With more than 13.5 million Americans still out of work, the high cost of failing to establish fair and reasonable rules of the road for the financial sector is devastatingly clear. Unfair and reckless conduct by financial special interests cost Americans more than 8 million jobs, hundreds of billions in taxpayer funded bailouts, more than $8 trillion lost in home values and retirement savings, and millions of foreclosures.



The American public wants and needs an effective Consumer Bureau to prevent rip-off financial products laden with tricks, traps, and hidden fees. Abusive financial products take tens of billions of dollars a year out of our pockets, sending them to feed the inflated bonuses of a handful of Wall Street CEOs.



The leadership of the House Financial Services Committee has made no secret of the fact that they oppose the CFPB. For example, Rep. Neugebauer, chairman of the subcommittee on Investigations and Oversight, said directly, “I don't like them.” Chairman Bachus said “my view is that Washington and the regulators are there to serve the banks.” It certainly serves the financial special interests to disarm the CFPB.



The American public wants an end to shady business practices, and overwhelmingly supports the CFPB and Wall Street reform. Members of Congress should stand with consumers and reject these proposals to weaken the CFPB.

If the House Republican budget blueprint released on Tuesday is the “path to prosperity” that its title claims, it is hard to imagine what ruin would look like. The plan would condemn millions to the ranks of the uninsured, raise health costs for seniors and renege on the obligation to keep poor children fed. It envisions lower taxes for the wealthy than even George W. Bush imagined: A permanent extension for his tax cuts, plus large permanent estate-tax cuts, a new business tax cut and a lower top income tax rate for the richest taxpayers.

The only way America can reduce the long-term budget deficit, maintain vital services, protect Social Security and Medicare, invest more in education and infrastructure, and not raise taxes on the working middle class is by raising taxes on the super rich.



Even if we got rid of corporate welfare subsidies for big oil, big agriculture, and big Pharma-- even if we cut back on our bloated defense budget-- it wouldn’t be nearly enough.



The vast majority of Americans can’t afford to pay more. Despite an economy that’s twice as large as it was thirty years ago, the bottom 90 percent are still stuck in the mud. If they’re employed they’re earning on average only about $280 more a year than thirty years ago, adjusted for inflation. That’s less than a 1 percent gain over more than a third of a century. (Families are doing somewhat better but that’s only because so many families now have to rely on two incomes.)



Yet even as their share of the nation’s total income has withered, the tax burden on the middle has grown. Today’s working and middle-class taxpayers are shelling out a bigger chunk of income in payroll taxes, sales taxes, and property taxes than thirty years ago.

It’s just the opposite for super rich.



The top 1 percent’s share of national income has doubled over the past three decades (from 10 percent in 1981 to well over 20 percent now). The richest one-tenth of 1 percent’s share has tripled. And they’re doing better than ever. According to a new analysis by the Wall Street Journal, total compensation and benefits at publicly-traded Wall Street banks and securities firms hit a record in 2010-- $135 billion. That’s up 5.7 percent from 2009.



Yet, remarkably, taxes on the top have plummeted. From the 1940s until 1980, the top tax income tax rate on the highest earners in America was at least 70 percent. In the 1950s, it was 91 percent. Now it’s 35 percent. Even if you include deductions and credits, the rich are now paying a far lower share of their incomes in taxes than at any time since World War II.



The estate tax (which only hits the top 2 percent) has also been slashed. In 2000 it was 55 percent and kicked in after $1 million. Today it’s 35 percent and kicks in at $5 million. Capital gains-- comprising most of the income of the super-rich-- were taxed at 35 percent in the late 1980s. They’re now taxed at 15 percent.



If the rich were taxed at the same rates they were half a century ago, they’d be paying in over $350 billion more this year alone, which translates into trillions over the next decade. That’s enough to accomplish everything the nation needs while also reducing future deficits.



If we also cut what we don’t need (corporate welfare and bloated defense), taxes could be reduced for everyone earning under $80,000, too. And with a single payer health-care system-- Medicare for all-- instead of a gaggle of for-profit providers, the nation could save billions more.



Yes, the rich will find ways to avoid paying more taxes courtesy of clever accountants and tax attorneys. But this has always been the case regardless of where the tax rate is set. That’s why the government should aim high. (During the 1950s, when the top rate was 91 percent, the rich exploited loopholes and deductions that as a practical matter reduced the effective top rate 50 to 60 percent-- still substantial by today’s standards.)



And yes, some of the super rich will move their money to the Cayman Islands and other tax shelters. But paying taxes is a central obligation of citizenship, and those who take their money abroad in an effort to avoid paying American taxes should lose their American citizenship.



But don’t the super-rich have enough political power to kill any attempt to get them to pay their fair share? Only if we let them. Here’s the issue around which Progressives, populists on the right and left, unionized workers, and all other working people who are just plain fed up ought to be able to unite.



Besides, the reason we have a Democrat in the White House-- indeed, the reason we have a Democratic Party at all – is to try to rebalance the economy exactly this way.



All the President has to do is connect the dots-- the explosion of income and wealth among America’s super-rich, the dramatic drop in their tax rates, the consequential devastating budget squeezes in Washington and in state capitals, and the slashing of vital public services for the middle class and the poor.



This shouldn’t be difficult. Most Americans are on the receiving end. By now they know trickle-down economics is a lie. And they sense the dice are loaded in favor of the multi-millionaires and billionaires, and their corporations, now paying a relative pittance in taxes.

Wednesday Wall Street shill Spencer Bachus of Alabama, who's accepted $4,644,824 in direct legalistic bribes from the financial companies he's supposedly helping to regulate, gaveled to session a meeting of his House Financial Services Committee with the express purpose of putting together a bill to weaken the Consumer Financial Protection Bureau (CFPB). Remember, that bureau was created-- Republicans and conservative Democrats squawking the whole time-- in the wake of the Great Recession caused by predatory and abusive Wall Street practices. The idea was clearly to put a cop on the beat standing up for consumers in the financial marketplace, something anathema to GOP/Randian Law of the Jungle ideology, where the strong-- and predatory-- prosper while the unwary and meek get chewed up and spit out.Bachus' own bill, HR 1121, would gut the bureau’s authority by making it easy for the other, more bankster-dominated, regulators to overturn its actions, while Sean Duffy's bankster-friendly proposal (HR 1315) seeks to limit the authority of the CFPB, and delay the July 21 transfer date of powers to the CFPB until a director is confirmed by a Senate in full obstructionist and filibuster mode. Yesterday Americans for Financial Reform, a coalition of more than 250 national and state organizations working together for strong Wall Street reform, issued a statement warning the public of what Spencer and his cronies are up to-- and why it's so dangerous.Meanwhile, Republicans, when they're not consumed with plotting for the shutdown of government altogether, have been busy pushing Paul Ryan's "cause," his dystopian Randian vision of a darker, meaner unlivable America, one that yesterday's summed up like this:Ahhh... yes, the richest taxpayers (or, as is often the case, tax), the fatcats for whom deluded teabaggers serve as faithful, if unwitting, foot soldiers. Republican policy, much of it embraced by conflicted conservative Beltway Democrats, is predicated on lessening their "burden." Monday that isn't what Robert Reich was recommending , not if this country is going to prosper.The GOP is so hysterical that the multimillionaires who finance their political careers haven't gotten big enough tax breaks that they are demanding endlessly increasing cutbacks... more and more and more-- purprose being, obviously, to cripple government entirely, especially when it comes to the programs conservatives have always hated, like protecting workers, minorities, women, consumers... In Ohio, John Kasich's predatory budget is even forcing the closure of his own daughters' schools ! What the debate-- really more like a hostage situation with the GOP threatening to kill the whole economy and the Democrats in Stockholm Syndrome mode-- over shutting down the government comes down to this morning is that the craven, conflicted, cowardly Democrats have already given in to the GOP on absymally bad cutbacks for the future of the country and the lives of ordinary working families, paired with trillions right into the pockets of the rich. A handful of real progressive excepted, satisfied that they don't have to stand up like men and fight, in the Democrats' minds "the only sticking point left is an extreme policy measure that would cut off funding to women’s health centers that provide services like cancer screenings. A government shutdown would be devastating to our economy, middle class families, and our troops. Republicans should not shut down the government over ideological issues around women’s health centers. The Tea Party may be cheering for a shutdown, but the American people are not. By a 25 point margin, Americans say they want their representatives to compromise rather than force a shutdown. The margin is even wider among Independents-- 66 percent to 30 percent." When will Democrats learn that appeasing bullies and fascists never works? NEVER.Krugman, who has made it clear he thinks Paul Ryan is nothing but a hollow flim flam man and a shill for the rich and powerful who finance his career, shows why his budget proposal is not serious but a combination of cruel and ludicrous , a point Rep. Jerry Nadler made to the Congressional Progressive Cause earlier this week:She did today : “This is precisely the goal of the forces at work to politicize the CFPB’s funding. If they succeed, the beneficiaries will be some of the same institutions that precipitated the financial crisis... In the guise of greater accountability, it would be possible to restructure the new consumer agency to make it less-- not more-- likely to achieve its stated goals."

Labels: Chris Larson, Jerry Nadler, Paul Krugman, Paul Ryan, Robert Reich, Spencer Bachus, tax policies, Wall Street reform