Economic Reality Check

     The rich are getting richer while the rest of us are working harder for less. The majority of Americans are less secure and less hopeful about their future. Good paying jobs are disappearing. Real wages and family incomes are falling. Retirement security is fading. Healthcare costs are out of control. 401K’s are taking a dive. Millions of people are losing their homes, and we’re looking at over $1 trillion of taxpayer money to bail out Wall-Street financial firms. Conservatives preach that liberals, who believe in shared prosperity, want to redistribute our national wealth, but the facts show that conservatives continue to push policies that have redistributed a larger proportion of our national wealth to the top 10% of the riches Americans. Let’s look at the facts:

    90% of our nation’s income gains since 1989 went to the highest-earning 10% of U.S. households. Over 90% of the value of shareholders’ equity in America is owned by the riches 10% of households. 47% is owned by the top 1% of households who also control 38% of the wealth but pay 24.8% of federal taxes. The bottom 80% of households own just 2% of corporate stocks. The top 1% of American families took 23% of all personal income up from 10% in 1979. The wealthiest 5% have over 60% of the wealth, but pay 38.4% of federal taxes. These households have an average wealth of $10.2 million, but pay only 3.5% of their wealth in taxes. The bottom 40% of taxpayers has an average net wealth of $1,100 and pay 163% of their net wealth in taxes. The least wealthy 60% of Americans have less than 5% of our national wealth, but pay more than 14% of federal taxes. Between 2001 and 2007, over 4 million more Americans have joined the ranks of the poor. The median household income has fallen $2,000 since 2000.

     Corporate executives get paid 275 times more than the average worker compared to 27 times in 1973. Productivity has jumped over 20% since 2000, yet most of that economic gain went to the very rich while typical workers’ wages have stagnated or declined. Corporations continue to rake in over $150 billion a year in taxpayer subsidies, tax breaks and grants while using much of the money to move jobs out of the U.S.  In the years 1998 through 2005, 2/3 of U.S. corporations paid no taxes. Corporate profits now make up their largest share of the economy since the 1960s while wages and salaries make up their lowest share of the economy in nearly six decades.

      The United States has lost 7 million good paying jobs tied to unfair trade since the late 1970s.  50% of all manufacturing production of U.S.-based companies is located in foreign countries. We have traded $15 to $20 an hour jobs for $7 to $10 an hour jobs.  Medical bills now account for half of all bankruptcies. ¾ of these bankruptcies were from Americans who had medical insurance. There are now 45.7 million Americans without medical insurance up over 9 million from 10 years ago. Over 30 million Americans are underinsured. Medical care costs and premiums have increased by more than double the rate of inflation.

     Over the last 8 years, our nation has been living on borrowed foreign money ($365 billion from China alone) to support our over $400 billion annual deficit. Without adding the recent and proposed bailouts of over $1 trillion, our nation is over $9.5 trillion in debt. We have a $13 trillion economy while one out of five children lives in poverty.  37 million Americans live in poverty up 4 million since 2001. This is the results of “Supply-Side” Bush-McCain economics.

Sources:  Census data, Kaiser Family Foundation, Institute for Policy Studies, Public Citizen Trade Watch, USW-Hart Research, Financial News- Yahoo, Economic Policy Institute, Office for Social Justice (www.osjspm.org/101_taxes.htm)

                                                                                                        Issued by: Local 808 C.O.P.E. October 8, 2008

The Economy, Taxes and Jobs

Obama & McCain

    John McCain says he will not raise taxes and continues to say that Barack Obama will raise everyone’s taxes. The truth is that McCain would cut taxes mainly for those making $2.8 million or more a year while creating a new income tax on working Americans by taxing healthcare benefits. He would increase the dependent tax credit from $3,500 to $7,000 and cut corporate tax rate from 35% to 25%.  A tax policy center analysis said McCain’s proposals, excluding those addressing healthcare, would reduce tax revenues by $4.1 trillion over the next 10 years. McCain insists that this lost tax revenue would be offset by a growing economy and reductions in spending for entitlement programs like Medicare and Medicaid.  John McCain is also one of the strongest anti-union Senators in Congress which has had a major declining affect on wages and benefits.

   McCain now supports Bush’s economic and tax policies after voting against the tax cuts saying it would be mainly for the rich and add to the deficit.  His plan to improve the economy also includes development of alternative energy resources, but he has not committed to how much he would invest in this program.  He would balance the budget by dramatically cutting federal spending including Social Security and Medicare benefits and social programs for the poor. He voted yes to $40 billion in reduced federal spending for social programs for the poor. (Dec. 2005) and voted no on prioritizing national debt reduction before tax cuts. (Apr. 2000)  He said he is for spending caps and a balanced budget and is strongly against “pork” spending and earmarks. McCain missed the vote on the stimulus package even though he was in Washington DC at the time.  He voted no on restricting employer interference in union organizing. (Jun. 2007)  John McCain has a strong anti-union voting record. He voted against protecting our overtime rights and repealing the striker replacement rules. He also voted against the “Employee Free Choice Act”.  He talked against tax subsidies for corporations, but then he voted against repealing tax subsidies for companies who use the money to move U.S. jobs offshore. (Mar. 2005) He would not vote to raise the minimum wage without tax-payer subsidies for business.  McCain also voted against a budget increase for SCHIP to cover more children with healthcare. He opposes any form of Universal Healthcare and he voted against retaliation measures to protect us from illegal trade practices and human rights violations. He also voted against an amendment to prohibit Mexican truckers from operating beyond a limited border zone because they are not held to the same safety standard as U.S. trucks (H.R. 2299 vote #252 7/26/01)

     Barack Obama’s economic plan would let tax cuts expire under current law for those making $250,000.00 or more a year and would raise taxes on capital gains and dividends above the current 15%.  Obama would also cut taxes for those making $150,000 or less a year and would eliminate federal income taxes for retirees making $50,000.00 or less a year. He would also give working Americans earning under $75,000.00 a $1,000.00 per year tax cut to help offset payroll taxes on Social Security and Medicare that most rich Americans don’t have to pay. McCain has publicly stated that increasing payroll taxes on Social Security is “not off the table”.  However, our research shows that he would primarily focus on cutting Social Security benefits. Obama would focus on maintaining Social Security benefits and raising the income cap, now $102,000 a year, for paying Social Security taxes. Obama would cut corporate taxes, but he would also stop tax subsidies to companies that use the money to export our jobs.                                                                                               

      Obama would increase the minimum wages to $9.50 an hour and index it to inflation. He wants another stimulus package this year and proposes to give every tax payer $500.00 ($1,000.00 per couple) to help pay for the high cost of energy. He would use $150 billion in stimulus money for developing clean and renewable energy. He would also put $10 billion into state and local infrastructure improvements. John McCain opposes this idea instead wants to suspend the federal gas tax (18.4 cents/gallon) for the rest of the year costing $10 billion in tax revenue needed to pay for highway construction jobs. Obama says he would expand the economy and jobs through increased spending on domestic programs, infrastructure projects and alternative renewable energy.  Many experts say this will drive down oil prices and create million of jobs. He said we could generate more than $150 billion a year in added revenue just by letting the tax cuts for the rich expire. He would also create a “wind-fall” tax on rich oil companies to help pay for alternative energy development which will help drive down oil prices. Exxon Mobile Oil Company received $17 billion last year in tax subsidies. Obama would stop these subsidies. Obama says that these increased tax revenues and taxes generated from a growing economy will help pay for his proposed investments in our economy, national healthcare, the War on terrorism and to balance our nation’s over $400 billion budget deficit. Obama wants the rich to pay more to support the War and to pay down our $9.5 trillion national debt.

    Obama says he believes in being responsible and accountable to tax payers’ and would maintain “Pay-Go” that requires no deficit spending. He supported the program that will provide government guaranteed loans to homeowners to refinance sub-prime mortgages in default. He also says he would “responsibly” draw down our troops from the Iraq war that has been a major ($10 to $12 billion per month) drain on our economy.             

    Obama voted against $40 billion in reduced federal spending that McCain supported that would have cut funds for social programs like Medicaid and Medicare. (Dec. 2005)  He voted to repeal tax breaks for companies that use the money to move U.S. jobs offshore (Mar. 2005).  However, he would also cut corporate income taxes for companies that do not export our jobs, but instead invest and create new jobs in America. Obama has a strong voting record on raising the minimum wage.  He said we should protect consumers by creating a credit card Bill of Rights. (Feb. 2008) and by regulating financial instruments to protect home mortgages. (Aug. 2007)   He stated he would fight the attacks on workers’ rights to organize and strike, (Feb. 2008) and will strengthen unions and workers’ rights. (May 2004) He supports the passing of the “Employee Free Choice Act”.  He was not in the Senate when NAFTA was passed, but he has said he would strictly enforce trade laws and renegotiate NAFTA to improve labor and environmental protections.  Obama voted against McCain’s efforts to eliminate our unemployment Insurance program.

 Sources:  New York Times, Nonpartisan Tax Policy Center, Candidates’ Web Sites,

www.ontheissues,org. www.2decide.com), Candidates’ Web Sites, www. 2decide.com

Issued by: Local 808 COPE               October 8, 2008