- Written by Ken Alpern
17 Feb 2012
HERE’S THE FISCAL FIX - It’s human nature to blame someone else for our own shortcomings, and it’s human nature to demand someone else give up something while ignoring the shortcomings of that person you see in the mirror every day, but our modern American society is led by those particularly prone to detracting from the truth when it makes so much political sense to do otherwise.
Fanned by political flames and special interest funds, the blue/red political divide detracts from the truth…despite an eye-opening Internet and an American history of doing the right/moral thing for the greater good. The problems are maddening because of the incessant and repetitive group-speak, canards, conflation, and straw-men—but big money can’t stop The Truth.
Ask Mitt Romney whether his money is getting the job done in getting past Rick Santorum in the polls. Ask Meg Whitman whether or not her money got the job done in the last gubernatorial election against Jerry Brown. Ask the Democratic leadership whether or not their money and funds from public sector unions got the job done in raising taxes past a Republican minority who crossed their arms last year and said “no” to new taxes.
So file this under “Duh”, or “the Arab Spring”, or the “Internet”, or perhaps file this under “you can’t fool all the people all the time”, but our hard economic times and our disdain for Big Money/Big Bullies thwarts the old-fashioned power grabs.
For example, some Coliseum top execs receive huge lump-sums for sick pay (link) at public expense in an era when sick/vacation pay is being lumped for private sector employees with a PTO (personal time off) account that reduces both absenteeism and cost to businesses both large and small.
The answer? Greater acknowledgment that public sector compensation needs lots more fixing that will last well beyond this next election cycle. And don’t worry about the economy bouncing back and papering this problem over again. That won’t happen in this city, county, state or nation for a few years.
Governor Brown has, to his credit, stared public sector unions in the eye and let them know that either the budget won’t add up or the people won’t tolerate more tax hikes without public sector reform. Unfortunately even our governor and his team have some serious self-introspection and personal cleanup to do, as evidenced by his Fair Political Practices Commission’s scaling back on openness. (Link)
The answer? More articles, talk radio, and books from both left and right to shine the light on inappropriate and unsustainable fiscal and political practices everywhere. Not to worry—these hard economic times and a lack of enthusiasm about both political parties fans the fire against both Republican and Democratic hypocrisy and greed.
Even at the national level, President Obama is focusing on replacing the Alternative Minimum Tax with a Buffett rule, (link) which means that (perhaps a few doggone years too late!) he and other Democratic leaders have figured out that “the evil rich” don’t exist at earnings levels that begin at $250,000 but at $1,000,000.
The answer? An overdue and honest discussion as to who is “evil” and who is “rich.” The GOP can always talk about how bad it is to tax millionaires more (especially when millionaires are as self-made as those making $250,000 annually, and who do so much of our nation’s hiring), but there are no shortage of Republicans who have some sentiment towards the Buffett rule while there are no shortage of Democrats who are focusing on how to pay down our debt.
So along comes President Obama’s budget that increases transportation funding, includes a payroll tax cut, and increases taxes on the wealthy (whatever “wealthy” is defined as), and of course there’s Republican opposition (some legitimate, some based on political hypocrisy) to counter that. But even the Times editorial staff, who are hardly fair and balanced with their Democratic partisanship, is pointing out that we’re ignoring our increasing national debt (link) and postponing the tough budgetary choices.
The answer? Use the talking point of “our children are NOT going to pay down OUR debt!” to be used by both parties. That may never happen, but it IS the answer. By having Democratic leaders make it clear that having the rich pay too much of the tax burden, we’re making the rich the “goose that lays the golden eggs” and giving them too much political power that will have to be pandered to (which Democrats right up to the President have done).
Similarly, by having Republican leaders make it clear that we must pay down our debt, and that while everyone must do their share, the rich are currently in a better place to pay down the debt right now…and higher-income Americans have the financial savvy to know that national debt reduction will stimulate our economy, the dollar and increase hiring.
Another answer? In addition to pension reform, a federal, state, and local public sector hiring freeze to reduce the public sector burden on a private-sector tax base that just can’t shoulder an unsustainable public sector burden. That is what President Clinton did to help reduce the deficit in the 1990’s, but that is what our current President did NOT do, and still hasn’t done. Ditto with Sacramento, both under Republican and Democratic governors Schwarzenegger and Brown.
Hiring more public sector employees may help in an election, but it doesn’t add up for the Democrats. Complaining about the debt without paying it down doesn’t add up for the Republicans.
And if we freeze (and I mean FREEZE, preferably CUT across the board) our federal budget, we can start by a one-time income/sales tax to pay off our $1 trillion price tag of the Afghanistan and Iraq conflicts to date in a year. It should immediately expire when that $1 trillion is paid off—period, no if’s, and’s or but’s.
Not a cure-all, but a sea change in thinking and operations in a country that talks, but doesn’t do anything, to put its financial house in order. Just a start. An obvious start.
Or is it so obvious to the ruthless and diehard partisans among us?
Tags: Ken Alpern, economy, Governor Brown, President Obama
Vol 10 Issue 14
Pub: Feb 17, 2012