GOODBYE, GOP
By James N. Sites

If Republican members of Congress think that their adamant refusal to consider tax changes as part of a Federal budget/debt agreement is going to win them votes in the next election, they had better think again. The same for members of the Congressional Tea Party caucus.

I for one will NOT be voting for GOP candidates next time around. Nor will my friends or family. In fact, I’ll shortly be changing my voting registration in my home state of Delaware. I’ve had it, GOP!

Why? Because the Republicans seem totally oblivious to the radical changes occurring in the US economy and their implications for America’s future. Or are they PURPOSELY blind in their fervor to curry favor with their wealthy backers and major contributors to re-election campaigns? Whatever, they seem woefully unaware of the nation’s most serious problem short of fighting international terrorism:

This is the increasingly dangerous concentration of wealth in the hands of a fraction of 1% of the population.

The radical changes that have brought this about include (1) runaway executive compensation among US business firms; (2) bloated bonuses within the financial sector and (3) the Bush-Cheney tax cuts of 2001-3, which heavily favored the wealthy and led to a decade of disastrous budget deficits and spiraling national debt.

If a fair and equitable tax system should “follow the money,” then higher tax rates not only should be applied to concentrated wealth; they MUST be so applied if the US enterprise economy is to survive. Mass purchasing power is essential for the effective functioning of our economy. If the wealthy continue grabbing most of the benefits of economic activity, where is the general public’s purchasing power to come from? Certainly NOT from the 20 million Americans trying desperately to find jobs. And NOT from the millions of others who are working at subsistence-level wages.

Indeed, the USA is looking more and more like a classic Banana Republic, with a few at the top wallowing in luxury while everyone else is either falling behind or is left barely hanging on.

Under the new economic reality America faces – where the vaunted marketplace has badly failed to control greed at the top and achieve a fair distribution of income, key tax changes are badly needed:

1. End indefensible loopholes and tax breaks for special interests and allow the IRS rate on that portion of a person’s taxable income exceeding, say, $300,000 annually to return from the present 35% to the pre-Bush level of 39.6%. The present 15% giveaway tax rate on dividends should also return to 39.6%.

2. Enact a new top marginal tax of 49.6% on that portion of a person’s taxable income exceeding $1 million a year…with ALL of the additional money raised by this tax then devoted to CUTTING taxes for those making less than $100,000. per year.

These tax actions, implemented immediately, would not only correct today’s badly unbalanced distribution of tax burdens but they would also stimulate consumer spending and employment AND the flow of general tax revenues needed to start bringing down the government’s huge budget deficits. They would also help rein in on the runaway pay and bloated bonuses of corporate CEOs, returning some of the vast sums they are now plundering from their firms to use by the general public.

As for the strange controversy over when and how to act on our deficits, there IS a practical, workable approach. Unemployment is the key. Deficit spending may be needed now to stimulate economic activity…but once the national unemployment rate drops below 6%, the public should DEMAND that Congress and the President pass balanced budgets. This must include an extra 5% over and above the annual operating budget directed solely and directly to paying down our horrendous backlog of debt. This action formula can be expressed in this simplified equation:

Minus 6% = Balance Plus 5%.

It CAN be done, Washington. DO it…or face the public’s wrath at the next election. People are FED UP!
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