Failing Upwards: Why the argument about taxes punishing success doesn’t hold water

I, for one, am getting a little sick of the patronizing tone coming from rank and file republican representatives on tax issues.  A large majority of people in this country, including 2/3 of registered republicans, support higher taxes on top earners.  Corporate CEOs have lavishly excessive bonuses rained on them for developing new and innovative ways to avoid taxes on their companies.  There is very little debate outside of Washington that these things need to change. 

Income inequality is at or near an all time high in the U.S. and we currently rank 93rd out of 125 countries (and falling rapidly) in that tellingly bad metric.  Real wages for your average American worker haven’t increased in almost half a century while CEO income has increased 300% since 1990 alone.  CEO pay was roughly 50 times that of an average worker in 1985.  Today, it’s 350 times as much.  I don’t care how you slice it, it’s fairly clear that regular Americans are suffering under the weight of an increasingly top heavy economic system and things must change.

But to the GOP, any mention of taxing top earners and corporations falls under the banner of punishing success.  Well, it’s not success or the rewards of it that people want to punish.  Nobody was crying about the compensation Steve Jobs got from Apple.  He created a range of products that have benefited people in this country in a number of ways.  I’ll admit, I have issues with Apple shifting some of its high tech manufacturing facilities and skilled jobs to China for cheaper labor, but that’s another issue.  Jobs got paid for his leadership, and well he should.

The NBA is in a lockout right now.  Kobe Bryant of the Lakers is making $25 million per season.  Do you see anyone pointing a finger at Kobe’s exorbitant salary as the problem with the league?  No, because he’s worth every penny of it and then some.  Even Lakers owner Jerry Buss admitted he’s probably worth three times that.  Kobe got paid, as well he should.

The problem we have as Americans isn’t that we resent the successful.  We love the successful, America likes nothing more than a winner.  It’s that we resent the unsuccessful reaping similar rewards.  Gilbert Arenas of the Orlando Magic is getting paid enormous sums of money for being little more than a headache and a mediocre role player.  Kobe’s ultra-high salary isn’t a problem, Arenas’ is. 

Corporate CEOs all over this country are raking in obscene compensation packages for running their companies into the ground.  It’s not the Steve Jobs of the world we resent, it’s the failed leaders who cost tens of thousands of people’s jobs, who make decisions screwing over their employees for short term earnings gains that boost stock prices long enough for them to cash out the rich package of stock options they own with little regard to that company’s long term future, and no regard for their current employees. 

You want to know why CEO pay is 300 times greater in comparison to employee pay than it was just 25 years ago?  It’s because these top level, supposedly successful people the GOP protects have gamed the system for their benefit alone at all of our expense.  Many of these companies aren’t creating value with products or services that change the world, like Jobs did.  They’re playing numbers games to exponentially multiply capital in their own bank accounts on all of our dimes.

And once they cash out, often leaving their companies a mess, they gracefully glide out to pasture on golden parachutes while the now-jobless employees they left in their wake have only unemployment insurance to break their fall; a lead parachute with holes in it.  And not only does the GOP want to protect and defend the CEOs who cause this carnage, they want to gut what little assistance regular people have to keep their heads above water.  These kinds of CEOs are portrayed as successes and job creators (an indefensible oxymoron in far too many cases) and the employees they discarded are failures and deadbeats sucking unfairly on the public dime.

The financial sector spent the past 15 years raping and pillaging the American Dream.  They’ve virtually destroyed home ownership as part of the path to upward mobility, taking with it the majority of net worth most Americans had accumulated.  Worse yet, they packed bad loans into bogus securities and sold them to pension plans, taking away the retirement savings of millions.  And what did we do to punish this?  We invented new and interesting ways to bail out these essentially criminal enterprises, allowing them to quickly dump losses from their scams on taxpayers, reap massive profits and some of the same CEOs who presided over the fraud in the first place are again receiving bonuses that should make even the wealthiest of us blush with shame.  The GOP wants to protect these “success stories” who stole so much from so many, and for the rest of us who lost our homes, the equity in them and our retirement savings?  Well, they wanna gut Social Security, too.

Here’s an example of what I’m talking about.  Gannett CEO Craig Debow presided over some serious declines in his five years at the head of the giant media company.  During his tenure, 20,000 Gannett employees lost their jobs, annual revenue dropped by $2 billion and the stock price fell from $72 per share to $10.  By no criteria that makes any rational sense can Debow’s tenure be deemed a success.  It is, in fact, a failure of epic proportions.  What kind of parting gift does he get for this far-less-than-stellar performance?  A compensation package of $37 million!  He also gets a free office, free secretary, lifetime health benefits and some other assorted goodies.  Let me reiterate–miserable failure yet walks away with $37 million and then some.  Meanwhile, the company is in shambles and 20,000 people lost their jobs.

Again, why does the GOP want to protect this kind of guy and portray his actions as successful when it’s clearly anything but?  No, we as Americans don’t want to punish success.  We have no problem with rewarding  success and honoring the successful.  We, however, have a very big problem with rewarding failure and redefining it as success.  Especially when that faux-success comes attached with tens of thousands of people out of work and billions of dollars lost.

And lest anyone thinks I’m politically slanted, the Democrats protect the very same people.  There is little difference between the parties in this respect.  The reason I chose to use GOP throughout this is because they are most outwardly vocal about it.  They are the ones unapologetically throwing this rhetoric out there, and fronting this bogus premise of defending the rich as successful is also defending us all.  Neither party has the high ground here, they’re both equally rotten, but the GOP makes the most noise about it.  That’s why I called them out specifically.

(Hack!) Obama Administration (Hack! Hack!) Bails On Stronger (Hack!) EPA Smog Regs

Just a short comment on this because, frankly, what more really needs to be said?  The President, who I’m told is a Democrat although you sure as hell can’t convince me of that by looking at anything he’s actually done, pushed back stricter EPA standards on smog-causing ground level ozone until 2013 at the earliest.

Now, at best, this is simply a political decision to take a potentially contentious issue off the table for next year’s reelection campaign.  But it still reeks of yet another in a long, seemingly never-ending line of capitulations to the right wing.  Someone really does have to explain to me why the hardline rightwingers still hate this guy, and still toss around terms like Marxist and socialist in reference to him.  This guy’s been more effectively hardline republican than W. Bush was.  There is nothing even remotely socialist in his policies.  He’s given the right side of the aisle virtually every last desire they could have possibly hoped for while giving his own supporters little more than lip service and the middle finger.

This latest decision is, quite simply, a disgrace.  Let’s forget for a moment that affected parties would have 20 years–two decades, for god’s sake!–to come in line with these standards before any possible penalties would kick in.  That fact, in and of itself, makes the cries of wholesale job destruction and economic catastrophe opposing these regs seem exactly like what they are, petulent whining from polluters who would prefer not to actually have any kind of conscience or clean up after themselves.

It also illustrates rather eloquently how little backbone our Commander-In-Chief possesses.  A thoroughly expected bad jobs report and he instantly caves on a very serious and crucial environmental issue for what reason, exactly?  Does he think that the GOP will be persuaded to back his jobs proposals because he threw them this bone?  Fat chance!  Hell, he’s got nothing but back handed complements for this decision, even though it’s precisely the kind of backwards thinking garbage the GOP gets all heated up over these days.

All it will do is further alienate his base of support.  Either Obama is arrogant enough to assume they’ll support him next year no matter how counter his actions run to their wishes, or he just sucks at this job.  I think it’s both.

In reality, he’s right, his base of support won’t vote GOP under any circumstances.  What they will do, however, is stay the hell home on election day and not vote for anybody.  With the republicans looking like they’ll be going either with a fringe whackjob like Rick Perry or a blatant corporate stooge like Mitt Romney running against the most disappointing letdown of a President in my lifetime, if not ever, I’m going to go out on a limb and make an election day 2012 prediction.

Next November will be a record setting vote.  We will see the lowest voter turnout in history, percentage wise if not in total numbers.  After all, who besides the most blinded partisans will be able to ignore the obvious reality of pathetic-ness on both sides and get excited about any of these choices? 

Please, please, please, isn’t there one good legitimate leader anywhere in this damned country?  Because there sure as hell aren’t any in our current array of somewhat worse than awful choices.

Government Fail! Given that the status quo sucks, could default be the difficult path to reclaiming this country for the people again?

So we’re two weeks away from the end of life as we know it, or so we’re being told, if the U.S. doesn’t borrow more money to make payments on existing debt.  Kind of a hollow arguement, if you ask me.  Just the fact that we have to borrow to pay off debt is a pretty bad sign to begin with, but it’s government, they always run in the red, and in a lot of ways, they’re designed to do exactly that.

You can’t afford to have government handcuffed by something like, say, a balanced budget amendment or else the future of national politics will be nothing but discussions of massive cuts to actually effective programs, or things we actually need, like a useful military.

But that’s where we are in politics today.  It’s pretty apparent that cuts to major, essential entitlements that provide the safety net for so many low income people, especially now when we find ourselves in the exact kind of economic crisis that these programs were designed to protect people from, is a pretty ballsy and, well, flat out stupid thing to do.

Of course, it’s also pretty stupid to watch, in no uncertain terms, the vast majority of the wealth and resources in this country go to the tiny, tiny minority at the top of the ladder and do nothing about it.  The financial and corporate sectors are a cesspool of greed and corruption, but we can’t even pass reasonable regulations that could even make a dent.  And you can forget any actual fairness in taxing the bastards.  That’s off the table.  They’re job creators, after all, even though not a one of these companies turning very, very nice profits of late, despite the crushing recession, is doing anything but shedding jobs, and outsourcing whatever they can to further prop up the stock price and generate even more money out of relative thin air.

We still subsidize the oil industry to the tune of billions of dollars each year.  The oil industry has spent the past five years cranking out quarter after quarter of obscene record profits.  Ever since energy prices spiked in 2006-07, you know, what actually caused the recession, a price spike created practically out of nothing by speculators.

Sure, the mortgage bubble is widely seen as the cause, but people didn’t really have trouble paying their bills before energy costs went nuts.  After that, the credit system we’ve constructed that has self-serving severe and almost immediate penalties for even one late payment kicked in, and interest rate hikes caused everyone’s debt to jump and took what could have been a small slow down and turned it into an insurmountable crisis. 

My problem with credit policies is that there’s no buffer zone.  Everyone has problems from time to time.  A legit default is one thing, where you don’t pay your bills at all for months, but a payment a few days late on occasion doesn’t mean anything of the sort, yet we still get mightily penalized.  Pay your credit card bill on time every month for 10 years, and you get little benefit other than the same continued relationship, if you’re lucky. Pay it a few days late one month, and bam, your interest just jumped to 23% and you may never be able to bring it back down, even making every payment for the next 10 years on time.  It’s a system set up to be totally unforgiving to the borrower, and it knows that, odds are, 99% of borrowers will have a money squeeze at one time or another.   It’s rigged against us.  It would be interesting to see, of all the money currently owed in the world, how much of it is rapidly accruing interest at usury type rates.  I’d bet it’s well over half, maybe more.  Of course, that’s what we get in an economic system based on multiplying capital on paper with a total disconnect from reality. 

We live in a consumer-based culture.  We produce goods, offer services and purchase those goods and pay for those services.  The problem is, our economy has become financial-market-centric.  Fortunes are no longer made selling goods, but in speculating, stock prices and an increasingly complicated array of shorts, derivitives, and various other financial “products” that make money out of nothing tangible.  There is an almost total disconnect between the financial sector and people’s actual lives.  I certainly would like an explanation from a genuine economist about how a consumption economy is supposed to survive when all the resources go to the corporations and banks.  I read the other day that 80% of the economic growth in this country in the past quarter century benefitted only the top 2% of earners.  So 2% control 4/5 of the resources while 98% control only 1/5.  That’s not a free market economy, that’s a feudal system.  Want another telling stat?  The 400 wealthiest Americans combined own more than the lowest 150 million!  400 people have sucked up  more resources than half of our population. 

All of this makes me wonder how and why anyone who isn’t at the top of one of these banks or corporations or isn’t already insanely wealthy would vote Republican.  It’s clearly not in anyone’s best interest.  (Of course, voting Democrat isn’t in anyone’s best interest, either, but that’s a different arguement.)  After gaining more power in the last election cycle, the GOP has engaged in an all out war against the most helpless and downtrodden in this recession scarred country. 

The hypocritical, religion based attacks on Planned Parenthood around the country that effectively takes low cost health services away from millions of women based on a tenuous and intellectually dishonest connection to abortions is disgraceful and, quite frankly, very un-Christian.  It seems too easy for these political preachers (that’s what they are, after all) to quote scripture and verse while wiping out assistance for the poor, and demonizing homosexuals and the like.  But it seems to me that the Bible pretty clearly and more explicitly demonizes the money lenders and money changers as being outright evil.  Where’s that biblical sentiment for that in the conservative, god-fearing GOP?  Isn’t standing up for the banks, for Wall Street and corporate excess a very un-Christian thing to do as well?  You’ll kill health services for the poorest of the poor, praising god all the way, but you’ll allow high finance to rape and pillage entire nations and act like it’s the height of offense to even suggest regulating them in the slightest.  Well, I guess so long as your campaign collection plates are full, it’s all good.  And here I thought greed was one of the seven deadly sins.  I guess I missed the new testament book of Gordon Gekko where greed became a virtue.

But what do we, the people do about this?  Vote?  Ha!  Let’s take the plight of the truly independent voter, the central voting bloc that routinely swings elections in the favor of one party or the other.  We’d had enough of the GOP after eight catastrophic years of George W. Bush, so we lined up behind the Democrats and Barack Obama’s hope and change platform.  Well the glow fell off that rose pretty quickly as Obama showed himself to be a republican in progressive’s clothing.  His slogan should have been hope for change, as in vote for me and you can hope things will change.  They won’t, of course, but at least you can hope.

So, we swung back the other direction in the mid-term elections, giving the GOP another go.  Well, now we’re paying for that with soon-to-be massive cuts to entitlements and services for the poorest of the poor, the very people our economy hasn’t just failed, but exploited to the point of bringing the entire global economy crashing down around us.  And a blatantly self serving no taxes at all platform that is as economically foolish as it is amazingly unjust.  And if you’re watching, some of them are now trying to attack the minimum wage and overtime statutes.  Real wages are already falling, for those who still have jobs, so sure, let’s pass some rules that make it even easier for employers to screw us all.  That’s good policy. 

So where do we independents go from here?  Do we vote Obama and the democrats again, and hope even more foolishly that there might actually be some change coming along?  Do we stick with the GOP and watch them further pave the way for the very rich to get even richer, and continue to cut essential entitlements that, you know, provide health care, food, shelter and other kinda important things for people with few, if any options?  And all the while, playing a game of misdirection with religion and values?

If you happen to be against abortion or gay marriage, these guys and gals seem like your kind of folks, but don’t believe it.  They’re waving their right hand around attracting your eye while raving about moral decay, and with their hidden left hand, they’re stealing your wallet and draining your bank account.  These people aren’t really moral champions, they’re crooks enflaming your beliefs and prejudices to distract you from the actual agenda.  Continue to support these folks and you’ll soon find yourself broke, too. Only by then, there won’t be any safety net for you when you need it because they wiped it out while you were busy cheering their anti-abortion rhetoric. 

We don’t really have any options.  Are there no more real leaders in this country?  Where are the men and women of vision hiding out when we need them most, because they sure as hell aren’t in politics?  It’s a depressing truism of today’s world that says if you can get elected, you can’t do the job, but if you can do the job, you can’t get elected.

It should be painfully obvious that our two party system has failed us all, and we’ll be reminded of that again in a few weeks.  We’ll get a deal to raise the debt ceiling, I’m sure.  And it will be trillions in cuts from entitlements, nothing else.  And the GOP will laugh all the way to the bank, quite literally, and Obama will call it a success for having avoided the catastrophe of a default, even if it ultimately is little more than yet another sell out of all of us in favor of the bankers.

At this point, it’s clear that there is no taste in government for reigning in an out of control and much too powerful corporate/financial sector.  We’re being warned that no debt ceiling deal means default and default means an economic hit that could bring financial institutions to their knees.  Well, maybe that’s what we need to happen, then.  Government isn’t going to do it on purpose, so maybe their petty infighting and self serving greed will do it for us, creating a crisis that brings these institutions down, wiping out a goodly portion of the imaginary capital that Wall Street spends its days generating.  That may be the most fitting conclusion to this mess after all.

To be certain, there will be harmful consequences for us all in a default situation.  But, given the direction of things, those harmful effects are coming anyway.  Is it better for the average person to wait around while the financial elite suck up more and more of the world’s resources, leaving them with vast stockpiles of cash and the power that goes with it when the house of cards we’re all living under finally falls on us?  Or would it be better to have an immediate crisis that wipes out bunches of those resources from the same financial elite, and effectively levels the playing field for a much needed economic restructuring?  When the financial sector no longer has the resources to buy up every politician on both sides of the aisle, can we then have some legitimate hope of a return to goverment that actually puts the people first as opposed to what we have now, a government of the elites, bought by the elites, for the elites and the people are little more than assets to be exploited?

I don’t know the answers to those questions, but what I do know is that if we continue on our current path, we’re doomed anyway.  Maybe default, as difficult as it would be in the short term, isn’t so bad in the long run.  After all, you can’t build that fancy, new, stronger house until the old, crumbling one is bulldozed away. 

All we need is the bulldozer.