Thom Hartmann, 1/14/21
Hint: It’s all about the money
Some very wealthy people helped put Donald Trump in office, and have continued to subsidize the Trump presidency and those Republicans who enable it.
Why would they do this? Why would they play such a horrible game of Russian Roulette with the United States of America and its citizens?
Why would they take such a chance on destroying democracy all around the world by helping flip it’s most iconic Founder, the international role model for democracy in a republic of laws, into oligarchy and strongman rule?
Is it possible they did this not out of ideology (even though a majority describe themselves as “conservative“ or “libertarian“), but because they have a common interest that Trump and the GOP could help satisfy by maintaining, and, from their point of view, even improving, the status quo?
Sadly, like the old cliché, with rightwing billionaires like Trump, “It’s all about the money.” Here’s how it works:
There are two ways to become a very wealthy person in the United States: earn that money or inherit/marry it.
A substantial percentage of American rightwing billionaires have inherited or married their money.
And the billionaires who did earn their money are, literally every day, creating children and spouses who’ll be future billionaires who simply inherited or married their money.
Thus, Statisia noted: “The number of billionaires in the U.S. has increased tenfold during this time [1987–2012], from 41 billionaires in 1987 to 425 billionaires in 2012.” Today there are over 650 billionaires in America.
Of course, some of this growth in the number of billionaires since 1987 has to do with inflation, but not the majority of it. Which raises the question: “What is it about Trump and the Republican Party that makes rightwing billionaires so supportive of them?”
Not surprisingly, it’s all about the money.
There are two ways our government taxes the income that sustains people in America, whether they live in the suburbs or a palatial mansion with 150 servants: income taxes and capital gains taxes.
Wages are what you get when you employ your body or mind, and are paid for that effort. Dividends and interest are what you “earn” when you make your living by sitting around the pool waiting for the dividend checks from your investments to arrive every month.
Working class people earn wages and pay income taxes; people who inherited or married their money, and those who invest their vast fortunes, pay capital gains taxes on the money their money earns.
Wages are taxed at a substantially higher rate than capital gains. Donald Trump, in fact, lowered the capital gains tax and promised to lower it all the way down to 15% if he remains president after January 20.
Thus, those who inherit or marry their money pay the lowest income tax rate in the United States. Rightwing billionaires want to keep it that way, and Donald Trump promised them he will.
After all, it’s all about the money.
Similarly, there are two ways to pay taxes on your wealth, the stuff you own as opposed to the income you earn.
Working-class people, a majority of whom are homeowners (around 66%), pay an annual tax on their greatest source of wealth, their homes. It’s called the property tax.
Every single year over 87 million working-class homeowners pay a small percentage of the value of their main store of wealth — their homes — to the state.
It’s a wealth tax for the middle class that we refer to as a “property tax.”
Even people who rent pay “the working class wealth tax,” through their rent payments, which subsidize their landlords’ property taxes.
But what about people who’ve inherited or married their money, or even earned themselves billions, and put it in investments?
The majority of their wealth is not in their home(s); that usually represents only the tiniest slice of their assets, even when it’s a big, fancy mansion.
Instead, most of their wealth is invested. Think of it as sitting in a money bin, like Scrooge McDuck.
How much of a tax is there on those money bins, their investment portfolios? How much tax do they pay every year on their wealth?
It turns out there is none. No tax. Nothing. Nada. Zip.
They don’t pay a penny in annual taxes on their invested wealth, and only a pittance on their overall wealth which includes their homes and land. Their homes, the only items on which they do pay a property/wealth tax, represent only the tiniest slice of wealthy peoples overall wealth portfolio.
Only working class people, whose principal store of wealth is their home, must pay a substantial annual wealth tax.
Fairness would dictate that money bins and investment portfolios face the same kind of wealth tax that middle class homes do, but elected Republicans oppose that and have promised the right wing billionaires they’re going to keep it that way.
It’s all about the money.
Meanwhile, Democrats are listening to Elizabeth Warren, who’s been calling for a “two pennies on the dollar” wealth tax on rich people’s money bins and investment portfolios to pay for a national healthcare system and free college education.
To further freak out this subset of greedy rightwing billionaires, many Democrats say they want to raise the top income and capital gains tax brackets for multimillionaires and billionaires back up to where it was between the 1930s and the 1980s.
The top income tax bracket was 74% when Ronald Reagan came into office, and that top bracket guaranteed that working class Americans saw their income and wealth rise at roughly the same rate as the very rich.
Reagan collapsed both income and capital-gains taxes all the way down to 25%, which kicked off 40 years of exploding wealth for the very rich, and absolutely flat wage growth, and a reversal in wealth, for working class people.
While there are many very rich people who realize how destructive this 40-year GOP policy has been to the economic, social and political fabric of America, the small number of right wing billionaires who’re fanatics about not paying their fair share of taxes have ignored these consequences and instead funded the Republican party in a huge way.
They’ve also spent the past 40 years setting up think-tanks nationally and in every single state, sponsoring Economics and Political Science departments in over 100 US colleges and universities, and flooding the internet with high-minded-sounding rationales for their greed.
Just google “middle class” and “tax” and you’ll see how many billionaire-funded rightwing sites pop up telling working class Americans that tax cuts for rich people are good for them.
In the process of pushing wages and wealth out of the pockets of working class people and up into the money bins of the top one percent, to the tune of $50 trillion dollars over the last forty years, these billionaires and the politicians they own have gutted the income, and stripped away much of the wealth, of the American working class. It’s tearing America apart, but their wealth has exploded by about a trillion dollars in the past year alone.
Because, for them, it’s all about the money.
Over the past decade or two, white working class people figured out they’re being screwed economically, but most don’t realize its connection to forty years of GOP tax policy.
Instead, they listen to Republicans like Trump and the millionaire stars on rightwing billionaire-owned media who tell them Black people, women and “illegals” taking their jobs are the reason they can no longer afford a home, a new car every couple years, a vacation, and to send their kids to college.
Thus, the current wave of white supremacist violence sweeping the nation finds its deepest roots in the economic destruction of the white working class over the last 40 years, and that mostly flows out of Reaganomics’ tax policies.
Multiple studies over the years have tied surges of racist violence to economic downturns. Economic crisis always drives the spread of racism and its corrosive effects on society.
From the founding of our republic to today, the core of racism has always been about the money. Slavery, for example, was 100% about the money, as is the rigged economy we’ve had since the end of the Civil War.
It’s time to repudiate Reaganomics and return America to a rational tax policy where the wealthy and extremely wealthy pay their fair share of the cost of maintaining a civil society. And to make up for decades of massive theft from the working class, it’s time to extend the wealth tax to everybody, including billionaires and their money bins.