Time to Tax Wall Street

Note: This post was originally published Oct. 24, 2012, but seemed timely to revisit now.

In my last post I asked why neither candidate ever proposes eliminating the capital gains tax subsidy (increasing the capital gains tax rate) as a way to decrease the deficit. Today I will remind readers of another way to reduce our deficit – that is by using a financial transaction tax. Why not tax Wall Street? After all Wall Street bankers didn’t hesitate to use predatory lending and dubious financial instruments to take the home equity savings of millions of Americans.

A financial transaction tax would tax those who can afford to have investments – namely the well off – and easily create funding for those who struggle – namely the working poor.

It is estimated that a paltry 50 cent tax on every investment transaction over $100 would result in additional tax revenue of $350 billion each year! That’s enough to cover our annual budget deficit and then some.

Not surprisingly, the EU has already realized that a financial transaction tax would be way to take back some of the money hijacked by the financial industry and currently ten countries are working toward instituting a transaction tax. Read more here and here.

The banking industry has been a draining trillions of assets from the American people for far too long in the form of bailouts and artificially suppressed overnight bank lending rates. Time to return some of these ill-gotten gains to the public purse.

But ask yourself, “Why is taxing Wall Street never discussed as an option?” “What happens when our government representatives are over privileged elites who consistently vote in their own interests rather than considering the common good?”

You may also like another topic not discussed by either candidate – Extreme Weather – and it’s impact on everyone, but especially on those made poor.

Eliminate Capital Gains Tax Subsidy

Note: This post was originally published Oct. 23, 2012, but seems timely to revisit now.

With so much talk about our annual budget deficit, national debt, income inequality, reducing benefits and raising income taxes by both candidates – I’m surprised neither party ever mentioned eliminating the capital gains tax subsidy by returning the capital gains tax to the income tax rate. It’s a logical option. Why should the profits made on investments be taxed SO MUCH LOWER than income earned through hard work? It’s a huge tax subsidy given to those who need it least and whose corporations use our government funded infrastructure the most – paid for through the courtesy of the rest of us.

Other options for raising tax revenue like adding sales taxes or a value added tax (V.A.T.) will always be regressive – that is – hurting those made poor who must spend nearly all of their earned income. Likewise raising earned income tax rates hurts those made poor rather than those who are over privileged (i.e. the rich) who don’t actually earn income, but receive money from profits on investments.

Those who have the luxury of living off their investments can most afford to pay more in taxes. Eliminating the capital gains tax subsidy by increasing capital gains tax rates is a logical way to increase revenue from the group most able to pay it.

I’m not the only one who thinks so – read more here and from a recent Washington Post article here.

But ask yourself, “Why is raising the capital gains tax rate never discussed as an option?” “What happens when our government representatives are over privileged elites who consistently vote in their own interests and in the interests of their biggest campaign financiers rather than considering the common good?”

Next up: Another way to reduce the deficit that presidential candidates never mention.

You may also like Luck or Privilege? and Myth of Objective Reporting.

Theology and Consumerism

Photo DesktopNexus.com

Photo DesktopNexus.com

I’ve not posted too much lately because I was asked to teach a J-Term class at the university where I work (think one month, January, fifteen weeks crammed into 18 days!). The course was on theology and consumerism. “What’s the connection?” you might ask. Well . . . everything. How we see God – loving, compassionate and present within each person, for example – influences how we make decisions regarding everything we buy or whether we buy anything at all.

For Christians (and others too) we believe there is an inherent responsibility to consume less in order to relieve the stresses caused by carbon and waste to our planet. There is concern for the 23 million human beings enslaved worldwide to produce cheap goods for industrialized countries. I live in an urban area (Twin Cities) that is sadly one of the centers of human trafficking in this country. Finally, there is a concern about the inhumane treatment given to many of the animals we consume.

In many ways this seems too overwhelming to consider. And yet we have a moral responsibility to do exactly that. However, education and changes can be made slowly over time. It’s a process that is on-going. Choosing to live more simply is a great way to start. It is a way to use less, take care with what is actually used and frees time to learn more about what and how we consume.

So this was the topic of the course. The students were engaged, thoughtful and brought excellent suggestions and ideas to their discussions. I am always amazed at how much young adults are already doing to learn more, help others and the earth. They are inspiring for sure! They inspired me most definitely!

How many planets would it take to support your lifestyle? Here is one of the links a student highlighted that calculates what our lifestyle choices mean for our planet. Get started. Click on the map and find out if you should consider living more simply.

You may also like Bottled Water? Yuck! and Earth Day.

 

Tired of Same Old Movie Th[M]emes?

During the holidays, I saw a couple of newly released movies at the theater. The most recent one was Les Miserables. Now this is a classic story that I enjoyed seeing years ago as play. However, this time around I couldn’t help but think how tired I was of viewing the same old plot line that exists for too many movies. It goes like this: systemic injustice (for example vast wealth inequality in 19th century Les Mis and today too) creates horrific suffering which is then personally alleviated for a few characters by one over-privileged white male who saves – pick one – his family, the United States or planet earth.

Hollywood clearly knows about the underlying systemic abuses and injustice that causes so much of the suffering in the world. But then Hollywood too often misses the point: one person alone will never change systemic injustice. The “one person will save us fantasy” – is just that – a fantasy. It’s particularly a fantasy when that one person is a white male, since patriarchy (men having power over women, children and people of color) is the root cause of the wealth inequality, discrimination and abuse in the world.

Worse, believing this fantasy short circuits our motivation to do what is really necessary. Each of us is part of the human family and each of us has a responsibility to work for long term change. Real changes in the way we provide for basic needs, distribute resources and care for those who are vulnerable requires a community willing to use all its imagination, empathy and creativity.

Why can’t Hollywood use their abundant resources, ingenuity, creativity and imagination to highlight real and useful systemic solutions for the poverty and abuse that we see in our local communities, on our continent and around the world? Possibilities and opportunities for solutions exist. They are many and often easily accomplished. Examples abound. Why not build powerful stories around these ideas?

Unfair By Design

Americans are notorious for not wanting to look at the systemic problems underlying many of our social ills. For example, we’d rather believe that if we vote for the right politician or political party our problems will be solved – rather than tackle the underlying systemic problem of campaign finance reform and lack of term limits that keeps politicians of both parties beholden to big financial, military and corporate interests. Far easier to turn politics into a competitive sport where we pick a political party more or less like a sports team and cheer for our side to win.

We’d rather tell ourselves that charities should take care of those made poor and those who struggle with health problems or tragedies, rather than look at the huge wealth transfers (regressive rates, deductions) for the middle class, elites and corporations designed to take wealth unfairly from others. Wealth transfers are designed into our tax code. They can be designed out as well.

We’d rather think that millions of home foreclosures were due to the personal failings of homeowners rather than the predatory lending practices, high risk hedging and multi-trillion dollar bail-outs of the too-big-to-fail-banks encouraged by the repeal of banking regulation laws. This mortgage boom-bust was designed by lawmakers acting in the interests of the financial industry.

We’d rather tell ourselves that tolerance and warm feelings toward people of color will solve systems of white privilege and racism, rather than face and dismantle the wealth-transferring discrimination built into our legal, educational and corporate systems.

Many work for or against legalizing marriage for all, rather than acknowledge that systemically, the social benefits assigned arbitrarily to those who are married could and should be made available to all, independent of marital status, and how conventional marriage creates poverty for women and children by design.

Others want to believe that raising the eligibility age for social security or medicare is not the same as privatizing them (meaning giving all the attendant fees and insurance dollars to corporations) when it is exactly that. Health care, like clean water is a basic human right. Without adequate social safety nets crime, corruption and violence will radically increase in our society. Not a country or a world I want to live in.

It’s no different for religious institutions. Within the Catholic church, for example, many feel that ordaining women will solve the governance problem in the church. But it is the ordination system itself that allows for one voice to trump all within a community. Those who are ordained in this system are formed in such a way that they are predisposed to elitism, privilege, self-focus with no accountability. This creates a situation that fosters corruption and abuse. Lack of financial transparency within the church similarly promotes unethical and immoral behavior. Ordaining women will not change these fundamental flaws designed into this system.

Our refusal to look at or discuss underlying systems persists because doing so would take time, require self examination and is complex. It’s easier to focus on personal charity, personal spirituality or personal failings of high profile individuals. But this is to fail ethically and morally because we are all interconnected and interdependent. We either work to transform unjust systems or we are part of the corruption.

Refusing to learn about systemic injustice makes us morally culpable. There are no easy answers or quick fixes. However, this doesn’t mean that we shouldn’t endeavor to work for systemic change. We’ve had the moral courage and tenacity to make systemic changes in the past (ending slavery, women voting, environmental laws, human rights, etc.). A better future for everyone requires it.

You may also like Time to Tax Wall Street and True Freedom.