There are moments in history where we collectively choose the kind of nation we want to be. This is one of those moments.
Over the past decade, the American Dream has eroded as the gulf between the haves and the have nots has yawned ridiculously wide and threatened to swallow us whole. Today, 400 people control more wealth and assets than the bottom 1.5 million people combined. That’s not simply because those 400 people worked harder or invested better but, in large part, because our economy and political system has been rigged to their advantage.
And so it is that while the majority of us faced with stagnant wages as rising gas prices gobble up what’s left of our income, those 400 people at the top of our economy ladder are paying lower taxes than ever. While the official top tax bracket is already an historically low 36% (which applies only to those dollars earned above the $250,000 threshold), according to the Associated Press, the real tax rate paid by the richest 400 people in the United States this year is approximately 17%. I don’t know about you, but I definitely paid more than 17% in taxes.
But the GOP wants to cut Medicare and Social Security benefits for working families -- offloading more of the costs onto our back and flipping administration to the private sector so Wall Street can reap the profits. And are they doing this to cut the supposedly frightening federal deficit? No. Over 70% of the “savings” from Rep. Paul Ryan’s budget cuts will go not to paying off federal debt but giving even further tax cuts to the richest two percent.
Of course, because the same 400 people and their corporations give politicians most of their contributions, there is little incentive for politicians on either side of the aisle to raise taxes on the super-rich. For instance, Paul Ryan’s leading campaign donors come from the insurance industry -- wealthy individuals whose businesses will benefit most from the privatization of Medicare and Social Security. In 2010 alone, the insurance industry fat cats gave Ryan over a quarter of a million dollars.
Still, there’s reason for politicians on both sides of the aisle to resist the pressure from their elite donors and do the right thing. According to a recent poll, 72% of Americans support raising taxes on the super-rich. In fact, even 54% of Republicans support such measures.
Not only that but raising taxes is pragmatic. At a time of still-stifling unemployment where working families are feeling the pinch of economic hardship as CEO bonuses continued to reach record highs last year, the rich can afford to pay their fair share while working families cannot afford any of the expenses proposed budget cuts would offload onto their pockets.
Whether you know it or not, you benefit frequently and vastly from government spending which allows you to take advantage of roads and electricity and schools to an extent you wouldn’t be able to afford individually.
Cutting the very programs middle class families need most will not only create more economic pressure on us all in the short term but, in the long term, further cripple the middle class on which any stable economy is built. A strong economy can exist with a slightly less wealthy elite. A strong economy cannot exist without a middle class.
But polling and pragmatism aside, there is a powerful moral case for taxing the rich -- one that asks what kind of country we are and want to be. When faced with moments of economic pain, do we ask those who have already sacrificed so much -- their jobs, their health insurance, their economic stability, their live savings -- to suck it up and sacrifice more?
Or do we understand that to those who are given much, much is expected -- ask the most fortunate and powerful among us to defend our nation not with weapons but dollars, contributing to a better future and a better economy for all of us?
Can you name a nation where elites rule unscathed and the masses are attacked? That’s Libya. The nation where we all stand united for the common good and everyone, including elites, do their part? That’s America.
Sally Kohn is a community organizer and political commentator. She is the Founder and Chief Education Officer of the Movement Vision Lab.