Washington Has Class On Its Mind

I beg your forgiveness but it is impossible to get a handle on what is happening in Washington without talking about class. And I don't mean the Cary Grant kind of class. Last November Republicans gained control of Congress not because of a massive change in voter sentiment but because the rich came out and the poor stayed home. The 1994 elections attracted some 7 percent more wealthy voters and 7 percent fewer poor and working class voters than the 1992 elections. That shift in voter turnout was enough to give Republicans control of that part of government that controls taxes and spending. And since January, on both the tax and spending side of the equation, the Republican Congress has been rewarding those who voted for them and penalizing those who didn't. High on the Republican hit list has been the elimination of the Democrats modest 1992 increase in taxes on the super-rich. Its not as if the rich were feeling any pain from this tax hike. The average after tax income of the richest 1 percent of the country had risen during the 1980s by over $130,000 75 percent. Meanwhile the average after tax income for the rest of us actually fell. Nevertheless, the Contract With America promises to reduce taxes on someone earning over $200,000 a year by more than $15,000. For someone earning $40,000 a year the Republicans are offering a $37 a year tax break. Republican will reduce capital gains taxes and index them. Indexing means the rich will be taxed only on the inflation adjusted value of their assets. If a stock doubles in value but the consumer price index also doubles, one pays no tax. Republicans justify this proposal on the basis of fairness. But they are unwilling to extend that kind of fairness to those who did not vote for them. Consider their attitude toward the earned income tax credit(EITC), enacted under Gerald Ford and warmly supported by Ronald Reagan. The EITC reduces taxes, or gives an outright grant, to workers whose wages are below the poverty level. According to the Urban Institute, the EITC will lift about 4.5 million Americans above the poverty line in 1996. The EITC is indexed. Republicans want to eliminate indexing in this case and slash benefit levels. As for the minimum wage itself, which has shrunk in earning power by one third in the last 20 years, Republicans are against indexing. Indeed House Majority Leader Dick Armey(R-TX) wants to eliminate the minimum wage. Different strokes for different folks. About 700 very rich Americans renounce their citizenship each year to avoid paying taxes. Early this year President Clinton proposed to tax these selfish chaps as they left our shores. House Republicans refused. Some were downright sympathetic with the turncoats. Representative Mel Hancock(R-MO) argued that if the U.S. had a reasonable capital gains tax and a reasonable estate tax, these people wouldn't have any reason to leave in the first place. Multimillionaires as victims. The Republican view. And then there's Armey's flat tax proposal. Armey would exempt all income from investments. Anyone earning their money from stocks and bonds would pay no taxes. Those of us who earn our money the old fashioned way, by working for it, would have to carry an increased load. A New York family of four earning $45,000 a year would find its tax bill increased by $4,500 according to the Citizens for Tax Justice. On the spending side of the equation, the Republican party is equally generous to its backers and stingy to its opponents. A recent study by the Orlando(Florida) Sentinel geographically linked $1.2 trillion in federal spending to the nearly 70 million votes cast in the 1994 congressional election.The paper found that those counties that voted Republican (that is, the wealthier, whiter counties) were favored while those who voted Democrat were penalized. Eagle County, Colorado, for example, includes the affluent Vail ski resort. The County voted 70 percent Republican. Vail isn't concerned about Washington's cutting programs for the poor or the working class. Vail's biggest worry, according to the Sentinel was that it might lose federal money to expand the airport runways, crowded with private and commercial jets. It need not be concerned. The House budget slashers actually increased the budget for airports by $230 million. Cobb County Georgia, House Speaker Newt Gingrich's district will do even better. Cobb County receives only $996 in per capita income from all safety net government programs that will be cut: Medicaid, legal aid, college loans, job training and education, food stamps, Head Start and welfare. On the other hand the County receives $6611 per capita in military spending. The GOP will increase military spending by some $15 billion. The House voted to continue funding the $72 billion Stealth fighter aircraft program, a program that virtually no one in or out of the military can any longer seriously defend. The Stealth is built by Lockheed Martin, located in Cobb County. A few weeks ago the Charleston Gazette editorialized, When you look at the Republican budget plan, its obvious which party has declared class warfare and which class they have declared it on. The poor and the working class stayed home in 1992. Actions have consequences. As Senator Graham declared, I think they're getting a lesson now that politics makes a difference. Yes Virginia. Elections do matter.

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