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GUEST OPINION: Use vote to halt widening of wealth gap

By MARTIN J. BENNETT

With the fall elections upon us, Californians are reeling under a weak recovery, enduring both historic levels of income inequality and the most severe fiscal crisis in recent history. To address the crisis we must have some common sense remedies: raise taxes on the wealthy and build a movement for a fair and more equitable tax system.

Income inequality has exploded over the last two decades in both the nation and California. UC Berkeley economist Emmanuel Saez has documented that the share of national income received by the upper 1 percent more than doubled from 9 percent in 1979 to an astonishing 23 percent in 2007. The richest 1 percent raked in a staggering 60 percent of the national income gains over these three decades, while the bottom 90 percent received just 9 percent.

Martin J. Bennett.

In California, according to the California Budget Project report titled “A generation of widening inequality,” between 1987 and 2009 the average inflation-adjusted gross income for the upper 1 percent increased by 50 percent to $1.2 million, while the average incomes of the poorest fifth decreased by 20 percent. The second fifth decreased by 17 percent, and the middle fifth declined by 15 percent to $35,400.

The wealthiest Californians are grabbing an ever-larger slice of the pie compared to the bottom 90 percent. The Budget Project report indicates that between 1987-2009 the top 1 percent of Californians received more than one-third of the income gains, and the top 10 percent received three quarters.

At the bottom, working people in California face extreme hardship and cannot make ends meet. According to the Public Policy Institute of California, 16 percent of California families were in poverty in 2010, and 36 percent, the working poor, earned incomes of less than $44,000 annually. That’s the minimum amount required for a family of four to pay for basic needs such as shelter, food, health care, transportation and childcare.

Despite the stunning growth of their incomes, the upper 1 percent of California’s income earners pays less state personal income taxes than they did two decades ago; and since 1981, state revenue from corporate income taxes has declined by one-half.

Overall, the California state tax system is modestly regressive. Measured as a share of family income, when all state and local taxes are combined (including personal, property, sales and other taxes), low- and middle-income California taxpayers pay proportionately more taxes than the upper 1 percent.

Isn’t the need for more revenue from the wealthy obvious? The state budget deficit is now as much as $16 billion, and Proposition 30 on the Nov. 6 ballot will raise $8.5 billion in new revenues in 2012-2013 by boosting the personal income taxes on the wealthy for the next seven years to pay for public education and public services. The ballot measure also includes a quarter-cent temporary sales tax hike that will affect all Californians. On balance, the top 1 percent of taxpayers, whose incomes ballooned to $1.7 million in 2012, will pay nearly 80 percent of the new state tax. The typical California taxpayer will experience only an annual $24 aggregate sales tax increase over four years.

The proposition is the most progressive tax increase in recent California history — but it is not a cure-all. It’s really just a first step toward a more equitable tax system. Proponents intend to propose new ballot propositions each election cycle to completely overhaul how the state raises revenue.

During the Great Depression in the 1930s, President Franklin D. Roosevelt declared, “our revenue laws have operated in many ways to the unfair advantage of the few, and they have done little to prevent an unjust concentration of wealth and economic power.” Roosevelt’s landslide re-election in 1936 indicated a value shift in American culture and popular support for public policy to address economic inequality and to regulate big business and large financial institutions. That’s the kind of shift in values we need today, and approval of Proposition 30 will indicate we’re making it.

Martin J. Bennett teaches American history at Santa Rosa Junior College, serves as co-chairman of the Living Wage Coalition and is on the Leadership Council of the North Bay Organizing Project.





27 Responses to “GUEST OPINION: Use vote to halt widening of wealth gap”

  1. Kris says:

    Fair taxes gang is the price of civilization. Do we need to cut some expenses, yes, but the widening gap between the 1% and everyone else has to be addressed and this measure whether Romney wins or not will help California get it’s balance sheet in order.

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  2. Skippy says:

    “I find “common defense” and “general welfare.”

    Keep looking.
    The People are mentioned prominently a time or two.
    Remember to look at the U.S. Constitution, not some collectivist screed.
    Start anywhere you see the words “the right of the People shall not be infringed”.

    Thumb up 3 Thumb down 1

  3. Skippy says:

    “The modern political democratic traditions and constitutions came right out of the French Revolution.”

    Note that the French Revolution, which occured after ours, is always the conflict leftists refer to when making their thinly veiled threats of violence.

    “MMMM sound familiar… I would be careful with insults.”

    Bring on the guillotine, Bob.
    This time you’ll need more than pitchforks and torches.
    A well regulated Militia, being necessary to the security of a free State, the right of the people to keep and bear Arms, shall not be infringed.
    Occupy this.

    Thumb up 4 Thumb down 1

  4. Juvenal says:

    @James Bennett

    “Instead of rewarding and paying homage to the INDIVIDUAL, like our founding principals outlined.”

    Which founding principles are those, James? Poring over a document which lays out our founding principles, I find “common defense” and “general welfare.”

    Thumb up 1 Thumb down 4

  5. Snarky says:

    WARNING:

    The Sacramento Bee is reporting some fine print on Prop 30 that you might not be aware of and that the Press Democrat is avoiding….

    Prop 30 INCREASES TAXES retroactively to the beginning of this year.

    Unless you vote “NO” for Prop 30, you will be increasing your own taxes for all of year 2012… and then thereafter.

    Vote “NO” on Prop 30. Let the government parasites cut their budgets rather than cut YOUR family budget.

    Thumb up 4 Thumb down 2

  6. Follower says:

    Clearly…
    The solution to the problem of the increase in poverty is to make poverty more comfortable.

    Thumb up 1 Thumb down 0

  7. Bob says:

    Just a short history lesson for the greed mongers that think they can just insult their way to equality in this country. The modern political democratic traditions and constitutions came right out of the French Revolution… so why did it happen. 3% of the French people (the aristocrats and church )had 99% of the wealth. MMMM sound familiar… I would be careful with insults.

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  8. Paul Andersen says:

    The top tax rate in 1945 was above 90 percent, and fell to 70 percent in the 1960s and to a low of 28 percent in 1986. The top current rate is 35 percent.

    The tax rate for capital gains was 25 percent in the 1940s and 1950s, then went up to 35 percent in the 1970s, before coming down to 15 percent today – the lowest rate in more than 65 years.

    All these arguments on taxing the rich sound like the same doomsday scenario that was envisioned in 1993. But instead we had the longest peacetime economic expansion in our history.

    It wasn’t until the Bush tax cuts that the debt ballooned.

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  9. I loved flying through here clicking thumbs down,thumbs down, thumbs down, just loved it. Had to come to a screeching halt for: MockingBird and Bones. Commonsense brought up some good points too.

    Thumb up 3 Thumb down 9

  10. Robert says:

    Just vote NO on ALL new taxes and bonds!

    Thumb up 9 Thumb down 3

  11. James Bennett says:

    Jim: THAT is the communitarian, collective, socialist, social equity, greater good crap that this ideology (Agenda) imposes.

    Instead of rewarding and paying homage to the INDIVIDUAL, like our founding principals outlined.

    Paying public servants to reduce our society to an “ISM’.

    Nice.

    Thumb up 15 Thumb down 4

  12. Ricardo Sorentino says:

    Did you read the article ‘Jerry Brown urges student vote for tax measure, $250 refund’? Almost sounds like Gov. Brown is buying votes…

    http://blogs.sacbee.com/capitolalertlatest/2012/10/jerry-brown-urges-student-vote-for-tax-measure-250-refund.html

    Thumb up 16 Thumb down 4

  13. Commonsense says:

    Ok, since when is a family or individual earning $250,000 annually before taxes a millionaire??? Really, I thought a millionaire was someone who earned $1,000,000 or more. $250,000 is frankly middle class in this area IMHO. I think Jim is spot on in both of his posts, and I’d take his second even a little further and say that even if you have two students who work equally hard, one gets 98 and the other gets a 80. It’s still counter-productive to “even out the scores”. Everyone is different, with different talents and skill sets and differing amounts of drive and ambition. People with high amounts of both may still not suceed financially, although they may be quite content anyway. Since when does a society and culture based on opportunity, choice and freedom become the judge of who gets what. I don’t want handouts from the haves, I want what I earn. I’m not middleclass because someone else is rich. BTW, tax reform is a great idea in many areas, such as deductions, as long as it goes both ways. I know many, many “poor” who are much better off in many ways then I am. They receive large (thousands of dollars) tax refunds both from the State and Federal government each year based on their income levels and dependents (Often not reported correctly), and they all still eat well, have cars, iphones and cable tv. They also receive many other forms of government assitance yearly. I’m all for safety nets, but lately between tax “refunds” and government programs, the safety nets are now just ways of life that afford them a lot more time with their family then I get working full time, while their income from all of the above is more then enough to support a pretty comfortable living standard similar to mine in a majority of ways.

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  14. Skippy says:

    “Vote Yes on 30 and THEN let’s raise hell to get the ship in shape.”

    Just one more hit, man.
    I just gotta have one more and then I swear I’ll get sober.

    Taxaholic.
    Admitting we are broke is the first step.

    Thumb up 16 Thumb down 4

  15. Jim says:

    @Bones…

    Prop 30 does not provide money to the schools. The money collected will go into the General Fund. General Fund money is wasted by the government.

    What do movie discounts have to do with “benefiting from the system”? Movie theaters are private companies who are allowed to provide discounts to whomever they want. Going to state college isn’t considered when getting a movie discount.

    The younger generation is struggling with what? The lousy economic condition in this state and most of the country? How does increasing taxes help these “struggling” people? Do you honestly believe that the government taking from someone who earned it and handing it out through bloated, wasteful programs administered by overstaffed, redundant government departments helps someone?

    Think about this…your oldest kid busts his hump in hopes of getting accepted into a good university. He earns a 95 in Calculus through hours of studying. His classmate also wants to attend college but doesn’t study at all. He gets a 65. TO BE FAIR, the teacher TAXES your son’s grade by 15 points and redistributes it to the lazy kid through the Fair Grades For All policy (voted in by the parents of kids who don’t believe it is fair that kids who bust their hump and EARN high scores should keep all of the points). Both your son and the lazy kid end up with an 80. Now everything is FAIR.

    Would such a policy make your son want to bust his hump to get a 98? Or would it lead to your son cutting back on his studying to goof-off more?

    Now, let’s tax those “millionaires” who are earning $250,000/year. Yes on Prop 30! Yes on every new tax!

    Thumb up 15 Thumb down 3

  16. Jim says:

    Please explain to me how the government taking more money from those who earn it addresses the “widening wealth gap”?

    The figures states relate to “wealth” and “income”. Taxing the higher earners doesn’t increase the “wealth” or “income” of those who are deemed “poor” by the author. Handouts aren’t taxable income. Handouts don’t lead to wealth creation. What is Mr. Bennett talking about?

    As for the CEO vs the worker argument, the CEO pay includes stock options and bonuses. On a straight salary basis, the figures aren’t what the Redistribution Party claim. Steve Jobs paid himself $1. Many CEOs don’t earn a salary. Around this same topic, why is only private sector pay criticized? The former Chief of police in San Francisco is making 42% more in retirement than she ever made while working. Many, many government workers make obscene salaries while ‘earning’ lifetime retirement pensions, all while every government is facing the budget deficits Mr. Bennett mentions. The answer is to tax those in the private sector to pay for the ever growing deficits created by overpaid unnecessary government workers, unnecessary government departments and ineffective government programs?

    How does taking from the private sector to pay for ever-growing government deficits help the “working poor”? That question is NEVER asked. Mr. Bennett, will you answer that?

    Government handouts never lead to increased wealth. This is a fallacy pushed by the liars in the government to justify the theft from the earners to buy votes, keep people dependent and pay off the unions. Handouts interfere with a person’s drive to make something happen for themselves.

    When I lost my job due to the financial collapse, I made sacrifices – cut cable, reduced cell phone bill, sold my car, sold unnecessary stuff, got a roommate, etc. I eventually found a job (making 40% less money) and then enrolled in school to enhance my value in the job market. ANYONE, A-N-Y-O-N-E, can do this. Ever expanding government handouts lead many to sit around and wait for something to happen rather than making something happen.

    Again, taking from those who earn to expand the government and pay for their waste isn’t the answer. There isn’t enough money to steal from the private sector to cover the billions upon billions of waste.

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  17. Bones says:

    I am pushing 50 and will have 3 kids in college very soon. I know that many folks in my generation and before were able to afford our state colleges (state and UC). Now I see many folks 60+ who benefited from this system, receiving discounts at movies and elsewhere, while the younger generation is struggling. This seems so wrong.

    Of course we need to always improve our vigilance on spending. But don’t penalize the current young generation that is trying to get educated so they can be our future doctors, mayors, teachers, etc.

    Vote Yes on 30 and THEN let’s raise hell to get the ship in shape.

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  18. James Bennett says:

    BTW: Since it’s a state issue, let’s use the money for the “High Speed Rail”.

    $100. BILLION is how much it will end up taking.

    Who knows how much the actual job will cost. That number is how much they will probably take.

    Wait ’till you see how many important things get cut before they defund this tyranny.

    Thumb up 24 Thumb down 6

  19. James Bennett says:

    When the music is playing for a socialist dance, socio-economic devide is the beat.

    I got a smart idea.

    Use the money from their dumb train.

    Thumb up 20 Thumb down 6

  20. MOCKINGBIRD says:

    Wow, what a bunch of whiners. I guess you all have yours and don’t want to share. Of course, you have it wrong. The more you get paid the better you can support your community and stimulate local businesses. So a living wage makes sense any way you look at it.

    The fact that the wealth is now concentrated in the top 1% seems to escape you. It didn’t used to be that way. Your pensions and benefits are up there in that wealth along with full time SECURE jobs with benefits and support for small middleclass businesses. And yet you whine that they just don’t have enough. You whine that they are the job creators, only they aren’t creating jobs they’re hoarding their money and hiding it in offshore accounts so THEY don’t have to pay their fair share taxes. That comes off the middleclasses’ backs, your backs.

    Wouldn’t it be nice to be paid your fair share for you productivity? Instead CEOs now make 400 times you do and still often do a crappy job.

    There’s plenty of money to create jobs and for the rich to share with the producers. And yet you all attack your fellow working stiffs as the moochers instead on focusing on the real issues.

    Then go out an vote for the biggest moocher on the middleclass, Mitt Romney, who is STILL making money from jobs going overseas and profited in the millions from the auto bailout. Look up DELPHI/ROMNEY and see. WHAT HE’S DOING TO THE AMERICAN WORKER IS NOT OKAY.

    Thumb up 6 Thumb down 25

  21. Beef King says:

    It is unfathomable to me that this Marxist is paid by our tax dollars to butcher American history to our students for a living.

    When the will the local Progressive Marxists be removed from power?
    Let’s start one candidate and one proposition at a time.

    If Bennet is for 30, it is undoubtedly one of the worst things that could happen to California students and the citizens who love them.

    Thumb up 35 Thumb down 11

  22. m whitt says:

    This is Institutionalized Thinking and teaching from one who has sucked off the taxpayers’ teat all his life.

    Thumb up 36 Thumb down 11

  23. Snarky says:

    The local, state, and federal governments are already an out of control monster that has destroyed our society by stealing our money and spending it upon their public employees.

    You all saw the sniveling former police chief of Bell, CA, the other day demanding that his public employee pension get doubled from over $200,000 a year to over $500,000 a year.

    Before that, you saw his criminal buddy engaging in a criminal scam to not only give himself a half million dollar public pension but when the investigation totaled up the scam, that public employee was raking in over a million dollars a year in wages and benefits… with YOUR tax money.

    Or, how about that cop on trial for beating an un-armed homeless man to death about 6 months ago in Fullerton, CA? Did you hear that the cop, working full time as a cop, was already collecting a “dis-ability public pension” from the Los Angeles Police Dept equal to 70% of his LAPD pay? Yeah. That guy sounded “dis-abled” didn’t he?

    The income “in-equality” that has come about in our society is directly related to the criminal government who steals from us & gives to themselves.

    Vote “NO” on Prop 30 … and watch the government employee freaks scramble to try and hide even more criminal activity that they have engaged in with YOUR tax money.

    Of course… we won’t even discuss how the Feds are finding a new foreign war every six months to drag us into so that they can send YOUR kids to die… while their government kids can sit around the USA and stay safe.

    Thumb up 29 Thumb down 11

  24. farmer west says:

    Mr. Bennett makes some interesting comments, first he wishes to have lived in the 1930′s second is a shift in the way California does business.

    California needs to cut spending big time.

    Neveda has no income tax, we need to figure out what they are doing right and copy them.

    Raising taxes is not the answer.

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  25. John Pendergast says:

    When there’s not enough pie to go around, shoot the baker!

    I think we can save money by getting rid of a lot of crack pots at our Junior Colleges.

    We need more bakers and less community college professors/organizers flapping their gums on the government dime. By the way, the world has had Marxism for over 120 years, shouldn’t it have worked by now?

    Thumb up 36 Thumb down 12

  26. Frank says:

    state revenue from corporate income taxes has declined by one-half.

    could be a clue here no more taxes on the middle income
    http://www.calwatchdog.com/2012/10/24/the-evidence-still-shows-california-exodus/
    vote no 0n 30
    Get rid of the SWRCB, CARB, no on Huffman

    Thumb up 27 Thumb down 7

  27. Jerry Summerfield says:

    The liberals cry more taxes, more taxes, make the rich pay! Well, that has been tried here in California for many years and the end result, a $16 or $17 billion dollar state budget deficit.

    The corrupt politicians in Sacramento always think only about spending, not cutting the budget. That is the bottom line. Prop. 30 will only give Sacramento more tax money to spend. Budget balancing or cutting will never enter the equation.

    When Sacramento learns to live within a budget just as we the state residents do, things will change. The problem is Sacramento is spending other peoples money and so it is no body’s money, it is just theirs to spend at will.

    The articles author is just living in la la land in his little academic world of what ifs.

    Thumb up 30 Thumb down 9

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