It's clear the national Republican Party has a singular goal of preventing Barack Obama's re-election, which translates to doing nothing that will restore the national economy through 2012. Republican members of Congress are positioned to obstruct Obama administration attempts to restore economic health, and have demonstrated that is their tactical plan.
The strategy is obvious. Any economic gains for which the president can take credit will work against the eventual Republican candidate for president. There is no advantage for Republicans to promote jobs in the current political scenario, but they can use the lagging economy to challenge the president's policies and leadership.
The strategy can succeed. The argument that federal taxation is a cause of economic malaise has rooted, bolstered by populist Tea Party anti-government rhetoric that is long on emotion and short on fact and funded in large part by corporate executives who continue to build personal wealth even as the national economy founders.
But the wealthy elite in the United States owe little to the country when they are thriving in the global economy and federal tax policies allow their corporations to continue to do well - and to position their businesses to curtail labor force demands.
A recent study by the Institute for Policy Studies notes that 25 of the 100 highest paid executives of American corporations received more than their corporations paid in federal income taxes - averaging incomes of $16.7 million. Offshore accounts are a factor, but there also are credits and deductions allowed by federal tax law providing refunds to the corporations ("Executive Excess 2011," Aug. 31, 2011, Institute for Policy Studies, www.ips-dc.
org).
This is while the Tea Party constituency adamantly opposes raising income tax rates on the wealthiest Americans, relying on the fiction that taxing wealth discourages the wealthy from investing in the U.S. economy - all based on a faulty presumption that the wealthy care about the welfare of lower income Americans.
Attitudes are detailed by writer Chrystia Freeland in a dissertation on the widening income gap in America, "The rise of the new global elite" (The Atlantic, January/February 2011, www.theatlantic.com).
She reports a statement by Thomas Wilson, CEO of Allstate at the Aspen Ideas Festival: "I can get (workers) anywhere in the world. It is a problem for America, but it is not necessarily a problem for American business . . . American businesses will adapt," Wilson is quoted.
"Wilson's distinction helps explain why many of America's other business elites appear so removed from the continuing travails of the U.S. work force and economy: the global 'nation' in which they increasingly live and work is doing fine - indeed it's thriving," Freeland says.
Federal tax policy may be an issue, but not for the wealthy. A Tax Policy Center report notes: "More than 90 percent of the tax savings from preferential tax rates on long-term capital gains and qualified dividends go to taxpayers in the top quintile (top fifth) of the income distribution, and nearly half of the benefits go to people in the top 1/10th of 1 percent" ("Who benefits from tax expenditures?," Tax Facts, May 2, 2011, www.taxpolicycenter.org).
The Tax Policy Center also reports middle-income Americans - with annual incomes of $40,000 to $75,000 - had a 3.9 percent increase in net income from the 2003 tax cuts. Americans with incomes of $500,000 to $1 million had a 5.1 percent increase in net income; those making more than $1 million saw their net income increase 8.5 percent (Individual income and estate tax provisions in the 2001-10 tax cuts/Table T11-0205; July 5, 2011).
The wealthiest Americans have had eight years to reinvest in America since the Bush tax cuts were implemented. Rather than promoting growth, the 2003 tax cuts promoted fraudulent investment schemes that led to job losses and economic collapse.
* Edwin Tanji is a former city editor of The Maui News. He can be reached at hakumoolelo@earthlink.net. "Haku Mo'olelo," "writing stories," is about stories that are being written or have been written. It appears every Friday.
