During a recent appearance on Meet the Press, House Speaker John Boehner offered up a pithy, two-word justification for draconian budget cuts: “We’re broke,” he intoned. This week, on Morning Joe, Wisconsin Gov. Scott Walker invoked the same b-word as a pretext for his jihad against unions: “I’m not going to negotiate the budget. We’re broke.”
No serious person disputes that public debt and the deficit are massive issues that demand comprehensive solutions and tough choices. But are we really broke? Depends on who you mean by “we,” pilgrim.
[Read the U.S. News debate: Should public unions keep collective bargaining rights?]
If you’re talking about our government and our public institutions, yep, those are broke. Our schools are broke. Our roads and bridges are broke. Our energy grid is broke. Our social safety net is broke. Grover Norquist’s infamous, prurient fantasy about cutting government “to the size we can drown it in the bathtub” is dangerously close to being realized. The GOP is using the economic collapse (caused by their policies) as a pretext to push “limited government” to a slashed and burned extreme. “Everything is on the table,” they shout.
Actually, not everything is.
During that same Morning Joe appearance, Walker was asked whether it would be appropriate to ask the wealthy and corporations to share in the sacrifices needed to get our fiscal house in order. First, he dodged. Then Walker did Boehner and Senate GOP Leader Mitch McConnell proud and categorically ruled out any tax increase, even on the wealthy.
Aye, there’s the rub. “We have a spending problem,” they scream. In some senses, yes, but we do also have a revenue problem, and no matter what the deficit commission and wealthy pundits like Joe Scarborough and George Will say, the American people will not accept massive cuts in Social Security, Medicare, education, and other government programs that benefit the middle class without a real conversation about what the wealthy and corporations should pay. Voters have said as much in poll in after poll. But that’s not a conversation the GOP wants to have (the Koch brothers would disapprove). [See a roundup of editorial cartoons about the GOP.]
Which brings us back to “broke.” America isn’t broke. There are almost 8 million millionaires in the United States. Since 2000, the wealthiest 1 percent has gotten wealthier while its tax bill has gotten ever smaller. And corporations? 2010 was an all-time record year for corporate profits. While Americans tightened belts, Wall Street gorged on enormous bonuses.
How about taxes? Well, the overall tax burden is the lowest it’s been since 1950. The Government Accountability Office reported that more than half of foreign companies and about 42 percent of U.S. companies paid no income taxes for two or more years between 1998 and 2005 (the last year for which such statistics are available; the tax burden has decreased since then). About 25 percent of the largest U.S. companies paid no federal income taxes in 2005 despite $1.1 trillion in gross sales that year. Fully two-thirds of companies in Wisconsin pay no state income tax. [See photos from the Wisconsin protests.]
So before we ask a teacher or a social worker to take a benefits cut and give up collective bargaining rights, before we gut Social Security and Medicare, shortchange our schools and transportation network or cede the clean energy future to China, shouldn’t we ask millionaires and Exxon to pay a little more, say, as much as they did during the Reagan or Clinton years, when rates were higher?
Shouldn’t we, as the Center of American Progress suggests, close corporate loopholes and at least consider levying a modest financial transactions tax on trades of stocks, bonds and derivatives?
Hey, everything should be on the table, right?
To be clear, this isn’t a plea for altruism; it’s a demand for fairness. After all, the wealthy and large corporations get a pretty substantial return on their relatively minimal investment of tax dollars. Their overseas investments are secured by our massive military. Their employees are educated by public schools and universities, and, all too often, provided with health coverage by Medicaid, S-CHIP, and public hospitals. They drive their cars on roads built, maintained, and largely funded by regressive taxes. They keep their money in banks bailed out by taxpayers. They owe their Uncle Sam. [See a slide show of 10 budget and spending fights looming for Obama and the GOP.]
Because if you’re scared of going “broke,” watch what happens if we fail to make public investments that drive economic growth and create wealth for all Americans. That’s how we end up broke. In an era of shared sacrifice, the wealthiest Americans and large corporations cannot simply opt out, and if Republicans don’t like that ... so be it.
- See a roundup of editorial cartoons about the economy.
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- See editorial cartoons about the Tea Party.
Reader Comments Read all comments (17)
Greg Harman of LA 4:17PM July 28, 2011
PJ of OH 4:06PM February 25, 2011
JIm in Seattle of WA 11:38AM February 25, 2011