‘Class Warfare’ Revisited

A recent Politico article rehashes the issue of class warfare and the tax code, but similar to contemporary conservatism, it ignores reality.

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Gov. Bobby Jindal delivers a speech to the lawmakers in Baton Rouge, Louisiana, Monday, April 8, 2013, announcing that he has shelved his plan to eliminate income taxes and raise sales tax. (AP/The Advocate, Arthur D. Lauck)
Gov. Bobby Jindal delivers a speech to the lawmakers in Baton Rouge, Louisiana, Monday, April 8, 2013, announcing that he has shelved his plan to eliminate income taxes and raise sales tax. (AP/The Advocate, Arthur D. Lauck)

The first time I clicked on this Politico article, titled “Obama, class warrior,” I had to check my calendar. Had I forgotten April Fools Day? What else could explain what otherwise struck me as a purposeful—indeed, expertly executed—parody of a Politico article?

Authored by Jonathan Martin and John F. Harris, the article “reported” that, “There was nothing especially subtle about the way [President] Barack Obama played the politics of class resentment against [Republican presidential candidate] Mitt Romney in 2012.” And the reason for this, they added, was “nothing especially mysterious.” Apparently, “class warfare works.”

Sadly, it was Tax Day, not April Fools Day. Politico was devoting 2,300 words to this accusation without actually ever addressing the issue of whether Gov. Romney and the Republican Party were also practicing the politics of class warfare—indeed, without any real attention to the reality of the candidate’s proposed policies. That fact means it was intended as a serious analysis, rather than as mere propaganda for the wealthy and their political representatives.

Oddly, the authors do find a Republican operative—Pete Wehner—who explains to them that back in the real world, the issue at hand is not President Obama’s embrace of the politics of “class warfare,” but the fact that Republicans have actually been conducting class war against the poor and middle classes for decades. Granted, he isn’t quite that straightforward, but the message is the same nonetheless. According to Politico:

… Wehner, who worked in President George W. Bush’s White House, compared the situation to the West Wing conversations he participated in when the Iraq war turned unpopular. “We didn’t have a messaging problem, we had a ‘facts on the ground problem,’” said Wehner. “And now Republicans have a ‘facts on the ground problem’ in addition to a messaging problem.”

Were the authors to show any interest in these “facts on the ground,” they might have discovered, as the Nobel laureate economist Joseph Stiglitz pointed out on the very same day, that:

The richest 400 individual taxpayers, with an average income of more than $200 million, pay less than 20 percent of their income in taxes—far lower than mere millionaires, who pay about 25 percent of their income in taxes, and about the same as those earning a mere $200,000 to $500,000. And in 2009, 116 of the top 400 earners—almost a third—paid less than 15 percent of their income in taxes.

This is just one of many reasons, as Stiglitz notes, that “the share of income going to the top 1 percent has doubled since 1979, and that the share going to the top 0.1 percent has almost tripled, according to the economists Thomas Piketty and Emmanuel Saez.”

If you consider the explosion of economic inequality that this country has recently experienced to be as much a fact of life as, say, the weather, then keep in mind that it requires actual actions of men and women to make it so—similar to, come to think of it, the weather these days. Stiglitz points out that the degree to which the United States has seen this gap widen is unique among advanced industrial nations. And, on the basis of the data, it’s not possible to argue that such inequality is necessary to spur economic growth—that’s an ideological assertion if ever there was one. According to the evidence, Germany:

… has managed to maintain its status as a center of advanced manufacturing, even though its top income-tax rate exceeds America’s by a considerable margin. And in general, our top tax rate kicks in at much higher incomes. Denmark, for example, has a top tax rate of more than 60 percent, but that applies to anyone making more than $54,900. The top rate in the United States, 39.6 percent, doesn’t kick in until individual income reaches $400,000 (or $450,000 for a couple). Only three O.E.C.D. countries—South Korea, Canada and Spain—have higher thresholds.

The intricacies of the U.S. tax code, especially the lower tax rates instituted on capital gains and “carried interest” than on earned income, do not interest the authors. They apparently believe that when President Obama “brayed” that Gov. Romney “thinks that someone who makes $20 million a year, like him, should pay a lower [tax] rate than a cop or a teacher who makes $50,000,” that the president was playing a divisive campaign trick to get himself elected. They leave no room for the option that, perhaps, President Obama was merely stating a fact.

In fact, as I pointed out in a lengthy examination of Gov. Romney and the Republican proposals last fall for The Nation, Gov. Romney’s economic proposals included an additional $10.7 trillion in tax cuts over the next 10 years, above and beyond the already deeply regressive Bush-era tax cuts, with fully 33 percent directed toward the top 0.1 percent. The fine print called for a reduction in both individual and corporate tax rates, as well as the complete elimination of both the estate tax and the alternative minimum tax. If this had become law, the net result would likely have been that the superwealthy—those who enjoy an income in the vicinity of $3 million annually—got to keep an additional $250,000 at a cost of $9 trillion in lost revenue to the U.S. Treasury.

This would have been in addition to the provisions of the “Ryan plan,” a budget proposal embraced by Gov. Romney—and obviously by his choice for vice president, Rep. Paul Ryan (R-WI), the author of the plan—and passed by a margin of 235 to 193 in the Republican-controlled House of Representatives. Among its provisions were a proposed rise in the Medicare eligibility age for future retirees and a retraction in Medicaid coverage, which, according to the calculations of the Urban Institute, would result in the loss of Medicaid coverage for between 14 million and 27 million Americans by 2021. Meanwhile, another 30 million people—many of them children—would lose the insurance made available to them under Obamacare.

Amazingly, even after all this, Politico still thinks it is President Obama who is the one practicing “class warfare.” Consistent with its journalistic ethos, the news organization turns to the issue of personality rather than actual policy to help readers navigate the issue, as though the rhetoric is more important than reality. The authors quote Stuart Stevens, top strategist of Gov. Romney’s failed campaign, to explain that mere “cosmetic” changes to the party could be effective enough, and that, “I don’t think [Louisiana Gov.] Bobby Jindal has a class problem.”

Actually, bad choice there Stuart (and Politico). Gov. Jindal, as it happens, is fresh off getting his political hat handed to him after trying—and failing—to overturn Louisiana’s tax code in a way that would have shifted the largest burden of the system from corporations and the wealthy to the poor and middle class. Gov. Jindal himself admitted that this was an embarrassing defeat when he withdrew his proposals and explained that legislators and citizens alike told him, “Governor, you’re moving too fast, and we aren’t sure that your plan is the best way to do it.” According to The New York Times’s Campbell Robertson:

All along, opposition to the tax swap was growing broader and more bipartisan by the day. Clergy members urged the governor to drop the plan, saying it could hurt the poor, while the state’s most prominent chamber of commerce group came out against the plan for its potential impact on businesses.

Gov. Jindal’s popularity, according to a recent poll, has now dropped below that of President Obama in Louisiana, a heavily red state that Gov. Romney carried with nearly 60 percent of the vote. So, as it happens, maybe Gov. Jindal does, in fact, have a rather significant class problem.

Finally, as if to make the parody complete, the article contains this insight:

For Obama, this spring’s fights over class represent both a political challenge and a definitional moment. His most consistent argument—that higher taxes on the well-to-do are the essential element in preserving popular government benefits to the middle-class and poor—is in tension with his most consistent promise, that his presidency will break Washington gridlock and elevate problem-solving over ideological purity.

Got that? President Obama’s “most consistent promise,” according to these guys, is to “break Washington gridlock and elevate problem-solving over ideological purity.” What, pray tell, is standing in the way of that? Well, President Obama never promised to “break Washington gridlock.” He promised to try. And infuriating much of his party by becoming the first-ever Democrat since President Franklin D. Roosevelt to propose a reduction in Social Security payments as an opening offer of bipartisanship would appear to go pretty far down that road.

But as I read in Politico on the very same not-April Fools Day, Senate Minority Leader “Mitch McConnell in no mood for bipartisanship.” And as that article accurately points out, “That’s just the Senate. House Republicans, their own seats made even safer by redistricting, are in no hurry bring up immigration, gun control or revenue issues or cave in to Obama or Democrats.”

The reality of the above is that Republicans have no interest in cooperating with Democrats, and they are not afraid to say so. But similar to these same Republicans, Politico’s ace reporters are still finding a way to blame President Obama for this gridlock because, well, just because.

Eric Alterman is a Senior Fellow at the Center for American Progress and a CUNY distinguished professor of English and journalism at Brooklyn College. He is also “The Liberal Media” columnist for The Nation. His most recent book is The Cause: The Fight for American Liberalism from Franklin Roosevelt to Barack Obama.

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Eric Alterman

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