The Fairness Election

Author: Gary Hart

Law students learn very quickly that the law is about what is and is not legal (and mostly about all those cases that don’t fall clearly into either neat category), but that there is another parallel system for governing society that is called equity. In some jurisdictions there are even separate court systems—chancery courts—that are concerned with cases of equity, what is fair and what is not fair.

All this has to do with the question of a slightly increased tax rate on high earners as part of a budget compromise between the White House and Congress. Two facts need to be clear. One is that the taxes in question have to do with resumption of previous statutory tax rates before the temporary Bush tax cuts. The other is that resumption of the pre-Bush tax rates would apply only to income above $250,000 annual income.

In other words, President Obama’s is insisting that temporary tax reduction continue for all income up to $250,000 annually, but that the tax rate on income above that amount be taxed at the original rate—one of the lowest in the developed world—before the temporary tax cuts. This proposal affects no one in the 99%.

There is no evidence—none—that so-called “supply side” economics works, that cutting taxes produces new investment and new jobs that create revenue to make up lost revenue from the tax cuts. None. So the supply side disciples and the anti-tax Norquistians, are now faced with unacceptable budget deficits. They are in a box and can’t escape. They either want to reduce deficits, in which case everyone agrees new revenues are required, or they want to continue to worship at the No-Tax Church and let deficits soar.

Let’s be honest about this. Those opposed to fair taxes simply resent paying for programs that they don’t like—mostly the social safety net. But pacifists don’t like paying for expensive weapons systems. This isn’t about “big government.” This is about paying for a government produced by a democratic political system.
No one argues that resumption of pre-Bush tax rates on the wealthiest 1% will solve the deficit problem. What we do argue is equity—fairness. The entire idea of progressive taxes is that those who benefit the most from our nation’s services should pay a fair share.

A sense of equity, of fairness, is central to democracy. When everyday citizens become convinced, as many today are, that the wealthy and powerful are receiving favorable treatment, the system breaks down because citizens lose confidence in government. Both Occupiers and Tea Partyers agree on this. When fairness rules were suspended in the first decade of this century, a handful of speculators made billions and the economy collapsed.

Insistence that the 1% resume a slightly higher rate on income over a quarter of a million dollars (and much of that income is protected by very favorable capital gains rates) is necessary if we are to justify, as the President has pointed out, reducing government programs for the poor, for the elderly, for students, and for working people.
Americans are often justifiably skeptical about our government favoring the powerful who have access to the political system. That skepticism becomes dangerous cynicism when their suspicions are proved right. Despite the cries of anguish from Wall Street that “Obama doesn’t like business”, the wealthy and powerful do have access in Washington that everyday Americans do not. And they use that access to their benefit.

We either restore equity to our politics, or confidence in government will continue to decline to the peril of our Republic.

One Response to “The Fairness Election”

  1. Bill Pruden Says:

    This post is yet another unhappy reminder of how far we as a nation have strayed from our roots. The issues of fairness and equity that Senator Hart raises are central to what the United States is supposed to be about. From “all men are created equal” to “we the people,” there has historically been a shared bond among the American people. Yes, there was much about the Founding Fathers that was undemocratic by the standards of the day, but they had the foresight to expect and provide for changes and their core principles reflected a distinctive commitment to justice and equality. We must return to and stay true to those roots, not in the originalist sense that Justice Scalia speaks of, but rather with an eye to the spirit that fueled the Revolution, an effort from which emerged a nation that was as Lincoln put it “last best hope of earth.” We must recover and revive that spirit or that hope will vanish.

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