by Constance Daley
St. Simons Island, Ga.
NO SMOKING - BUT IT'S O.K. TO KINDLE
DUMMERSTON, Vt. -- Politics is all about salesmanship and getting your message across to voters.
In this regard, President Obama and the Democrats have failed miserably.
According to a recent New York Times/CBS News poll, about one-third of voters believe that the Obama Administration has raised taxes for most Americans, compared to only 8 percent who believe - correctly! - that he has lowered them.
Mr. Obama's stimulus package lowered taxes for most working Americans and put an extra $400 into their pockets. But you'd never know that fact from reading or listening to the news.
That's why allowing the Bush Administration's tax cuts to expire for the wealthiest 2 percent of Americans, while extending them for those who earn less than $250,000 a year is the ultimate political no-brainer for Democrats.
It's also an economic no-brainer. The non-partisan Congressional Budget Office looked at 11 different policy options for stimulating the economy. The CBO found that the least effective option was cutting taxes for the wealthy, since they are likely to save their money than spend it.
As the CBO put it, "tax cuts, though difficult for politicians to resist in an election season, have limited ability to bolster the flagging economy because they are essentially a supply-side remedy for a problem caused by a lack of demand."
That was echoed by Moody's, which found that when the top tax rate on the wealthy was increased from 31 to 39 percent by President Clinton in 1993, the saving rate dropped while the Standard & Poor's 500 stock index increased. By comparison, when President Bush cut the top tax rate to 35 percent in 2001, the saving rate increased while the Standard & Poor's 500 stock index decreased.
Study after study shows that increases in the top marginal tax rate for the wealthiest in our society does not weaken the economy or significantly decrease consumption. At the same time, when more money is put into workers' pockets, it creates more spending, which creates more demand, which creates more jobs, which creates prosperity.
And forget this week's proclamation that the recession is officially ended last year. For most Americans, times are still hard. According to the U.S. Census Bureau, the poverty rate surged to 14.3 percent in 2009, up from 13.2 percent in 2008. There are now 43.6 million Americans living in poverty, the highest number in the five decades that the Census Bureau has been keeping those statistics.
The official federal poverty level for a family of four is $21,756 a year, which is not nearly enough to pay for food, shelter, transportation or health care. Even at 200 percent of the poverty level - roughly $43,000 a year -it's difficult. Yet the Census Bureau found 1 in 3 Americans not even earning that level of income, and that ratio is steadily rising.
Many Democrats are afraid to make the following statements out of fear of being branded as engaging in "class warfare." But these numbers say it all. The share of income going to the wealthiest 10 percent of American households - those earning more than $100,000 - has risen from 34.6 percent in 1980 to 48.2 percent in 2008, while incomes for those who earn under $40,000 a year have been essentially flat for nearly 40 years.
Even before the current recession, working Americans had been squeezed hard. Now, with 29 million Americans either out of work or forced into part-time work, we're seeing class warfare waged by the wealthy and powerful against the rest of us - and the rich are winning big time. The disparity between rich and poor has reached the levels of the late 1920s, just before the Great Depression, while the number of long-term jobless is the highest its been since the 1930s.
So where are the Democrats? Why aren't they defending the interests of working Americans? Because the party sold them out long ago. They allowed the financial sector to be deregulated and let the markets become one giant casino. They allowed our manufacturing sector to wither and allowed jobs to be shipped overseas. They allowed labor unions to be destroyed and the social safety net to be slashed. They allowed corporate power to grow unchecked, and for more wealth to be concentrated into fewer hands.
Yes, Republicans have also been responsible for all this. But we expect Republicans to behave like this. That's what their party stands for, and we'll get a lot more of it if Republicans regain control of Congress in November.
But Democrats once stood for the opposite of these policies, and the result was a fair, just economy and a prosperous nation in the 1950s and 1960s. But the Democrats slowly backed away from these principles, and are now as much blame for the death spiral that our nation is in as the Republicans.
Being less worse than the crazy Tea Partiers who have taken over the Republican Party is not enough for the Democrats. They need to regain the trust of working Americans, and to do that, the Democrats need to stand again for the common good and fight against the expansion of corporate power into every aspect of our lives.
Unfortunately, the Democrats won't do this. Yes, President Obama has nibbled around the edges of the many problems facing our nation. Yes, he inherited a mess the Bush Administration that will take many more years to clean up. But even with a robust majority in Congress and a groundswell of popular support, he squandered so many chances to make his presidency a truly transformative one.
In an economy with near double-digit unemployment, it is imperative that we create jobs. We also know there's also no shortage of public infrastructure that needs rebuilding. A revival of President Franklin D. Roosevelt's Works Progress Administration and Civilian Conservation Corps could solve both problems.
In the longer term, we need to shift our economy to a cleaner and more energy-efficient path, we need to really overhaul our health care system and we need to re-regulate the financial markets to prevent a replay of the recklessness and fraud that brought our economy to the brink of collapse.
In other words, the Democrats need to go big or go home. In the six weeks left before Election Day, they must either offer a positive and ambitious agenda that will help create an economy that works for all of us, or get thumped at the polls in November.
Randolph T. Holhut has been a journalist in New England for more than 30 years. He edited "The George Seldes Reader" (Barricade Books). He can be reached at firstname.lastname@example.org.