CLASS WARFARE: BRING IT ON!

Richard Reeves

LOS ANGELES -- President Obama came out here last Tuesday to proclaim himself a "warrior for the middle class." Would that it were true.

In a similar situation to what we have today -- that is the rich get richer and the poor (and middle class) get poorer -- President Franklin Roosevelt said of what used to be called plutocrats: "I welcome their hatred."

I'm not sure that Obama, the rationalist beloved, is capable of talking that way or acting that way. Evidence be damned, he has acted as if we are in a time of rational discourse about class, job creation, incentives, and all the rest of modern populism. He seems to accept Republican and conservative blather about "job creators." Where the hell have the job creators -- rich investors and their banks -- been these last few years of heartbreaking struggle for the middle and lower classes?

Well, they have been "creating wealth," piled up in banks, profits and their own accounts. The "investing class," as President George H.W. Bush called them, have been creating jobs -- in China and other points east maybe, but not here.

In The Guardian in England, economist Richard Wolff has written:

"The charge of class war is particularly obtuse. Consider simply these two facts. First, at the end of the Second World War, for every dollar Washington raised in taxes on individuals, it raised $1.50 in taxes on business profits. Today, that ratio is very different: For every dollar Washington gets in taxes on individuals, it takes 25 cents in taxes on business. In short, the last half-century has seen a massive shift of the burden of federal taxation off business and onto individuals.

"Second, across those 50 years, the actual shift that occurred was the opposite of the much more modest reversal proposed this week by President Obama; over the same period, the federal income tax rate on the richest individuals fell from 91 percent to the current 35 percent. Yet, Republicans and conservatives use the term 'class war' for what Obama proposes -- and never for what the last five decades have accomplished in shifting the tax burden from the rich and corporations to the working class.

"The tax structure imposed by Washington on the U.S. over the last half-century has seen a massive double shift of the burden of taxation: from corporations to individuals and from the richest individuals to everyone else. If the national debate wants seriously to use a term like 'class war' to describe Washington's tax policies, then the reality is that the class war's winners have been corporations and the rich. Its losers -- the rest of us -- now want to reduce our losses modestly by small increases in taxes on the super-rich (but not, or not yet, on corporations.)"

In the interest of fairness and balance, this is part of the counterargument, as articulated by the conservative provocateur Gary Bauer, writing in Human Events, the iconic publication of America's right wing:

"In three years, Barack Obama has morphed from the Herald of Hope to the Envoy of Envy.

"The president has always been an eager class warrior. But he has now taken things to a new level, making the politics of envy and resentment the signature theme of his re-election campaign ...

"Obama's plan wouldn't hit just the oft-targeted 'millionaires and billionaires,' of course. It includes letting the Bush tax cuts expire for people earning as little as $200,000 a year. And it is not the rich but the middle class and poor who will suffer most when Obama's taxes on high-earners prompt small businesses to stop hiring and cause the wealthy to reduce their charitable giving."

Ah! Noblesse oblige!

Where is all this going? This is something Warren Buffett and Mayor Michael Bloomberg of New York, along with lefties like Wolff and Michael Moore, have begun to talk about, violent class warfare -- in the streets -- if the wealth inequity continues to drive the economy. As Wolff wrote: "Then Washington might learn what class war really is."

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