Indecision 2012

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Marx-Trek's picture
Marx-Trek
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Sep 18 2012 04:22
Indecision 2012

So after watching the recently leaked video of Mitt Romney speaking to a group of donors where Romney goes on claiming that half of the US population does not pay taxes, is unemployed, and is basically freeloading off of the government, I couldn't stop thinking about how the issue of taxes has become such a central American political issue and how the reactionary right uses the tax discussion to attack the decaying welfare state and state funded programs paid for by workers income taxes.

Romney was videotaped saying,

"There are 47 percent of the people who will vote for the president no matter what. All right, there are 47 percent who are with him, who are dependent upon government, who believe that they are victims, who believe the government has a responsibility to care for them, who believe that they are entitled to health care, to food, to housing, to you-name-it. That that's an entitlement. And the government should give it to them. And they will vote for this president no matter what. ... These are people who pay no income tax. My job is is not to worry about those people. I'll never convince them they should take personal responsibility and care for their lives."

and yahoo news responded with,

Romney seems to be referring to the estimated 47 percent of Americans who did not owe federal income taxes in 2011 because their incomes were so low that they qualified for a tax credit, or because they didn't work at all. Last year, 22 percent of people who didn't owe income taxes were elderly people on Social Security, and an additional 17 percent were students, disabled people or the unemployed. More than 60 percent of the group were low-income workers, many of whom qualified for the child tax credit or the earned income tax credit. (These workers did pay payroll taxes for Social Security and other programs.)

The Romney spokeswoman, Gail Gitcho released a statement,

"Mitt Romney wants to help all Americans struggling in the Obama economy," she said. "As the governor has made clear all year, he is concerned about the growing number of people who are dependent on the federal government, including the record number of people who are on food stamps, nearly one in six Americans in poverty, and the 23 million Americans who are struggling to find work. Mitt Romney's plan creates 12 million new jobs in four years, grows the economy and moves Americans off of government dependency and into jobs."

And finally Obama campaign manager Jim Messina responded with,

"It's hard to serve as president for all Americans when you've disdainfully written off half the nation."

My thoughts on the matter is not whether Obama or Romney are different or if one is better than the other. Rather, I am interested in how the class that represents capital views the American worker. The bourgeoisie seems to view the American worker as an unemployed freeloader that doesn't pay taxes when in reality the American worker is so poorly paid that they do not make enough money to even pay the taxes the owning class wishes us to pay, even if it is according to their own tax codes and tax policies. Its ironic that a man can complain about people getting away with not paying enough taxes, according to Romney calculations, when he himself has made a living off of not paying his own taxes through loopholes and tax advantages.

Anyway, I just wanted to see if anyone is interested in discussing the American tax system and wrongly depicted view of workers who are paid to poorly to pay the amount of taxes Romney thinks we should pay and how this plays out in American politics, etc... Any takers?

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Schwarz
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Sep 18 2012 19:46

The question of taxes in U.S. politics is a complex one, but I'll bite!

I'm not sure it makes sense to attribute particular political views to 'the bourgeoisie', because while this class does hold some overarching agreement on the fundamentals (perpetuation of the profit system, nationalism, denial of the class struggle, etc.), there still remains a degree of dissent among them regarding ideology and particular policies. These often break down by sectoral and regional interests, but also reflect cultural, ethnic and other divisions.

The vulgar pwog expression of this 'corruption' or 'injustice' is a lamenting of money in politics (see the paroxysms re: Citizens United) as though politicians are merely bought off by lobbyists and contributers. They look to the heroic days of FDR for a time when 'workers had a say.' In reality, U.S. political theater is already-always a reflection of ruling class ideas distilled into populist-sounding rhetoric with a heaping dose of obfuscation, partisanship, appeals to patriotism/community, and fear-mongering.

That said, we should ask ourselves why Romney's '47%' idea may have resonance for its audience and who that audience might be.

Each political party in the U.S. is a cross-class coalition of various 'interest groups' bound by a loose and shifting ideological core.

For the modern Democrats this can be seen, with some exceptions, as a coalition of civil rights groups, unionists/union bureaucrats, government workers, sections of the coastal managerial stratum, semi-skilled and skilled creative workers and high-tech, finance, the culture industry and some industrial capital.

For Republicans this coalition consists of evangelical christian groups, non-union blue-collar workers, sections of the coastal and much of the mid-western/southern/western managerial stratum, semi-skilled blue collar and skilled white collar professionals, small business owners and multinational capital.

Again, this is a very rough sketch, but I think it is important to delineate the interests at play when we address tax policy in particular and U.S. politics in general.

The roots of the right wing attack on entitlements and big government we see today come out of the tax revolts of the 1960s and 1970s. These, in turn, were a development that arose from both a long tradition in U.S. history and also the political and economic conjunction of that time. This will be a very schematic presentation, but I think we can see the roots of the anti-tax ideology in the following:

Anti-Federalism:

Since the founding of the U.S. there has been a strong states rights tradition. This cannot just be dismissed (as many on the center-left and left try) as mere provincialism and/or implicit racism. The fear of a strong central government was enshrined in the Jeffersonian ideal of the small, independent, self-governing producer. Of course, against this was posited the overarching power of a distant federal government and, what was seen as its corollary, money power in the form of a central bank and high finance. Which leads to...

Producerism

The Jeffersonian ideal arose out of situation where the majority of Americans were artisans and yoeman farmers. As this class situation quickly eroded with the 'market revolution' of the 1830s and the 'second industrial revolution' of the 1860s, this notion of 'producerism', the veneration and defense of those who produce directly versus those who live off of their surplus, split into left and right variants of populism.

For a left version of producerist populism, see the aptly-named Populist movement that arose at the end of the 19th century. This was a popular upsurge in the plains states against the railroads, Wall Street and corruption that nearly succeeded in uniting with the early socialist movement in the cities to form a 'popular front' against eastern capital.

For a right-wing version, look no further than the Goldwater/Reagan/Friedman wing of the Republican party which arose in the 1950s-1970s. I'll address this below, but we are being dishonest with ourselves if we see the rise of this ideology as a mere trick played on the working class in the U.S., a la Thomas Frank.

Race-Baiting

These attacks on the (relatively meager) U.S. welfare state cannot be extricated from the urban crisis of the post-war period. Of course, the ruling class has always used racial and ethnic differences to dissolve working class unity (see Jim Crow, the use of minorities and women as scabs, etc.). As primary production of cotton and tobacco was automated in the 1940s and 1950s, the political economy of the south was upended and former sharecroppers had little choice but to flee to the cities where industrial and service jobs were available.

With the Civil Rights movement and the black/latino upsurge in the cities, the Democrats were compelled to expand the federal government with the Great Society program. While this expansion of entitlements (much like the New Deal before it) was ultimately to the benefit of capital and meager working class gains were shared across the color line, the right-wing found in these programs a successful cudgel to break apart FDR's quasi-social democratic coalition. Many white workers and professionals were open to attacks on urban populations since they were in the process of fleeing those very same areas - with the help of federal subsidies, of course. So in the 1960s the tax question, as we know, became entwined with the extremely poisonous and divisive 'race question'.

Thus in 1960s California one begins to see the first 'tax revolts' against state and federal spending. But this is not the whole of the story.

The crisis of the late 1960s and 1970s

As the rate of profit began to fall around 1968, not only did the basis for post-war growth erode, but so did the New Deal coalition and its corollary: business unionism. For this history, I would highly recommend reading An Injury to All, by Kim Moody, Stayin' Alive, by Jefferson Cowie, or the collection Rebel Rank and File, by Brenner, et al. At the same time that the ruling class was flailing around to find a 'solution' to the ensuing stagflation, the working class was everyday attacking the tenets of authoritarian business unionism and capital in rank-and-file revolts across the country.

Suffice it to say, despite some heroic struggles, the American working class was unable to turn their attack on their union structures into a concerted attack on capital or a break from electoralism. So by the late-1970s, many of the gains in wages, benefits and union made over the previous 40 years were being eroded. By 1981, with Reagan's defeat over the PATTCO strike, it was open season on the working class. This reality on the ground was compounded by a series of policies called neoliberalism.

So how does this relate to tax policy? With a decline in the rate of profit on capital and a decline in the wage bill for workers, there are a variety of ways in which people can fight to maintain their dignity and standard of living. The rank-and-file revolts of the 1970s were a reaction based on solidarity, struggle as a class, a rejection of representation, etc. There were also left populist revolts against corruption, the concentration of agricultural capital, environmental degradation, consumer rights, etc. But if all that has failed (and it had failed by 1980) how does one keep up in a miserable situation?

This is the key, in my mind, for understanding the turn towards right populism among small business owners, proletarianized small farmers and skilled/semi-skilled workers in the U.S.

If material gains cannot be made through other means (unionization, an increase in the social wage, rent controls, public housing, etc.) then lowering individual taxes becomes an attractive way to keep up, especially in a era of high inflation. If small businesses owners are suffering from bankruptcies and competition from concentrated capital, lowering business taxes can keep an enterprise afloat. If capital-intensive agriculture has marginalized the small farmer, then attacks on entitlements for urban workers become attractive. If big industry faces falling profit rates, then a decrease in corporate taxes helps to mitigate the losses and prevent a 'shake-out' of devalued capital. For sections of capital that do an increasing amount of business overseas, the decrease in domestic spending that accrues from tax increases and entitlement cuts on workers have a negligible effect.

So, Romney's comments on entitlements and taxes are part of a longer right-wing populist narrative that remains powerful in a time of crisis. Just free business of taxes and regulation and the economy will prosper! Just get more American workers to contribute to income taxes and we will have a fairer system and more responsible populace! As we know, austerity programs of this type are a thinly-veiled attack on the working class with the purpose of increasing profits. But if it can be spun the right way, these assaults can resonate among some of the slight majority of eligible Americans who actually bother to enter the voting booth.

Whereas left populism, for all its warts, attacked money power, bankers, big capital, etc., right populism is an inverted form of producerism... wherein the rich are rich because they 'produce the most value' and the common worker is exploited by the elite: in this case, big government bureaucrats stealing tax dollars to give to the work-shy, hollywood liberals subverting american values, teachers and professors preaching secularism and leftism, union thugs holding back the potential of capital and labor to succeed together, etc. Throw in the old American tradition of race-baiting to divide the working class and stoke resentment and you have the lynchpins of class rule in the United States.

Of course, the Democrats also represent the interests of capital, but in different ways. But, then I've already written an opus here! Like I said, this is a very complex history. I'm sorry to ramble on for so long, but I think this is an important question that should be addressed. It really gets at one of the ways in which the ruling class rules in the U.S.

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Sep 19 2012 17:24

That was fucking impressive, man,

I actually think that's worth writing up and sticking in the libcom library.

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Melancholy of R...
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Sep 19 2012 20:30

BRAVO!

redsdisease
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Sep 20 2012 00:51
Chilli Sauce wrote:
I actually think that's worth writing up and sticking in the libcom library.

Agreed!

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Sep 20 2012 12:40

Very nice indeed!

Schwarz's picture
Schwarz
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Sep 20 2012 20:10

Cheers, all! The admins approved my request for a blog, so I'll expand the comment and post it up after work.

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Chilli Sauce
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Sep 21 2012 04:24

That's awesome! If that's your standard of writing, I am thoroughly looking forward to reading that blog.

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Sep 21 2012 14:00
Marx-Trek wrote:
Anyway, I just wanted to see if anyone is interested in discussing the American tax system and wrongly depicted view of workers who are paid to poorly to pay the amount of taxes Romney thinks we should pay and how this plays out in American politics, etc... Any takers?

My 2 cents on it is this.

Tax as such is a fetishistic category. It conceals the social relations hidden underneath the Trinity Formula1 which makes it appear as if the share of wealth apportioned to each individual is to be found in his source of revenue, which makes surplus value extraction appear as its opposite: that one only gets what one contributes.

The problem with tax is now that the abstraction of a tax payer is taken at face value as the reversal of the exploitative relations in production - those that pay the most tax (usually corporations) are seen as the exploited (or at least, as the great monetary benefactors of society) and those that do not (the unemployed for example) are seen as parasites.

To uncover the secret of taxes, we have to return to the production process. Long story short (since I assume you know your Marx), wage workers receive their wages (the 'value of labor power') and the capitalists extract surplus value, which is then split into (industrial) profit, interest, rent, and, here's the kicker, taxes. This has two implications. First, the taxes a wage worker pays are not part of the value of labor power - they're a deduction from the surplus value appropriated by the capitalists2. Secondly, and more importantly, it is the working class that 'finances' the state machine through the creation of surplus value, not the exploiters. They see taxes as a deduction from their profits, but since these come from the exploitation of workers, it is not the contribution to society by the capitalist through an act of virtue.

Therefore, if you see someone defend tax payers, look closer.

  • 1. Old Karl sez:

    In the formula: capital — interest, land — ground-rent, labour — wages, capital, land and labour appear respectively as sources of interest (instead of profit), ground-rent and wages, as their products, or fruits; the former are the basis, the latter the consequence, the former are the cause, the latter the effect; and indeed, in such a manner that each individual source is related to its product as to that which is ejected and produced by it.
    - Capital Vol III Ch 48

  • 2. That taxes could lower the value of labor power is of course open to debate but I consider this correct
petey
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Sep 21 2012 15:30

on a more superficial level, here are some fucking idiots:
http://the53.tumblr.com/

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Sep 21 2012 15:49
petey wrote:
on a more superficial level, here are some fucking idiots:
http://the53.tumblr.com/

That right there is fetishism in practice.

Undoubtedly the stupidest thing I've seen all day.

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Sep 21 2012 20:46

Parade of horrors (14 hours a day, 7 days a week?!?!?) and suckers.

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Sep 25 2012 01:20

Sorry for the delay in the blog post, work has been kicking my ass. I am working on it now and it'll be up soon.