Monday, July 11, 2011

The Top Five Things Conservatives Say That Piss Me Off- Part Three

Thus far, I’ve covered conservative complaints about the number of people who pay income tax, as well as conservative protestations that rich people create jobs. As many non-conservatives have probably noticed, you can’t get very far into a debate with a conservative on either of these topics without being called that most dreaded of all epithets…that’s right, you must be a socialist. Interestingly, this one doesn’t even piss me off anymore. I just don’t mind being called a socialist by a person who uses the term “socialist” interchangeably with “communist,” “fascist,” “liberal,” and “person I don’t like very much.” There is, however, one conservative complaint about the dreaded socialists that does get under my skin. Let’s talk about that today, shall we?


#3- “Socialism means from each according to their ability to each according to their need

Well, to begin with, let’s take a look at the origins of this statement. While it is commonly attributed to Karl Marx, which would make it a statement about communism, not socialism per se, the slogan itself predated Marx’s published use of it. In other words, it is not necessarily dishonest to use this quote and represent it as being about socialism. Socialism has meant many things to many people. Marx himself used socialism to represent an imperfect application of communism, a time when income would be distributed according to work, not need. The USSR followed this model, and would therefore have been considered a socialist nation by Marx, not a communist one. Marx used the “from each according to his ability to each according to his need” model to describe a perfect communistic society, not an imperfect socialistic one (Marx also knew how to make his subjects agree with his verbs, but neglected to use non-gender-specific language). Therefore, if a person identifies this as a Marx quote and goes on to link it to socialism, that would be misleading, whether intentionally or not. However, you won’t usually see this done. Why not?


Because most conservatives haven’t read Karl Marx, of course. They know the quote, instead, from their goddess Ayn Rand. This characterization of communism features heavily in Atlas Shrugged, and the connection to Rand alone is enough to get under my skin. Frequently, the person doing the quoting won’t even have bothered reading the actual novel. It, like the Bible, is so long and mostly boring that few of its adherents have actually read the whole thing. They’ll have read the “Tramp’s Speech” excerpted, or know someone who has, or have had it summed up for them in some other form. I’ll do so for you now, to spare you from having to read the thing yourself: A guy worked for a factory that used the slogan being discussed as its sole law. The hardworking, productive men devolved within just a few years into craven creatures, competing to be seen as the least competent and most needy in order to benefit the most from the system. Oh, what a terrible thing communism is. There’s also a part about punching the teeth out of an eight-year-old girl.


How could I possibly argue with that? Socialism is not only economically unfeasible, but also it makes people punch little girls. This has been incontrovertibly proven by the power of parable. Well, let’s just take one moment to look non-hysterically at the words themselves, think about what they mean, and then compare that to what conservatives say they mean. Let’s start with that first part, “from each according to his ability.” The words that are actually there would seem to suggest that each and every person in a given society would be expected to contribute, and that they should do so based on their own ability. What exactly would be the problem with this? If everyone were actually contributing based on ability, we could have zero unemployment, right? Without the process of having to wait for a person with resources to figure out that there is a need in society great enough to warrant sharing their resources in the hopes of getting back even more resources, a person could simply go do some productive work. No one would be exempt from the expectation that they should be working. No one would get to spend their whole life sitting on a couch watching Springer and pulling an SSI check, because some productive contribution could be found for them to make. Likewise, no one would get to spend an entire life sitting by a gold-plated pool enjoying the fruits of their ancestor’s spoils, because a contribution would be expected from them as well, and not one based on how expensive a college their parent was able to legacy them into. If Jr. is just plain dumb, he can do work appropriate for a dumb kid. Sounds nice, but kind of unfeasible, right? Hold that thought.


Let’s look at the second part of the quote, “to each according to his need.” This is the sticking point for a lot of people. It seems more possible, if not likely, that we could figure out what each person’s ability is and put them to work. How, though, do we figure out everyone’s individual need? Certainly, there are many things in my life that I enjoy but do not strictly “need.” I can think of hot fudge, science fiction television, and ceiling fans right off the bat. Why does socialism want to take those things away from me? For a moment, though, let’s stop overthinking this thing and making it about ourselves. In light of the first part of the slogan, we can imagine that we are living in a world where each and every adult is working productively for as many hours as their health will allow, up to forty. Should any person, who is contributing all they can towards a productive society, not be able to have a dry place to sleep? Food for their family? Medical care for themselves and their children? At a very basic level, is there a problem with thinking that a person who spends half their waking hours doing work that society needs done is entitled to having their basic needs covered? Or, on the other hand, are we comfortable with saying that although we all like mushrooms and will always need people to farm them, we want the people who do that work to never be able to treat their cancer, because they just aren’t valuable enough?


Now, the interesting thing about this slogan is that even conservatives will rarely disagree directly with either part. They won’t say that some people shouldn’t have to work to their ability, or that some people shouldn’t have their needs met, even if they are productive and hard-working. They may believe these things, but they usually don’t say them. They will say, instead, that this is a lovely idea, but that it will never work because people are too evil. No matter what, they tell us, the utopian ideal will be undone by people who will try to cheat the system. They will pretend to be unfit so we won’t work them as hard, and they will pretend to need more than they really do to get more than their fair share of other people’s toil. Is this a huge surprise? Of course not. Every ideal is corrupted and perverted by humans, including their own ideal of capitalism. Utopian ideals seem unfeasible precisely because they are idealistic. Yet, in their ideal conception, capitalism works like Little House on the Prairie, with each person working directly for the benefit of their family, providing for all of their own needs and trading as necessary in a mutually beneficial fashion, and this seems feasible somehow. In reality, capitalism has resulted in such lovely concepts as slavery, child factory workers, sweatshops, and blood diamonds. Yet, conservatives want to be able to compare the Little House version of capitalism with the worst possible corrupted version of socialism, and then act as if Medicare will have America turning into a communist wasteland. There is no simple solution to all of society’s problems. Certainly, pure socialism is not the answer, but neither is pure capitalism. Both systems, left unchecked, allow one group of people to corrupt and subvert the system to their own benefit and the detriment of everyone else. However, the next time someone uses this quote and then jumps right into the Ayn Rand worst case scenario, I’m going to stop and ask them which it is. Do they think they shouldn’t have to work, or do they think someone else who worked shouldn’t get to eat?

Thursday, July 7, 2011

The Top Five Things Conservatives Say That Piss Me Off- Part Two

Yesterday I talked about how much it pisses me off when conservatives complain that only 47% of Americans pay income tax. For some reason, they’re always complaining about how the poor and destitute aren’t paying their fair share, instead of wondering why there are rich people who don’t pay any share. I promised that today I would discuss why their reasoning for this willful blind spot also pisses me off. So here we go—


#4- “The rich create jobs”

When I hear someone say this, it makes me want to smack them upside the head. I promise that I’m not a violent person by nature, but this one really pushes my buttons. Unlike yesterday’s post, where I admitted that the statistic is true, it’s just the way conservatives use it that’s anger-invoking, this time I’m going to go ahead and call them liars. Now, to be clear, not everyone who says this is lying…on purpose. There are people who know this statement is false, and use it to promote their own self-interest. That, of course, would be the rich people who want everyone to believe that we need them. Even though I know they are lying liars when they say this, I can at least understand why they do. However, when I hear someone toss this out as the reason why rich people shouldn’t have to pay more tax, about nine times out of ten it’s a working class joe who is working against their own self-interest because the rich have been so damn convincing with this one.


Now, far be it from me to accuse someone of lying without providing some evidence. I’m a liberal, after all, and my world is fact-based, not faith-based. Let’s think for a moment what the world would look like if it were true that rich people create jobs, and furthermore that they are more likely to do so if they are allowed to “keep more of their own money,” also known as not paying the taxes the rest of us have to pay. To begin with, I would hypothesize that if these two things were true, the number of jobs in America would go up, and the unemployment rate would go down, any time one of two things happened. First, if rich people create jobs, then any time rich people got richer, I would expect them to create more jobs. Second, if they are more likely to do so when they pay less lax, I would expect to see unemployment fall when rich people pay less tax. Now, let’s look at the real world. First, have rich people gotten richer or poorer in the past twenty or thirty years? Well over a third of all income growth went to the top 1% of the population between 1979-2007. (source) What does this mean? Well, to begin with, that top 1% of earners now makes 24% of all income in the United States, compared to 9% in 1979. (source) Now, I’m willing to grant that while the top 1% has statistically gotten richer, that does not mean that we’re talking about the same people getting richer over time. People do fall out of this group or rise into it. However, the fact remains that there is a group of people at the top who are richer, compared to the rest of us, than rich people have ever been before.


And the taxes they’re paying? Much is made of the fact that the amount of tax paid by the top 1% is growing as a percentage of all tax paid, to imply that their tax burden is heavier than anyone else’s. This is simply explained when you look at the income growth data. The top 1% now takes in so much of the income that the rest of the population has less and less available to contribute each year. But let’s look at the actual tax rates paid by the superwealthy. From 1940 to 1963, America’s glory years for many conservatives, the top tax rate varied, but never fell below 81%. It rose as high as 92% in 1952-53. From 1964-1980, it ranged between 70% to 77%. (tax rate source) What did unemployment look like during these years? From 1948-1963 unemployment varied from a low of 2.9 in 1953 (a year the tax rate was at its highest) to a high of 6.8 in 1958 (when taxes had gone from 92% to 91% in the top bracket). Unemployment never went above 7% until 1975, when the highest tax rate had fallen to 70%. (unemployment rate source) In 1982, unemployment had climbed to 9.7%, and the highest tax rate was slashed to 50%, thanks to Reaganomics. In 1983, unemployment fell to 9.6%, and continued to fall until 1989, when it hit a low of 5.3%. 1988-89 was also the all-time low tax rate for the top bracket, at 28%. Since then, taxes rose to a high of 39.6% for America’s richest from 1993-2000, a period when unemployment dropped each year from 6.9% to 4%. The top tax rate has since fallen to a low of 35% since 2004, and our unemployment rate has, as we all know, risen to the highest levels since the depression. What does this say about tax rates and job creation? It’s a complicated story, and there are economists on both sides with compelling data. It seems pretty clear, though, that rich people were actually creating more jobs in the fifties, when the highest tax rate was over 90%, than they are now, when they are only paying, at the most, 35%. If rich people create jobs, and they do it most when their taxes are low, then they should be creating jobs right now like crazy, since they’re richer than ever and paying pretty close to the lowest taxes of modern times. This must mean that rich people don’t create jobs, despite all the PR to the contrary. So what does create jobs?


To answer this question, let’s think about a business owner. Let’s make him the owner of a large car dealership. Let’s make him a millionaire, too, and a fiscally responsible man. Let’s assume that business is terrible right now, as it is for many business owners all over the country. No one is coming in to buy any cars, and he is struggling, although thanks to his savings he is still doing well personally. Now let’s imagine that the government gives him and his business a tax break, whether through a lower rate, a special subsidy, or a new tax exemption, which allows his business to effectively take in $120K more than he expected. What should he do with this money? Should he hire a new worker or two, or expand his inventory? Of course not, since we’ve established that he’s not an idiot. Why would he hire new employees to stand around his empty showroom? Why would he increase his inventory if he’s already not selling the cars he’s got? He’s going to put that money in savings and wait for the economy to turn around. He may invest it, but he may need liquidity right now. Rich people don’t create jobs, no matter how rich we make them. What would make this business owner hire some new workers? Demand for new cars that is so great he can’t handle it with his existing work staff. If so many people are coming in to buy cars that some of them are walking away before his salespeople can make a pitch, then a smart businessman will hire a few more salespeople. It may be the millionaire doing the hiring and signing the paycheck, but it’s demand that creates jobs. I will say this one more time, in case anyone missed the anger the first time. Rich people do not create jobs; demand creates jobs. Please, everyone in the working class, stop thinking that being nice to rich people will make them like you more and let you in their club. Billionaires can take care of themselves, and they don’t need you to negotiate a lower tax rate for them, although I’m sure they will laugh all the way to the bank with the money they won’t be using to create new jobs.

Wednesday, July 6, 2011

The Top Five Things Conservatives Say That Piss Me Off- Part One

I was going to make a blog post with a list of the five things conservatives say in comments sections and letters to the editor that really set my teeth on edge, but once I started ranting I couldn’t hold myself back. Instead, I’m going to make this a series. I know it looks like a countdown, but these things are really in no particular order, since they all piss me off about equally.


#5- “Half of the people in America don’t pay income tax”

This one isn’t even a lie. It is true that about 47% of Americans were projected to pay no income tax in 2009, according to the Tax Policy Center. The problem with this statement is that it is usually used in a misleading way to back up their further claim that there is a freeloader class in America. And there are two reasons why this statistic does not prove that, because there are two reasons why a person would not pay any income tax in America. First, there are the people whose income is too low to pay income tax. There is technically no income too low to pay taxes, but anyone who makes less than the standard deduction would in effect owe no tax without anything else coming into play. For 2011, that would be a single person making less than $5,800, and for a married couple filing jointly, that would be $11,600. I’m really not sure what blood conservatives expect to squeeze out of that particular stone. If 47% of Americans were falling below that income level, then a better question would be—why are so many Americans so damn poor? If I came across someone who was trying to survive on less than six thousand dollars a year, my instinct would be to try to help that person, not to demand they pay more of their “fair share”. Certainly, I would not assume that they are receiving all the same benefits I am from the tax dollar pot. For example, a person living in poverty that extreme probably isn’t driving, so why should they have to pay to pave the roads for those more fortunate? If this person is receiving any form of government assistance, I would certainly not hold it against them. For many people, though, those benefits are an example of how “some people pay into the pot, and some people only take out.” This brings us to the second group of people who pay no tax.


Again, there are people who pay no income tax simply because their income is too low. That number could not possibly be 47% of our population, so what else is going on here? Well, there are the people who pay no tax because they get enough credits, exemptions, and deductions to drop their tax liability to zero.(source) On the normal end of that spectrum, you would have a family of four with two children under 17. As long as their income is below 50K, they pay no tax, thanks to deductions, child credits, etc. This means that many of the same people who are complaining about people not paying taxes are probably not paying taxes, either. Sure, there are taxes that are deducted from their paycheck each week, but they get the whole thing back in April. Granted, they don’t get paid any interest on the loan they gave the government, so that could be considered a cost, if they had been planning on investing that money. However, how many struggling families of four do you know who invest a significant portion of their income? Not many, since they need just about every two cents they can scrape together just to get by. Again, I don’t begrudge those families anything, (disclosure-for most of my adult life, I was one of those families) because they just don’t have much else to give. They are doing the job of raising the next generation of Americans, and it’s a pretty tough job in this economy. Additionally, most of these families, while they are not paying income tax, are not taking much else “out of the pot.” Some of them may qualify for free health care for their children, but not for themselves. Some may get WIC benefits when they are pregnant or have small children. However, many families making incomes in the range hovering just under 50K do not qualify for most government assistance, and could hardly be called “freeloaders”.


So, is this it? Does this cover the entire 47% of Americans who don’t pay income tax? Really poor people and struggling lower-middle class families? Nope. As an aside, I’d like to remind everyone that even these people I’ve mentioned don’t pay zero tax. There are still Social Security and Medicare taxes, excise taxes, sales tax, property tax, etc. No one escapes paying taxes in America. However, there is a group that certainly tries. Back in 2005, there were 7,385 tax returns with income over $200K that reported no federal income tax liability.(source) This is only the people who used charitable donations, tax paid overseas, etc. to reduce their tax liability. It is not even counting all of the people who use “losses” from one business venture to offset their “returns” from another. That’s right, folks, there are literally thousands of rich people who pay no income tax. They have luxury cars, yachts, and nice big homes, but don’t pay anything into the pot. They only take out, in the form of farm subsidies, subsidies to oil companies, and other nifty government programs. That means that those of us in the middle class are really paying welfare to two groups of people—those who are less fortunate, and those who are much, much more fortunate. Michelle Bachman, for example, famously received 50K in farm subsidies in 2008 for her $250K stake in her father-in-law’s farm.(source) This means that she received more in other people’s tax dollars that year than many of the so called “freeloaders” made, period. Yet, for some reason, this doesn’t piss conservatives off. It’s terrible when poor people, who don’t have any money to begin with, don’t pay taxes or (God forbid) receive benefits from the government, but it’s okay for rich people, who have the money lying around in fancy Ming vases, to not pay any taxes, or even to take more out of the tax dollar pot than they put in. Why do they have this strange standard for who should pay taxes? Stay tuned tomorrow for “Rich people create jobs.”