The Rich Will Get What They Paid For

Many of the headlines, and most of the chatter, about last night’s well-crafted, well-delivered, not to mention inspiring, State of the Union address had to do Displaying 20150120_231217.jpgwith how feisty President Obama seemed to be:

The New York Times: Obama Defiantly Pushes His Agenda

The Kansas City Star: In State of the Union speech, President Obama pushes an aggressive agenda

Pushes. Agenda. Hmm. I wonder what Republicans thought about the uppity agenda-pusher and his defiant, aggressive agenda? Let’s look:

Republicans dismiss president’s proposals from State of the Union address

The New York Times: G.O.P. Response to Obama’s Sweeping Proposals: ‘No’

Why, of course! After all, we are talking about Republicans. Obviously they don’t like the following proposals Obama made on behalf of working folks and their families:

Raise the minimum wage
Require employers to provide paid sick leave for the 43 million now without it
Increase child tax credits
Make community college free
Give other college students a tax credit
Expand the earned income tax credit

Let me be clear: Republicans don’t hate these proposals because they hate working people. Nope, not at all. Even though sometimes it seems like they do hate working folks, they really don’t. I mean it. They really don’t. They actually appreciate working folks. You know why? Because working class people just keep right on working, harder and harder every day, no matter their pay or their benefits or the cost of raising their kids or getting them through college. They just keep at it. Because they have to. And that’s one thing Republicans appreciate about them.

But they really appreciate the working class when, after having been savaged by the GOP’s voodoo economics, a significant number of politically depressed workers will stay home and not vote for Democrats on election day. And Republicans really, really appreciate those workers who, despite being cursed by the right’s voodoo priests, will run to the nearest polling place and vote for more voodoo.

So, no, it’s not that the GOP doesn’t like the working class. It’s just that in order to do the things President Obama and the Democrats want to do to help them, things would have to change a little bit for some folks and businesses that Republicans really, really love: the wealthy and the big banks. Taxes and fees would have to go up on those two groups in order to pay for the new programs and expansion of old programs that Obama mentioned in his speech.

Thus, we have this rather easy and quite realistic analysis by Nicole Hart, director of trusts and estates at Sontag Advisory, a wealth management firm in New York:

My initial reaction is that nothing is going to happen in a Republican-controlled Congress. Our advice to clients is that we’re not worried this is getting passed.

Not to worry, rich people! Your investments in the GOP have paid off! Republicans are in control! Now the rest of you stiffs out there better get your asses back to work!

4 Comments

  1. ansonburlingame

     /  January 22, 2015

    Duane,

    A little history, recent history, shows that solutions to issues called for in any SOTU address, regardless of political party of the President, seldom result in real legislation as called for by the President. Count the issues and solutions raised in a give SOTU address and wait a year or two to see legislative results. The percentage is very low, again regardless of party affilation of the President.

    My oldest son is now working at the senior executive level of a recently merged law firm. For 20 years he merely practiced law related to issues between businesses, interpreting the law to reach compromise or victory in a court for his clients. Now his newly merged firm has gone from a “boutic international law firm”, to one doing business in 44 locations in 21 countries across the world. Analyzing legislative outcomes now is very much a part of his business.

    He sent me an 11 page summary of the SOTU address, a very pragmatic and non-partisan summary. It looked for areas where the firm believes compromise and thus legislative progress is possible for the next two years. Very interesting thinking, at least in my view and again very non-partisan, advocating a particular outcome.

    Three areas were highlighted, Trade, Transportation and MAYBE tax reform, as possible areas for progress through legislation. The paper detailed the postitions on both sides of the aisle and how compromise might work. Obviously any compromising positions on any issues must result from “moderate Dems” and “mainstream GOP” coming together to overcome the left and right wings of the parties.

    If nothing else, the 2014 election showed the majority of voters seeking such cooperation between the two parties rather than the insessant gridlock between the two wings of each party. In my view we still have a long way to go.

    Anson.

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    • Anson,

      I appreciate you sharing that information. The thing is that there is no evidence available to us since 2009 that Republicans are in any mood to compromise. Oh, sure, they’ll probably take Obama’s offer to do a fast-track trade deal, but that’s probably about it. But even that deal, as it stands right now, isn’t much of a compromise for Republicans. If the Chamber of Commerce is on board and the labor unions are opposed, that’s hardly a serious compromise for right-wingers.

      And as far as a majority of voters seeking cooperation between the two sides, I think that is true of Democrats but not true of Republicans. Polls consistently show that a majority of Democrats and independents want both sides to work together via compromises, but only about one-third or so of Republicans do. That’s why we see the polarization, rather hopeless polarization, in D.C.

      Duane

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  2. Seems to me the single biggest government mechanism for widening the wealth gap between the wealthy and the working class is the low capital-gains tax rate. Currently a married couple with an AGI of $73,800 can cash in on accumulated capital gains in stock at only 15%. This same rate applies to capital gains achieved by mutual funds realized during the tax year. At this late stage in life I am personally benefitting from this and I can attest that it feels like almost-free money. I didn’t work for it, made nary a single widget to earn it. It just comes rolling in, and the more one invests, the more of it there is. Amazing. In engineering terms, this is an unstable system and carried to the ultimate, such an economy would devolve to an oligarchy and another Gilded Age. I think that’s where we’re headed.

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    • I hope you’re wrong, but, alas, I cannot contradict you with anything but hope that it will change sometime in the future. People who make money with money are blessed by our laws and people who make money with labor are not. That is the simple truth of the matter and until the latter take away control of the system from the former, it will remain that way or, as you frighteningly suggest, it will get worse.

      Duane

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