EMAIL PAGE FIVE
COLUMN EIGHTY-SIX, MARCH 1, 2003
(Copyright © 2003 The Blacklisted Journalist)
BY PAUL KRUGMAN
Subject: NYTimes.com Article: A Touch of Class
Date: Tuei, 21 Jan 2002 23:19:47 -0500 (EST)
January 21, 2003
A Touch of Class
By PAUL KRUGMAN
A liberal and
a conservative were sitting in a bar. Then Bill Gates walked in. "Hey,
we're rich!" shouted the conservative.
"The average person in this bar is now worth more than
a billion!" "That's silly," replied the liberal. "Bill Gates
raises the average, but that doesn't make you or me any richer."
"Hah!" said the conservative, "I see you're
still practicing the discredited politics of class warfare."
Am I caricaturing the debate? Alas, not at all. Whenever
anyone points out the systematic tilt of the Bush administration toward the
rich, the administration and its defenders immediately raise the cry of
"class warfare." Yet when you look at the arguments the administration
actually makes on behalf of its policy, they are as silly as that of the
conservative in the bar. The difference is that the administration knows exactly
what it's doing.
For example: On Saturday, in his weekly radio address,
George W. Bush declared that "the tax relief I propose will give 23 million
small-business owners an average tax cut of $2,042 this year." That remark
is intended to give the impression that the typical small-business owner will
get $2,000. But as the Center on Budget and Policy Priorities points out, most
small businesses will get a tax break of less than $500; about 5 million of
those 23 million small businesses will get no break at all. The average is more
than $2,000 only because a small number of very wealthy businessmen will get
huge tax cuts.
So the latest round of Bush tax cuts, like the previous
round, mainly provides benefits to the very, very well off---and once again the
administration is shamelessly misrepresenting the content of its own policies.
But aside from the honor and integrity thing, should we care?
There's been a concerted effort to convince us that we
shouldn't---that anyone who even pays attention to who gets what must be
motivated by envy. Consider a recent cover of Business Week. Under the headline
"Class Warfare," it asked: "Suppose Bush's tax plan works: It
raises long-term growth, reduces unemployment, boosts workers' wages, and
eventually cuts a rising deficit. ... Now suppose the rich get richer, and
income inequality gets worse. Time to vote."
As Superman used to say, "What th'?" Does
Business Week really think that's the argument---that opponents of the Bush plan
agree that it will do great things for the economy, that the increase in
inequality it will cause is their only objection? In fact, those who oppose the
Bush plan think it will work no better than the 2001 tax cut: that it will do
little for growth or employment, and will sharply raise the deficit. (These guys
now have a track record, and it's not encouraging. In the year and a half since
that tax cut, which was sold as the perfect economic stimulus, the economy has
lost 1.4 million jobs.)
Meanwhile, let's look at what the administration isn't
doing. It's not allocating enough money to meet its own goals for homeland
security, or to provide adequate funding for Medicare. It has scaled back
promised pay increases for the military. It's not providing a penny in aid to
desperate state governments---it isn't even helping them meet the new burden of
homeland security spending mandated from Washington. (Remember those promises,
after Sept. 11, of aid to fire departments and police? That was then.)
And bear in mind that the budget deficits of state and
local governments are forcing cuts in medical care for the poor and public
services for everyone. Many states, even those with Republican governors, will
be forced to raise taxes too---but the burden of those increases will fall on
the middle class, not the rich.
The only beneficiaries of the latest Bush plan will be
those who receive tax cuts big enough to offset all these negatives. Those
beneficiaries are the usual suspects---the same small, wealthy minority that got
the big benefits from the last tax cut. Does pointing this out constitute class
The administration and its defenders will, of course,
insist that it does---because that charge helps confuse the public about what's
really going on. But for the record: When people like me stress how few
Americans will gain from the Bush plan, we're not talking about envy; we're
talking about priorities.
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