Wake Up!

Cross-Cutting Conflicts Mask Class Divisions

A few weeks ago, an article appeared on line to talk about why baby boomers are hoarding their wealth instead of sharing it. I think that the article is mostly nonsense, but it is a symptom of something really important, which is the tendency of American progressives to split into cross-cutting groups along lines that prevent progressives from focusing on fundamental class conflicts. 

Young vs. Old

One of those lines is generational. The split is between the aging baby boomers and younger generations like gen-X or the millennials. On the one hand, we have articles that accuse old people of hoarding the wealth that they gained because they were born and grew up at a time when our expanding economy provided. We read that the fifties were a golden age in which a family could live well on one income, and we read that today’s young people face much higher barriers to the accumulation of wealth than the boomers did. On the other side of the divide, we see articles saying that old people should not have to pay property taxes on their homes because – it is said – the old people have already paid their dues. Both versions set up a conflict between the young and the old.

Men vs. Women

Then, there is the gender divide in which men are accused of oppressing women through the dominance of a patriarchy. Again, there is truth in this. Most positions of authority in the United States are held by men, but this argument obscures the fact that most men do not hold such positions. Most men are workers who are oppressed, but many of us do not see that. As a result, instead of rising together, men and women fight with each other.

White vs. Black

We also have a divide based on race. Again, it is real. People of color are and have been oppressed in our country since its founding. Policies like “red-lining” are or at least were real. Seniority policies promoted by unions have worked against people of color who became “the last hired and the first fired.” The difference in wealth between white people and people of color in our country is real, but who are the real oppressors? Remember that in the Civil War, poor white southerners died by the thousands to protect the plantation system that oppressed them.

Oligarchy

These political divisions come together in the phrase that says that political leaders in the United States are “pale, male and stale.” There is truth in this, too, but the phrase lacks an important adjective, and that adjective is “rich.” Our country is an oligarchy, and the oligarchs are rich people who use their money to control our electoral system and the representatives we elect. Some of the oligarchs are young, and some are old; some are men and a few are women; most are white, but a few are black. The oligarchy’s control is not perfect, but the oligarchs are working on that.

The oppression of young people, women or racial minorities is not the oligarchs' goal although, they can live with oppression. Their goal is to protect and increase their wealth. However, the oligarchs are happy to have the rest of us fighting among ourselves - men against women, black against white, young against old – because as long as we are doing that, the oligarchs can pick our pockets at their leisure, and they can run the country for their benefit. We need to wake up.

We Need to Wake Up

The oligarchs' current instrument for keeping us fighting among ourselves is the MAGA movement. The MAGA movement is in essence an immense diversionary tactic. It promotes the divisions that mask the oligarchy and blames women and minorities for the problems of working Americans. It also promotes a conflict between immigrants and native-born Americans.  MAGA focuses attention on cultural issues too. It works to make sure that voters focus on anything rather than the oligarchs.

The MAGA movement does these things while in the background, its leaders reduce income taxes and increase tariffs, which are consumption taxes, to shift the tax burden onto ordinary, working Americans. It eliminates environmental regulations that reduce the profits of corporations. MAGA's leaders hope that if they can keep the rest of us fighting among ourselves, they can continue to pick our pockets at leisure. We need to stop being suckered into fighting with each other and focus our attention on our real enemies. Wake up!

Hispanics as Americans

 Who Can Be an American?

This month we are celebrating Hispanic Heritage Month, and the celebration can teach us something about what it means to be American. Anyone can become an American because we Americans invented the idea of citizenship as a voluntary commitment.  We believe in the idea that anyone who accepts the responsibilities and duties of citizenship can be an American citizen, and we have no other definition of what it means to be American. Most other countries are different. If I moved to France, I could become a French citizen, but that would not make me a Frenchman; if I moved to Mexico, I might become a Mexican citizen, but that would not make me a Mexican; but the United States is different, a person who moves here can really become an American. American society is very open.

Our Openness Has Made Us Strong

Our openness to has made us strong. We have attracted people from all over the world, and they have built our society and our economy. The army that fought in World War II was made up in large part of children and grandchildren of immigrants. We had no shortage of people who could speak the languages of our enemies: German, Italian and Japanese.

Our definition of citizenship has made it possible for millions of people to become Americans without giving up elements of their ethnic heritages that they cherished. The Irish immigrants, who were scorned when they arrived, constructed an entire alternative school system to allow them to maintain their Catholic religious heritage in a largely Protestant country. It is not an accident that Notre Dame’s football team is known as the “fighting Irish.” The school system that the Irish created later helped millions of Italian and Polish immigrants to adjust to American life and to become Americans.

So, Let Us Celebrate Hispanic Heritage Month

So, it will be with the Hispanic heritage. Hispanic immigrants and their children will work to maintain parts of their heritage even as they integrate into American life. The children of Mexican immigrants will remember the Virgin of Guadalupe and their mothers' guisados even as they gradually lose the ability to speak Spanish, and their food will enrich our culture. Indeed, Mexican food has already become a part of American culture just as pizza and egg rolls did at an earlier time.

That is what we can learn from Hispanic Heritage Month. The maintenance of the Hispanic heritage does not make Hispanic immigrants less American in any way. The Hispanic immigrants are following the well-worn path that other immigrant groups followed before them, and the fact that they are able to do that will make us strong, and it will enrich our culture. So, let us join in the celebration of Hispanic Heritage secure in the knowledge that such celebrations are the secret of our success as a country.

Progressive Ideas Can Win With Crowley

 Crowley is Seen as a "Moderate"

David Crowley is the Democratic candidate for the position of governor of Wisconsin after beating Francesca Hong in the primary election.  Crowley is widely seen as a candidate from the “establishment” or “moderate” wing of the Democratic Party, while Hong is a Democratic Socialist who comes from the “liberal” wing of the party. It is worth taking a few minutes to explore the real nature of the difference between them because it is not nearly as great as it seems.

Crowley Comes From Milwaukee's Black Working-Class

In a way, Crowley ought to be the radical. He comes from a genuine, working-class family. His father was an electrician. His grandparents were part of the “Great Migration” that brought millions of black Americans fleeing from the violence and terrorism of Jim Crow to the cities of the North. Hong, on the other hand, comes from an upper middle class immigrant family. Her father is a social scientist at the University of Wisconsin in Madison. She grew up in an academic family, and she has owned a small business.

Crowley’s political base is in Milwaukee, where the city’s working class has been devasted by the loss of manufacturing jobs. In Milwaukee, workers have real grievances. Moreover, Crowley is a black man in a city with a history of difficult race relations. In contrast, Hong’s political base is in Madison, a center of intellectual liberalism. The people among whom Hong grew up have not been affected much by the loss of manufacturing jobs, and they have not suffered from housing segregation as Crowley’s people have. (There is housing segregation in Madison, but the academic community around the university has not been much affected by it.)

Crowley's Positions on Issues Are Not Very Different From Hong's

In spite of their different backgrounds, Crowley’s positions on “kitchen table” issues are not very different from Hong’s as you will see if you visit their campaign web sites. The details are different in some cases, but they both propose policies to increase economic justice and fairness in Wisconsin.  Crowley talks more about housing than Hong does, while she talks more about labor unions. She is more opposed to the building of data centers than he is, while he makes a point of making sure that they are built in a way that provides good jobs for workers. Both are in favor of investments in Green Energy. Yet Crowley is seen as the “establishment” candidate, while Hong ran as a Democratic Socialist and is seen as a “radical.” 

I suggest that the difference between these candidates is mainly a difference in vocabulary and identity. Hong identifies as a Democratic Socialist, and she uses the vocabulary of class conflict. She talks like a member of the intellectual, liberal community she grew up in. So, for example, she favors breaking up “big ag” and promoting agricultural cooperatives, while Crowley is silent on these topics. He talks like the big-city politician that he is. He stresses the need for cooperation and unity. However, for the most part, their positions on the “kitchen table” issues that affect working Americans directly are similar, but there are big stylistic differences between them.  Hong says that her positions are socialist positions, while Crowley does not. He joins James Talarico in promoting social justice without the language of revolution. Hong presents her positions as radical, while Crowley does not.

Progressive Ideas Can Win

In short, Hong is perceived as a radical because she says that she is radical and because the Republicans are happy to paint her as more radical than she really is. David Crowley is perceived as a “moderate” because he talks like one, but if you go to his campaign website, you will find that he supports policies that Republicans would like to paint as radical. In Wisconsin, at least, a Democratic Socialist was unable to win against a perceived moderate, but progressive ideas are another story. They can win. So, let's get busy and make sure that they win.

Save Democracy with a Wealth Tax

 Concentration of Wealth Endangers Our Democrcy

Last week’s post said that we needed to replace the property tax with a broad-based wealth tax because the property tax is outdated. It causes an unfairly large share of the cost of local government to fall on ordinary, working Americans while allowing most of the wealth of the rich of remain untaxed. That is true, but it is not the whole story.

There is another reason why we need a wealth tax: it offers a way to preserve our democracy by limiting the increasing concentration of wealth in the hands of the owners of capital. In his book, Capital in the Twenty-First Century, Thomas Picketty argues that in a capitalist economy, the share of national income going to capital will increase and the share going to labor will decrease as long as the rate of return on capital is greater than the growth rate of the economy. In addition, Picketty presents historical data showing that in fact the rate of return on capital has exceeded the growth rate of the economy in most periods with the major exception being the thirty years following the Second World War.

The "Glorious Thirty" Post-War Years

Many Americans remember the post-war period fondly as a period when a working family could afford to buy a house and a car and could live comfortably on one income. Fewer Americans remember that the period was exceptional in that respect. Most Americans were not so prosperous before the Second World War or before the Great Depression. The decline in the share of national income going to working Americans after 1975 was in fact a return to the normal situation that had existed throughout most of the history of modern capitalism.

A Way to Preserve Our Democracy

We should expect that the share of income going to capital will continue to increase and the share going to labor will continue to decrease in the future, and that presents a problem for our democracy. The American combination of market capitalism with democratic government depends on most people’s believing that the system is fair and not rigged against them.

They must feel that the system gives them a decent standard of living, which includes not only economic prosperity but also things like economic security, economic opportunity and personal dignity. Our system produces a high level of national prosperity, but it falls short on the other three elements of a decent standard of living for millions of our people because of the increasing concentration of wealth in a few very wealthy hands. Consequently, millions of people have lost faith in democracy and have become followers of authoritarian leaders who promise to Make America Great Again – that is to restore their security, opportunity and dignity.   

Our democracy has become unstable, and it will become still more unstable unless we can find a way to limit the ever-increasing concentration of wealth, which brings insecurity and lack of opportunity and dignity to millions of people. A wealth tax could give us a means of limiting the concentration of wealth, and the revenue it would provide would offer ways to provide more security, opportunity and dignity to millions of people.

The Property Tax – An Outdated Wealth Tax

 Resistance to the Property Tax

There is a lot of resistance to the property tax in our country today, but it is mostly misdirected. Some are saying that property taxes should not be levied on people’s homes if they are fully paid for. Others are saying that retired people should not have to pay property taxes or lose their homes if they are unable to pay the taxes.

In some ways the anti-property tax campaign is a fraud. The main beneficiaries of eliminating the property tax for retired people would be rich old people who own large properties. The specter of old folks struggling to stay in homes that they have paid for is mostly a front for wealthy folks trying to avoid paying their fair share of taxes.

High Property Values Have Led to High Property Taxes

However, there is also a real problem for some people. It has arisen because real estate values have risen enormously in recent years, and as a result, some people are faced with property taxes that are much higher than they can pay. This problem occurred in California in the nineteen seventies, and as a result, the voters there passed the famous Proposition 13 that limited what homeowners could be forced to pay. This created a problem for local governments, which depend heavily on the property tax for revenue.

A Little History

Why do local governments depend so heavily on the property tax? The use of the property tax to cover the cost of local governments began in the thirteen colonies in the seventeenth century. In order to fund important projects, local governments collected taxes, and inevitably, the taxes  had to be collected from people with sufficient wealth to pay them.

At that time, land was the principal form of wealth. Most private income was derived from land. Some people owned small farms, while others were major landholders. People who owned no land were mostly too poor to pay much in the way of taxes. Moreover, local projects like roads or harbors were often undertaken to promote trade in local products, which were often agricultural products. So, it seemed fair to pay for the projects by means of a tax on land, and local governments developed a tradition of using property taxes as a major source of revenue. People paid to support their local government in proportion to their shares of the community’s wealth. That continued to be true throughout most of our history, and today, local governments still depend on taxes on land for a large share of their revenue,

Today, Wealth Takes Many Forms

Today, however, a person's share of the land in an area no longer represents adequately his/her share of the wealth in that area, because today, land is no longer the principal form of wealth. People - especially wealthy people - own stocks, bonds, mutual funds, art collections. and other valuable investments. Today, land holdings account for only a small part of the wealth of wealthy people, who hold most of their wealth in other forms. In contrast, land holdings account for a very large share of the wealth or ordinary, working Americans, who often own little beyond the homes they live in.

Working Americans Pay an Unfair Share

As a result, ordinary working Americans pay tax on most of what they own, but wealthy Americans pay tax on only a small part of their wealth. That means that in America today, people are not taxed in proportion to their wealth as they were in the past. Today, our tax system reflects the structure of our economy as it was in the seventeenth and eighteenth centuries, not the structure of our economy as it is today.

In the face of this unfairness, we need to rethink the structure of our tax system. We need to figure out a way to tax all forms of wealth and not only real estate.

Taxes, Free Enterprise and World Domination

 A Warning

Recently, Jamie Dimon the CEO of JP Morgan Chase warned that the dollar is at risk of losing its status as the world’s reserve currency unless the United States maintains its economic and military power. He said, 

If America is in a weakened state… like if we’re not the strongest military in 25 years and the strongest economy, we won’t be the reserve currency either. … The world will be fragmented, and it’ll be very dangerous for us.

He is right, of course, but his warning is wasted because there is no way that we can maintain the economic and military dominance that we enjoyed for many years. We cannot do so in part because the world has changed, but our inability to maintain economic and military dominance is also due to contradictions within our own political culture. Our political beliefs will make it difficult if not impossible for us to maintain our economic and political dominance in the world.

Dominating the World is Expensive

One of the beliefs that will make it difficult for us to maintain our military dominance is our belief in low taxes. Maintaining military dominance is very expensive, and we have never been willing to pay enough in taxes to cover its full cost. We have maintained our dominance using borrowed money, and we could do that for many years because our government was able to borrow money at extremely low rates of interest. Our bonds were regarded as the world’s safest investments. Our own people and foreign governments were willing to buy American government bonds even though they paid very little interest.

That situation has changed. Our bond ratings have been downgraded, and interest rates have risen. Servicing our national debt is now the largest item in the federal budget except for Social Security. We now spend more on interest on the national debt than we do on national defense. We have to borrow money just to cover the interest payments on our debt. This situation is not sustainable in the long run. If we really wanted to maintain our military dominance, we would have to pay much higher taxes than we have ever been willing to pay.

Dominating the World Would Require Limiting Free Enterprise

Our belief in the value of free enterprise also interferes with our ability to maintain economic and military dominance because maintaining such dominance is not a goal of profit-making companies. Their goal is to maximize their profits, and to do that, they have moved their factories to countries where wages are low and environmental regulations are minimal. As a result, our industrial base has been hollowed out. 

Large companies have also organized their businesses in ways that minimize the taxes they must pay. They have located parts of their businesses in foreign countries in ways that allow them to book their profits outside of the United States and thereby to avoid paying taxes here. Doing that makes perfect sense from their point of view, but it reduces the revenue that would otherwise pay for us to maintain military dominance.

Companies are able to do these things because we lack the political will to prevent them from doing them. We believe in free enterprise. We believe that companies should be able to pursue profits unhindered as far as possible by government interference. We believe that if companies are allowed to pursue profits in this way, our economy will grow, and we will all benefit. 

One result of that belief in today’s world has been that companies have moved their operations to places outside of the United States. In some ways, that has been good for Americans, at least for those who have not lost their jobs. As consumers, Americans have gained by being able to buy goods that are cheaper than they would be if they were produced here. 

However, we have also lost the economic dominance that we once possessed, and we have lost the ability to produce many of the components of the weapons that are used by our military. We depend on foreign companies to equip our military, and that means that we depend on the rules-based world order that our current administration is tearing down. 

In theory, we could rebuild the manufacturing capacity to support our military without foreign trade, but that would take years at best. It would be impossible unless we became willing to restrain companies’ freedom of action much more than we have ever been willing to restrain it in the past. 

We Must Get Used to Living in a World That We Do Not Dominate

Thus, our commitment to low taxes and our commitment to free enterprise make it difficult and perhaps impossible for us to continue to dominate the world economically or militarily. To maintain that domination, we would have to pay much higher taxes than we have ever been willing to pay, and we would have to limit the ability of companies to pursue profit by moving outside of the United States. We are unlikely to do either of those things, and so, we are going to have to learn to live in a world that we do not dominate.

Keep Our Eyes on the Prize

 We May Just Blow It

Progressives in the United States are in danger of throwing away a real chance at victory in this fall's elections. The split in the progressive movement over support for Israel could destroy the opportunity for progressive change that Pres. Trump’s corruption, incompetence and racism have given us.

Trump was a elected on promises to bring manufacturing jobs back to the United States and to keep us out of pointless wars. He has done neither. In addition, his tariffs have inflicted major pain on rural voters who voted for him in large numbers, and his campaign to deport undocumented immigrants has led to shooting ordinary, white Americans dead in the streets. Finally, his pointless war with Iran, and his support for Israel’s indefensible actions in Gaza have alienated millions of Americans. These things should make taking control of Congress in 2026 a slam-dunk for Democrats.

Within the Democratic Party, the progressive wing is growing in power because its members are the only Democratic leaders with ideas about how to make our country more just and equitable. The senior leaders of the party offer only that they are not Trump, but that is not enough. So, we see progressive candidates winning primaries all over the country. Many Americans are hungry for progressive change, and that offers an opportunity to Democrats in November.

An Opportunity is Not a Victory

We can easily blow our opportunity. To turn it into a reality, Democrats must stick together, but the party is in danger of unraveling because of differences over Israel. On the one hand, we have many people supporting the Palestinian cause to the point of saying that the State of Israel is a colonialist entity that ought not to exist. That position borders on overt antisemitism.

On the other hand, we have people who believe that support for Israel must include support for its current government even when its policies are turning the State of Israel into an apartheid state. Those who hold this view are investing millions through AIPAC into electing candidates who support American military aid to Israel.

Those on one side of this argument seem to say that any violence committed against Israel is justified, and those on the other side seem to say just as strongly that any violence committed against Palestinians is justified. Neither of these positions makes sense, and neither should be allowed to dominate the Democratic Party. Either position will drive millions of progressive Americans out of the Democratic Party and doom the party’s chances of taking control of Congress this fall.

Eyes on the Prize

Progressives should remember that this election has two purposes. The first is to preserve American democracy from Trump’s attempt to destroy it. We cannot allow him to continue his march toward fascism. The second purpose is to elect legislators who will support real, practical, progressive solutions to our country’s many problems. We want legislators who will put Social Security on a secure financial footing without cutting benefits; we want legislators who will take climate change seriously enough to promote actions to mitigate its worst effects; we want legislators who will support an equitable national healthcare system; and we want legislators who will take a realistic view of our other national problems.

We will get these things only if we maintain a clear focus on the goals of this election. If we allow our attention to be diverted, we will very likely lose this year’s election. We must not allow our differences over Israel and the war in Gaza to split our party. Those who support the Palestinian cause must avoid claiming that Israel should not exist, and those who support Israel must accept that opposition to Israel’s policies or to American military aid to the Israel is not antisemitic.

Let’s keep our eyes on the prize and win this fall’s election!