Bailout Taxes

By David Swanson

I've just interviewed Les Leopold, who blames the recent financial disasters on trends that began over 30 years ago, explains how a great deal of Wall Street's "investing" has had as much connection to the real economy as fantasy baseball has to baseball, diagnoses the failures of labor and the left to resist the financialization of the economy, views the current situation with genuine optimism as a rare moment in which we might be able to make necessary changes to regulate finance and to shift money from a tiny group of billionaires to the rest of society, and explains why that latter step is needed to stabilize any economy.

With teach-ins planned everywhere on June 10th and people trying to educate each other on exactly what just happened to trillions of our children's dollars, you could do a lot worse than to gather some friends together, read or listen to, and discuss, this interview, and then take appropriate actions.

Here's the audio in an mp3. It's a little under an hour.

David Swanson interviewing Les Leopold:

By David Swanson

If you're like me you find it at least a bit disturbing that we're giving trillions of dollars to save the economy to the very people who wrecked it, and more disturbing that we're doing so without any solid basis for expecting to get much of it back and without making fundamental changes to prevent a repetition. But if you're like me, you also aren't 100 percent certain how a credit default swap works with a cubed collateralized debt obligation, much less whether such a monstrosity needs to be eliminated or reformed. What to do?

The teabag rallies are over and millions thousands hundreds turned out to protest the return to Clinton-era tax rates in 2010. Pathetic.

So here's a simple plan to make all their heads explode, based on the simple idea that they worship Ronald Reagan: instead of returning to Clinton's top marginal rate of 38%, let's return to Reagan's top marginal rate of 50%.

Better yet, let's return to Nixon's top marginal rate of 75%. Or Eisenhower's top marginal rate of 91%.

These were all popular Republican presidents. So why don't we return to good old-fashioned Republican tax rates?

By Dave Lindorff

As you’re mailing out that tax return again this year, it’s time to
remember once again how much of your hard-earned bucks are being devoted to destruction, imperialist domination, slaughter and
war, to funding ridiculous programs like the failed anti-missile
system, and also to supporting a massively bureaucratic and overstaffed
military.

Even with the current US budget predicted to hit a record $3.5
trillion, thanks to a whopping $800 billion, two-year economic stimulus
package, and with several hundred billion being poured into a group of
banks and the bottomless pit called AIG, the $800 billion budgeted for the military to date
(a figure that includes an $85 billion “supplemental” request for the
wars in Iraq and Afghanistan) represents 22% of total US spending.

Flyers to take to teabag rallies:

Large jpg. PDF. Word. Old Word.

Remember the massive outrage over bailout bonuses that got us peasants marching with pitchforks? On March 19, in a sweeping 328-93 vote, the House quickly enacted a 90% tax on $165 million in bonuses handed by AIG. But then bank lobbyists "moved into hyperdrive" and persuaded Senate leaders and President Obama to quietly crush our pitchfork movement.

As I argued yesterday, trying to break bonus contracts for AIG is a waste of time and money, both for the government and bloggers. It could also backfire bigtime, if departing AIG traders decide to blow up all the deals they created.

Instead of worrying about a measley $165 million, we should be worrying about how to pay for the trillions in total bailout costs. Rantin' Rick Santelli is exactly right this time:

This weekend we finally pried loose some secrets from AIG, the insurance giant that has cost U.S. taxpayers more in bailouts than any other financial institution.

First we learned 2/3 of our $160 billion went to foreign banks. Then we learned the  criminals in AIG's Financial Products Division - who did more to create the meltdown than anyone else in the world - are extorting enormous bonuses from the Treasury Secretary, under threat of blowing up the world financial system.

For the next few days, Washington and Wall Street will debate AIG bonuses. It's a powerful issue, but it really is a distraction because the total cost of the bailout is not $1 billion, it's in the trillions. And the key question is: who is going to pay these trillions - America's struggling middle class or the rich?

Obviously the rich should pay. First, they are the only Americans who can afford it. Second, they are the ones who are benefiting most from the trillions in bailouts, whether they are investment bankers guzzling $750 champagne or their investor clients.

So we need to tax the rich. But how? I propose a temporary surtax for millionaires. It would start immediately and end when all of the trillions in bailout funds are repaid in full.

By Dave Lindorff

The real cost of the Bush Administration’s trillion-dollar bailout
of Wall Street is becoming painfully apparent as the incoming Obama
administration attempts desperately to make a case for its own
$800-billion economic stimulus package, while warning about “trillion
dollar deficits as far as the eye can see.”