Friday, September 19, 2008

Note To Obama: Tie The Tax Increase On The Top 5% To The Bailout



(image via mcclatchydc)

There is much to admire about the populist Jacksonian Senator Jim Webb, already in the running to become one of the most effective Senators of the past half-century. But the Senator's theories, however, on corporate fair share are only three-quarters persuasive. And also, in a way, are the arguments of Senator Joe Biden, another populist hero of the white working class voter. Senator Webb argues, with unassailable figures and with great Scots-Irish gusto, that corporate salaries in America are sometimes 400 times the average wage of the average employee; we are at present living in a "Dobbsian" state of Nature. Emotionally that is a powerful statistic, but intellectually, even now, the word that comes to mind is: So?

Isn't the CEO the head of the organization? Ought the CEO not to be rewarded with a comparatively impressive salary? And, granted, the wholly valid arguments that failure is rarely punished when meting out golden parachutes, Does not the CEO have larger responsibilities than the average worker? Even if the company is private, doesn't said corporate head have to answer for their every decision? Don't they have to answer to the press, endure the hardships of bad news stories and navigate the breakers of a bad day on a minute-by-minute basis? And with regards to salary, who is forcing the average worker to remain in a situation where they feel uncomfortable in making 1/400th of the salary of the CEO? These are all, to be sure, cold, hard, free market responses, but they are entirely justifyable and intellectually understandable, no?

Similarly, Senator Biden yesterday said that The Rich -- the 5% who would shoulder a tax rollback under Obama's economic plan -- should pay their fair share on the grounds of "Patriotism." Again, what if these affluent voters do not see a discernible link between their Patriotism and the shouldering of what can only be properly construed as a tax hike? Further, many of these affluent voters could make the argument that a tax increase would smother growth at a time when the United States needs to remain competetive. For further reference read Mitt Romney's speech at the Republican convention.

But both Biden and Webb are essentially correct, if only three-quarters so in their argument. The other quarter missing from their argument is to tie the tax increase to the bailouts. It is not enough to play the Populist Game, pitting the numerically superior 95% against the wealthier 5%, further clefting this country into twain. We've already had a divider in office for seven-plus years and look, dear reader, upon where that has gotten us (Averted Gaze). Tying those tax increases to the bailout of our most prominent financial institutions completes the equation, their argument. Who could argue against its iron logic? America's economic top 5% directly benefit from the bailout, whereas the bottom 95% see no immediate benefit nor do they feel any particular loyalty to preserving the nation's most powerful financial institutions..

And so we ask Obama to find linkage in his soaring rhetoric between the bailout and the tax increase and give the speech that will heal our sorely divided America on the subject of the economy.

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