Let Bush Tax Cuts Expire in January!

Congress must allow the George W. Bush administration’s unfair federal tax cuts to expire this January — and let's not call the result a tax increase!

I am not a socialist. But I am a social democrat. In the 1890s a wonderful politician from Nebraska, William Jennings Bryan, three-time candidate for President, preached “the Social Gospel.” He was against too much Wall Street, too much paper wealth, and especially against the increasing concentration of the country’s growing wealth into too few hands.

I’m not “against the rich”—my concern is not simplistically focused on the rich getting lower taxes. Rather, I’m in favor of a better life for all Americans.

In Tony Judt’s seminal 2010 book, Ill Fares the Land, we read reliable graphs proving how income inequalities have grown enormously since about 1970. In 2005, 21.2 percent of U.S. national income accrued to just 1 percent of the earners. America’s “Gini coefficient” (the conventional measure of the gap separating the rich and the poor) is about that of China. While the income inequality gap was shrinking between 1870 and 1970, in the last American generation it has widened greatly, unlike in most European Union countries.

The federal government’s massive tax-cuts, set to expire this January, cannot legitimately be called tax increases as Senator Mitch McConnell (R-Ky) and some Republicans now try to label them. It’s just not true.

Condensed, the expiring Bush tax-cuts will significantly affect the top two percent of American households — holding perhaps 40 percent of all U.S. wealth — by reverting to a 39.5 percent tax rate rather than the 36 percent rate they’ve enjoyed from 2001/2003. Remember, they paid this 39.6 percent rate before; the 39.6 percent is not new, and when restored in January it is therefore not a “tax increase.” Further, the expiration restores (does not create) the 20 percent tax rate on capital gains, and taxpayers in the top two brackets will also pay 20 percent on dividends. Finally, the estate tax on inherited wealth imposes a 45 percent tax of inheritances above $7 million for couples.

Bill Gates and Warren Buffet, among others, favor an inheritance tax. Getting $3.5 million from your mom or dad seems plenty generous to most of us middle-income Americans who will not be getting over $500,000 from our long-living parents, god bless them.

If any of these amazingly wealthy two percent of citizens supported either of our crazed military adventures in Iraq or Afghanistan, or enhanced their paper fortunes by profiting from the recent financial bubble, they might be pleased to be able to make up for their lack of judgment by ruefully paying more to the government beginning in January. How can plutocratic Republicans support two losing and insanely expensive foreign wars (Iraq and Afghanistan), and a very expensive prescription drug benefit given to older Americans on Medicare, yet moan about the extension of the recent jobless benefits bill? Their math doesn’t compute at all.

As others have pointed out, the deeper question that begs to be asked is: “Who counts as rich?” There’s an entire group out there, whom James Surowiecki calls “the lower upper class,” who have fallen short of the to one-to-two percent of earners.

In order to be consistent, let’s look at the expiration of tax cuts for the “middle class,” realizing it’s a slippery label at best. A July 25 New York Times financial analysis did not go into the additional money the middle class would have to pay if their tax cuts expire — but it could amount to as much as $1.6 trillion over several years. Since this issue is so political, what with the November Congressional elections looming, conventional wisdom holds that neither party would dare eliminate this “middle class” tax cut.

But the press should examine this complicated issue, because the explosion in wealth at the top of the pyramid (particularly in the very top one tenth of the top one percent) has meant many doctors, lawyers, accountants, and investors making more than $150,000 a year (or $200,000 per household ) do not feel “rich,” and desperately want to retain their lower tax rate. Yet I favor ending my own “middle class” economic group’s tax-breaks in January, along with those of the wealthier tax brackets. Its part of the Social Gospel that those of us actively working should contribute to the welfare of others — the elderly, the disabled and ill, the poor, and the homeless.

Without the restored revenues from all the expiring tax cuts, our federal government, which we expect to do so much, will lose around $3 trillion ($3,000,000,000) over the next decade. Treasury Secretary Timothy Geithner, a Wall Street insider if there ever was one, said last month that the expiration of the tax-cuts would not harm the economic recovery. Recent Nobel Prize winner in economics Paul Krugman agrees. Yet all we hear from conservatives is, “Don’t raise my taxes!” (See: Tea Party.) We have to ask: Where is the gratitude from the wealthiest 2 percent of Americans for their nine years of fabulous tax cuts, given out in 2001 and 2003 during the financial bubble? It’s like the political leaders of the city of Bell [LA] paying themselves outlandish salaries.

Digital Maoism -- A Review

Digital Maoism — a review of Lanier's You Are Not A Gadget

In his book You Are Not a Gadget, a collection of columns previously published online, digital pioneer Jaron Lanier considers how “cybernetic totalism” destroys creativity on the web, while the anonymous character of online trolls limits true debate.

Lanier is an Internet pioneer, credited with coining the term “virtual reality.” He’s also been a leader in developing the software for immersive virtual reality applications. This former net enthusiast now inveighs against a variety of digital phenomena: from the now-standard, locked-in web designs that he derides as Web 2.0, to belief in “the Singularity,” which is the notion that computer intelligence and competence—their fitness to lead—will at some point surpass that of humans.

Lanier notes that Google co-founder Larry Page is not alone among the cloud lords in believing the Internet will literally come alive. Others think this may have already happened: The “blogosphere” is a living cosmos in the minds of some. Students of world religions will resonate with Lanier’s comparison of the techies’ “faith” in the Singularity, and orthodox Religion. Or Maoism, for that matter.

We once had an IT guy at my school who enthusiastically touted our 21st century students as digital natives compared to veteran teachers who were digital barbarians. But Lanier argues that the once-beautiful digital dream of intense, creative individuality has been suffocated by the conformity-creating “hive mind.”

It is fair to say that Lanier, who calls his book a “manifesto,” has humanistic concerns about the diminishing sense of hope and promise in the vision of an international community instantly linked together. He talks about how the individual human participants in the web end up as “peasants” working for the “lords” of technology—Google, Yahoo, and hedge-fund managers with vast analytic resources. Lanier has the courage to show how the cloud lords profit from our volunteer labor; how we’re letting our kids become liquid-crystal serfs. Yes, a young person may have hundreds of “friends,” but practically all of them are on Facebook. When a web design is so locked-in that an actual human’s definition of friend gets deeply altered, Lanier writes, the “idea of friendship is reduced.”

Lanier is surely onto something when he states that a culture of sadism has gone mainstream online. He refers to the nasty edit wars on Wikipedia as well as on Slashdot, both of which accept pseudonymous comments, as “drive-by anonymity.” When my own on-line feature article appeared in the Santa Barbara Independent’s Voices column under the title “Open Carry at Starbucks [July 1, 2010]” it quickly developed a fascinating, long tail of corrosive digital comments—soon numbering 100—signed with pseudonyms. After reading Lanier’s fine book, I realize that it shouldn’t have surprised me how few of the writers really took up the question I raised, which was: Should people be able to swagger around Montecito Starbucks openly displaying handguns, even if they are unloaded?

No one picked up on my quotation from the Constitution’s famous Second Amendment, which involves Americans’ notorious gun rights; and no one directly addressed my question asking if “Arms” meant long weapons of the 1791 type or today’s extremely powerful handguns like Glocks? (I had written, “The Second Amendment to our great United States Constitution, in order to ensure ‘the security of a free State,’ guarantees citizens the right ‘to keep and bear Arms.’”) Dominating the long thread were commenters with such names as Major, Jarhead, gravedigger, and Edukder, using terms like “Eurotrash,” “snot-nosed journalist,” or “this coward who is so against guns.” (That last epithet was bravely signed by Against Cowardly Writing.)

Readers who need further proof of the nastiness of on-line anonymous commenting need look no further than the response to Matt Kettmann’s cover article A Mosque Grows in Goleta. Or the long tails of amazingly nasty meta-comments during the endless healthcare debate.

I believe Lanier’s book should be carefully read and its warnings heeded. In 21st century America I see a digital flattening and reduction of the self. After 36 years of teaching, I am deeply concerned that our kids are far too wired-up, far too “electronified.” They sit in front of various screens too many hours per week, prefer sitting to running. They need to get out more. Back to outdoor sports and active, experiential learning. Back to dinner at home with the family. Back to nature!

Lanier’s book gives us an insider’s critique of Internet technologies today. He’s a humanist in Silicon Valley drag, an apostate from the Singularity, a cybernetic Jeremiah warning us against where we’re going. All that being said, Lanier mentions three potential solutions in Chapter 8—read the book to find out what they are—and still feels the Internet holds genuine promise for humanity and for the planet. Let us hope so.