Class War Winner

Much is being said by Republicans about a class war being waged by President Obama and Democrats.  In their fantasy world this class war is attacking so called job creators.  All this talk is pure nonsense, absolutely false and misleading, intentional political garbage designed to intentionally mislead gullible Americans stupid enough to believe the lies.  Here is the truth: There has, indeed, been a class war waged in the US; it has been going on for a good thirty years.  And this real war has been won.

There are official data over time called the Gini index or coefficient between zero and one that is a statistical measure of economic inequality.  When it is zero national income is evenly distributed among all citizens, and when it is one all the income goes to one person.  Obviously the Gini figure will be somewhere between zero and one.  Some nations have very low values and others very high ones.  In the high category is the US.  But more important is that the index has changed over time, rising from about 1980 to current times, after it had remained fairly stable over several decades.  That significant rise from about .37 to .45 shows unequivocally that the rich got richer as most of the population in the middle class and below lost ground.

To truly appreciate what has happened you must seriously examine some data.  For example, between 1979 and 2005 the inflation-adjusted income of families in the middle of the income distribution rose 21 percent. That is very slow growth, especially compared with the 100 percent rise in median income over a generation after World War II when inequality actually decreased.  More importantly, over the same period, the income of the very rich, the top 100th of 1 percent of the income distribution, rose by 480 percent.  Absorb that number for a few moments.  In 2005 dollars, the average annual income of that group rose from $4.2 million to $24.3 million.   Those numbers describe the true class war in which the rich and powerful were the clear winner.

Presently, according to new estimates by the nonpartisan Tax Policy Center, one-fourth of those with incomes of more than $1 million a year pay income and payroll tax of 12.6 percent of their income or less, putting their tax burden below that of many in the middle class who are likely pay twice that amount or even more.  The class war winners are clear.

Need more convincing?  Consider data from the Tax Foundation. Between 1987 and 2008, the share of income controlled by the top 1 percent  grew to 20 percent from 12 percent. That equates to a total share growth of 67 percent. During the same period, their share of taxes went to 28 percent from 24 percent, indicating a share growth of 17 percent.  Follow that?  The top 1 percent share of income grew nearly five times faster than their share of taxes: 67 percent versus 17 percent.  Pretty darn good deal.  So forget all that malarkey from Republicans that the rich pay so much of the nation’s taxes unfairly.  The class war winners are reaping the rewards of a two-party plutocracy that they own.

Here is another dose of class war reality.  The top 1 percent share of total pre-tax income rose from about 10 percent in 1980 to 21 percent in 2008, a nice doubling that helps explain the rise in economic inequality.  It really pays to win the class war.

The idea that raising taxes on the rich in these dismal economic times in any way represents some injustice is such baloney that one should wonder how any American can possibly eat this Republican garbage.  Similarly, the nonsense about job creators somehow not creating new jobs because of higher taxes flies in the face of reality, because very low taxes have not caused them to create significant new jobs.  Nor did higher taxes for some decades after World War II stop high rates of new job creation.

The rich class own most of the wealth of the nation after winning the class war for some thirty years.  They accomplished this victory by using money to buy and corrupt the political system.  The most perplexing aspect of all this is why most Americans have not risen up in revolt against the political system that has so screwed them.  Those on the right keep supporting Republican candidates that lie to them and actively work against the economic interests of all but the rich.  Those on the left fall victim to the lies of Obama and other Democrats that promise much but deliver next to nothing to bring economic justice to most Americans.  Democrats have also contributed to the killing of the middle class.

Odds are that those who have lost the real class war will continue to suffer until they wake up to the need to overthrow the political system.  The only peaceful strategy being use of the Article V convention option in the Constitution by which state delegates could propose amendments that would reform the political and government system to take away the power used by the rich to steal the wealth of the nation.  Do not ever believe that voting for new Democrats or Republicans will fix our corrupt and dysfunctional system.

One important thing to keep in mind: Raising taxes on the rich is necessary but not sufficient to turn the class war already won by the rich around.

Finally, the path to economic justice must include what Dylan Ratigan is advocating, a constitutional amendment to get money out of politics, which I urge readers to support.  This is the way to remove the key tool used by the rich and powerful to pervert the economy in their favor.  Congress will never propose such an amendment, only a convention will.

Joel S. Hirschhorn was a full professor at the University of Wisconsin, Madison and a senior official at the Congressional Office of Technology Assessment and the National Governors Association; he has authored five nonfiction books, including Delusional Democracy: Fixing the Republic Without Overthrowing the Government. Read other articles by Joel.