do not need to be flat. Cornell economist Robert Frank has a particularly elegant proposal for a progressive sales tax that's tabulated at year's end, rather than at the point of sale. Under his system, come tax time, families would report their income, just as they do now, but also their savings (how much they've invested, kept in the bank, etc). The difference between the two would be their taxable consumption. Everyone would then get a standard deduction of $30,000, effectively exempting low-income families from taxation altogether. As the total taxable consumption rose, so too would the rates, just as is true now. A taxable consumption of $15,000 might pay 10 percent in taxes. At $8 million the top rate could be as high as we chose to make it.
This could have substantial benefits. "Consider a family that spends $10 million a year and is deciding whether to add a $2 million wing to its mansion," Frank writes. "If the top marginal tax rate on consumption were 100 percent, the project would cost $4 million. The additional tax payment would reduce the federal deficit by $2 million. Alternatively, the family could scale back, building only a $1 million addition. Then it would pay $1 million in additional tax and could deposit $2 million in savings. The federal deficit would fall by $1 million, and the additional savings would stimulate investment, promoting growth. Either way, the nation would come out ahead with no real sacrifice required of the wealthy family, because when all build larger houses, the result is merely to redefine what constitutes acceptable housing."
Thursday, September 6, 2007
Give tax credits to ALL U.S. taxpayers
I await your howls and vociferous objections!
Why extending income tax credits to payroll tax payers should be the next big idea in American politics -- politically unassailable, progressive economics on a grand scale.
Michael Lind
Prospect.org | September 3, 2007
The Democrats are a potential majority party in need of a major idea with potential. The major idea that built a Republican majority starting with Ronald Reagan's election was simple: cutting income taxes, with or without cuts in spending. The Republicans reduced income tax rates and then they cut big holes in those rates by creating new or enlarged tax credits available only to Americans who pay income tax.
Meanwhile payroll taxes have risen for working Americans who, because they pay little or no income tax, are ineligible for a range of tax breaks from the $1,000-a-year child tax credit to the home mortgage interest deduction.
Some progressives hope to reverse a generation of Reaganism by repealing George W. Bush's income tax cuts in order to pay for major new spending programs. But the stigma attached to "tax-and-spend" liberalism by a generation of conservative propaganda remains. Equally dubious is the strategy proposed by neoliberal Democrats, whose slogan seems to be: "no pain, no gain." Their formula of budget-balancing fiscal conservatism plus tiny, symbolic subsidies has no popular appeal.
Instead the Democrats should take a leaf from the Republican playbook and position themselves as the party of deep tax cuts for working Americans. What the Reaganites did for affluent income tax payers, Democrats (and like-minded Republicans) can do for America's working-class majority.
Here is a majority-making idea: Make all Americans who pay payroll taxes eligible for every existing income tax credit -- the child tax credit, the home mortgage interest deduction, all of them. With a single stroke, this would accomplish two important goals. First, it would provide substantial tax relief for working Americans who pay only, or chiefly, payroll taxes. Second, it would permit these same payroll tax payers to enjoy the same tax breaks that more affluent income tax payers now enjoy exclusively.
The party that opens up all income tax breaks to all payroll tax payers might be able to consolidate the next majority in American politics, a majority built on center-left, tax-cut Reaganism for the masses, not the elites.
If you're like most Americans, you pay the federal government more money in the form of the 15.3 percent payroll tax taken out of your paycheck every two weeks than you pay in income tax. Even Americans making between $65,000 and $100,000 a year, well above the national median income, pay a greater share of their federal tax dollar for payroll tax than for income tax. You have to be in the highest-earning 20 percent of Americans to pay more income tax than payroll tax.
You'd think that politicians in Washington would be eager to relieve voters of the payroll tax burden, right? Wrong.
Since 1980 the payroll tax has been hiked several times. Meanwhile federal income taxes have been slashed repeatedly -- to the benefit, chiefly, of the rich. The wealthiest 5 percent of taxpayers saw their effective federal tax rates fall from 30.1 percent in 2001 to 25.6 percent in 2004, according to the Congressional Budget Office (CBO). And they have benefited even more from steep reductions in taxes on capital gains and dividends.
To make matters worse, more and more of the burden of paying for the federal government has shifted to the payroll tax, which hits middle-class workers the hardest. As a percentage of federal revenue, the payroll tax rose from 27 percent in 1973 to a whopping 40 percent in 2003.
It gets even worse. In the past generation, Congress has quietly expanded an invisible welfare state for the well-to-do -- a generous system of income tax subsidies that is off limits to tens of millions of working-class and middle-class Americans.
Here's how the tax-break welfare state for the affluent works: The IRS allows them to take advantage of a number of different tax credits, from the home mortgage interest deduction to the $1,000-a-year child tax credit to a separate credit for money spent by working parents on child care. Under the current tax system, the affluent are also able to shelter large amounts from taxes in tax-preferred savings vehicles like IRAs and Keogh Plan pensions.
Here's the catch: You can only claim these tax credits against income taxes, not against payroll taxes. One-third of American families pay only payroll tax and no income tax. If you belong to one of those families, you're out of luck.
And even if you pay income tax on top of payroll tax, you can only claim these credits for your income tax liability. In theory income tax payers can claim thousands of dollars in total for various deductions -- but only if they pay that amount or more in income taxes. The more money you make, the greater your subsidy from the government! Here's one example: In 2005 families earning more than $75,000 saved twice as much money using the child tax credit as families earning less than $30,000.
And we haven't even mentioned corporate income tax breaks that chiefly benefit the economic elite in this country. Hundreds of billions of dollars in potential federal revenues are lost each year because of private company health care plans and pensions -- including "gold-plated" plans for corporate executives. If you work for an employer who does not provide either health care or a pension, you're out of luck again.
Reforms in recent decades have created a three-caste society for purposes of taxation. At the bottom, the poor have largely been exempted from taxation and receive such generous tax subsidies as the Earned Income Tax Credit (EITC). At the top, income tax rates have fallen, and the reduced rates, in turn, have been hollowed out by a system of generous tax credits for upper-income households. Stuck in between the affluent and the poor are working-class Americans. They make too much money to receive means-tested subsidies for the poor like the EITC. But they do not qualify for the income-tax welfare state of the affluent because they pay little or no federal income tax. The chief federal tax they pay is the combined Social Security/Medicare payroll tax, for which there are no tax credits comparable to those available to affluent income tax payers.
To put it another way, the United States has moved away from a system of universal social insurance for the broad middle class toward two means-tested welfare states taking the form of tax expenditures and administered by the IRS: a tax-credit welfare state for the poor (the EITC) and another tax-credit welfare state for the affluent.
The idea of granting payroll tax relief has been around since the 1980s. Until now ideas for payroll tax relief have taken four forms: abolition of the payroll tax, permanent payroll tax rate cuts, rebates for payroll taxes, and the extension of the child tax credit to workers who pay payroll tax but not income tax.
Al Gore has proposed abolishing the payroll tax and replacing it with a carbon tax. In our book The Radical Center (2001), Ted Halstead and I proposed replacing the payroll tax with a progressive consumption tax. There is little political support, however, for completely substituting a new tax for the payroll tax.
In the early 1990s, Senator Daniel Patrick Moynihan proposed permanently cutting payroll taxes so that they met only annual Social Security obligations. Richard Darman, the budget director for President George H.W. Bush, called it "the most irresponsible budget idea of the 1990s." Moynihan's proposal went nowhere in a decade marked by hysteria about the alleged looming bankruptcy of Social Security.
Robert Reich, in this magazine, was just one of a number of writers who floated the idea of payroll tax rebates in the early 2000s, as part of efforts to devise a progressive alternative to the further round of income tax cuts proposed by the current President Bush and enacted by the Republican Congress. Like proposals for the abolition of payroll taxes and Moynihan's proposed rate cuts, the rebate proposals would help many working Americans. But all three kinds of proposed reforms are completely unconnected to the question of income tax expenditures, which would continue to exist and continue to be unavailable to payroll tax payers.
The link between income tax credits and the payroll tax was actually made by Newt Gingrich and his Republican colleagues in the 1994 Contract with America. The Contract proposed extending the then-novel child tax credit to working parents who paid payroll taxes but not income taxes. Once in power, the Republicans reneged on their promise, and to this day the child tax credit is available only to parents who pay income tax. But the idea did not die. It was recently revived by the Center for American Progress, which has proposed making the child tax credit refundable to all families who pay payroll taxes.
This is an excellent idea -- but why limit the reform to only one tax credit? Here is a simple, bold, and elegant proposal which at one stroke would universalize the income tax credit system and, at the same time, grant significant payroll tax relief to stressed American households: Make all Americans who pay payroll taxes eligible for all existing income tax credits for children, housing, education, savings, and other purposes. Every single tax credit that can now be claimed by individual income tax payers, from the child tax credit to the home mortgage interest deduction, should be available to all Americans who pay the payroll tax. Every single one. No exceptions.
Call it the Total Tax Credit (TTC) system. Under the TTC system, even if you don't pay income taxes, your employer would let you deduct your tax credits from the payroll tax that is sent to the government every two weeks.Result: fatter biweekly paychecks for all American workers. The biggest winners would be those who could claim the most TTC deductions: home-owning families with dependent children. But even single, childless renters who don't pay income tax, or pay only a small amount, could benefit as well -- for example, from tax credits for savings. In this way, today's tax credit system exclusively for income tax payers would be turned overnight from a professional-class gated community into a mainstream middle-class neighborhood.
But wait, wouldn't allowing payroll tax payers to claim credits against the payroll tax blow a huge hole in revenues? Wouldn't we need to make up for the lost revenue in order to fund Social Security and Medicare? Of course we would. And we could, in various ways.
The first step would be to lift the cap on payroll taxation, which is now $97,500 a year. The American public supports the idea of lifting the cap on Social Security payroll taxes. In a February 2005 Washington Post poll, 81 percent said that Americans who make more than the present limit should pay Social Security tax on their wage income. There is a precedent for this long-overdue reform: In 1993 Congress removed the similar cap that previously existed on Medicare taxes on wage income.
Would lifting the cap hurt mainstream Americans? Hardly. Only the top 5 percent or 6 percent of wage earners would see their Social Security tax go up. These are the same people who have received most of the benefits from tax cuts over the past 30 years. They can afford it.
Lifting the cap while keeping benefits for affluent retirees unchanged would produce a surplus for Social Security for the next 75 years. But this assumes no payroll tax relief for middle-income workers. If we adopt the Total Tax Credit system, then the money that streams in from applying payroll taxation to wage income higher than $97,500 would fill part of the revenue shortfall created by extending income tax credits to payroll tax payers. But we would still need to cut spending elsewhere or come up with new revenues.
How about imposing a cap on tax expenditures -- while lifting the cap on payroll tax? Right now the benefits of the home mortgage deduction go disproportionately to the richest Americans with the biggest houses. Capping the home mortgage interest deduction at, say, the median amount spent by homeowners would result in new revenue flowing from the rich into federal coffers -- without raising existing federal income tax rates at all. Politically speaking it's much more attractive to raise revenue by capping income tax loopholes than to raise income tax rates. Reducing the amount of money the wealthy can shelter in tax-favored savings vehicles alone would result in a flood of new revenues to the Treasury. The price of extending today's income-tax-only credits to all American payroll tax payers without bankrupting the government may be to make all tax credits -- for housing, children, and education -- more modest. But that's how it should be, anyway.
The Total Tax Credit system would also affect the economy indirectly, to the benefit of the broad middle class. As take-home pay for working people increased, the economy's spending on housing, day care, and other sectors would come to include the less affluent. A universalized home mortgage interest deduction capped below the current $1 million would encourage realtors to build a greater number of modest homes, rather than second homes and McMansions. Day-care centers would find a new clientele in working-class parents as well as professionals. Allowing payroll tax payers to cut their payroll tax by saving money in tax-favored retirement accounts would create an entirely new source of capital for banks. America's tax-credit-subsidized economy would shift downmarket -- and about time, too.
Lifting the cap on payroll taxes while capping the newly universal tax credits might still result in revenue shortfalls. We could increase other taxes that fall lightly on working people, such as income taxes, taxes on capital gains and dividends, and estate taxes. Or we could raise revenue from new taxes, like a national sales tax or value-added tax (VAT) on luxury goods. Think about it -- a national tax on luxuries enjoyed by the wealthy could help to pay the cost of extending tax breaks now enjoyed by elite income tax payers to ordinary payroll tax payers.
But our representatives should prefer to raise new revenue to pay for the Total Tax Credit system by means of consumption taxation rather than higher income taxes, and the reason is political, not economic. Consumption taxes, like national VATs elsewhere in the world, state and local sales taxes in the United States, and, for that matter, payroll taxes, have the political advantages of being inescapable and invisible. Payroll and consumption taxes are difficult if not impossible to avoid. And even more importantly, because they are relatively invisible compared to highly transparent taxes like the income tax and property tax, consumption taxes and payroll taxes are less likely to provoke tax revolts.
In Europe the architects of generous social-insurance systems have been wise to rely heavily on non-transparent taxes like payroll taxes and consumption taxes. While these are regressive, in Europe their effect has been moderated by progressive spending. In the taxophobic United States, we could achieve the same result by making our tax burden more progressive. Social-democratic purists may lament the fact that so much public policy in the United States is done via the tax code rather than direct spending programs. But instead of complaining that the United States is not Sweden, American progressives and centrists ought to make a virtue of necessity and make the existing tax-expenditure welfare state nearly universal (by allowing payroll tax payers to participate) and more progressive (by capping the new federal total tax expenditures).
What about the politics of the total tax credit proposal? Two questions must be addressed: Would it endanger public support for Social Security? And would it be popular with voters?
The first question is whether it is wise partly to sever the link between payroll taxes and Social Security expenditures, something that any major payroll tax relief plan without major Social Security spending cuts would do. Franklin D. Roosevelt conceded that the payroll tax was a regressive tax, but argued that the link between contributions and payouts was necessary so that "no damn politician can ever scrap my Social Security program." The same logic has inspired many progressives as well. Like FDR, they fear that Social Security would no longer be viewed as social insurance for the middle class but as a redistributive welfare program for the elderly poor. And as the saying goes, "programs for the poor are poor programs."
The evidence suggests, however, that there is little basis for the fear that Social Security will lose public support if it is funded by taxes other than payroll tax. Some of the evidence comes from abroad, from countries that fund their public pension systems partly or wholly out of general revenues. But the most convincing evidence comes from here in the United States. Medicare is divided into two programs, Part A and Part B. Part A is funded by the Medicare payroll tax. Part B is funded in part from general revenues. In spite of this mixture of streams of funding, support for Medicare as a whole remains strong -- so strong, in fact, that Bush and the Republican Congress presided over the biggest expansion in Medicare expenditures since the program's inception, in the form of the Medicare drug benefit.
The truth is that whether programs are popular or not seems to have no connection to how they are funded. Social Security in particular remains the "third rail" of American politics. By endorsing partial privatization of Social Security, Bush boldly seized the third rail -- and was promptly shocked. Public reaction to his idea was so hostile that the idea died, even in a Republican Congress.
The same fate undoubtedly awaits proposals to impose radical means-testing and steep cuts on middle-class Social Security payments as an alternative to raising taxes to cover Social Security costs. By paying for Social Security out of general revenues or other dedicated taxes, the solvency of Social Security can be assured, even as the Total Tax Credit system slashes payroll tax for most Americans.
The larger political issue remains to be addressed: will the Total Tax Credit system play in Peoria? The answer is obvious: It is hard to imagine a proposal that would be more popular with the American public.
The swing vote in American politics since the 1960s has consisted of high-school-educated white working-class populists -- Reagan Democrats or Jim Webb Republicans. A slight shift of these voters gave Congress to the Republicans in 1994 and took it away in 2006. In theory the Democrats can build a bare-majority coalition on the basis of affluent liberal whites, blacks, and Latinos. But a veto-proof Democratic supermajority in Congress capable of passing reform legislation, with or without a Democratic president, cannot exist in the foreseeable future unless white working-class swing voters are welded to the party. And these are the very voters who would benefit the most from the Total Tax Credit system.
What do today's Democrats offer these voters? The neoliberal wing offers Rubinomics -- deficit reduction, cuts in middle-class entitlements like Social Security, and symbolic microsubsidies. For the working class, Rubinomics is all pain and no gain -- their Social Security benefits would be slashed under most neoliberal Social Security solvency plans, and new subsidies would be means-tested programs for the poor for which the working class is ineligible.
The left wing of the Democratic party is more in tune with the operational economic liberalism of working-class voters, who tend to be New Deal liberals when it comes to spending (if not taxing) and moderate conservatives when it comes to social issues. But the 2006 election was a referendum on a lost war, not a sign that the public in general -- and working-class swing voters in particular -- want more direct public spending.
The TTC system offers Democrats a third way: putting money in the pockets of working-class voters by cutting their taxes, not by appropriating more money for federal programs. This Reaganism for the masses is immune to political attack by Reaganites themselves. The gloomy deficit hawks in both parties can flap their wings and squawk about how irresponsible it is to cut the payroll tax, even if the cap is raised. But progressives are likely to find allies among two groups of conservatives: populist supply-siders and family-values social conservatives like Allan Carlson, who have been arguing for tax relief for working-class families for years.
Conservatives have had considerable success in arguing against making income tax credits refundable for the non-tax-paying poor. They argue that the very concept of "tax expenditures," which treats special-purpose tax breaks like the child tax credit as the equivalent of government spending, is an academic fiction. In reality, they argue, these tax breaks are not government subsidies at all. The government is simply allowing taxpayers to keep more of their own money.
But this argument against extending income tax credits to Americans with little or no tax liability does not work against extending income tax credits to Americans with another kind of tax liability -- payroll tax liability. Conservatives may argue that the untaxed poor don't deserve tax breaks -- but working-class Americans are taxpayers themselves. Conservatives cannot argue that Americans who pay payroll tax should be discriminated against in favor of Americans who pay income tax. Doing so would be political suicide.
In an ideal world, the Total Tax Credit would be refundable so that non-taxpayers among the working poor would get them, too, in the form of federal subsidies like the EITC. However, abandoning the goal of making the Total Tax Credit refundable to the non-tax-paying poor might be the price of a bipartisan coalition to enact this important reform.
Besides, Republicans who oppose the TTC will doubtless have it pointed out to them it was Newt Gingrich who in 1994 proposed making the child tax credit available to payroll tax payers -- a key element of the Total Tax Credit proposal. And it was Bush who in 2006 proposed capping "gold-plated" income tax expenditures, a precedent for another key element of the TTC system: capping "gold-plated" tax expenditures that benefit the affluent.
Nor would the TTC pit income tax payers against payroll tax payers. On the contrary, large numbers of income tax payers would be able to add their payroll tax to their income tax, against which they could claim bigger tax credits. Many in the upper-middle class as well the lower-middle and working classes would benefit from a Total Tax Credit law.
Making payroll tax payers eligible for all income tax credits is a big idea that can shake up the stagnant domestic policy debate. We've had three decades of income tax cuts for the elites; now it's time for payroll tax cuts for the masses. "Lift, cap, and share" should be the motto of proponents of the TTC system. Lift the cap on payroll taxation; cap all income tax expenditures; and share all existing income tax expenditures with Americans who pay payroll tax, even if they pay no income tax at all. If Democrats are shrewd enough to take up this cause, they could immunize themselves against conventional right-wing attacks. How could conservatives possibly object to cutting taxes and modifying existing programs to make them more fair? (There would still be the option of adding new tax credits in the future, like one to help people buy health insurance under an individual mandate system or to offset public health programs paid for by state taxes.)
It's time to share the credit -- the tax credit. The next president should work with Congress to ensure that all taxpayers get exactly the same tax breaks, whether they pay income tax on top of payroll tax or payroll tax alone. That's not only fair -- it's the American thing to do.