Subject: [big campaign] New Huff Post from Creamer -- Tax Wall Street to Finance Jobs Program
From: [email-masked]
To: [email-masked], [email-masked]
Date: Mon, 11 Jan 2010 10:00:58 EST
List-Id: <bigcampaign.googlegroups.com>

Tax Bank Bonuses and Capital Gains of Wealthy to Pay for  Jobs Program 

This column is about pornography.  Yesterday’s New York Times ran  a front 
page story headlined: For Top  Bonuses on Wall Street, 7 Figures or 8.  The 
story was chocked full of  obscenity: 
“Bank executives are grappling with the question that exasperates, even  
infuriates, many recession-weary Americans: Just how big should their paydays  
be?” asked the Times. 
“Despite calls for restraint from Washington and a chafed public, resurgent 
 banks are preparing to pay out bonuses that rival those of the boom years,”
 it  continued. “The haul, in cash and stock, will run into many billions 
of  dollars.” 
“Industry executives acknowledge that the numbers being tossed around –  
six-, seven-  and even eight-figure  sums for some chief executives and top 
producers – will stun the many Americans  still hurting from the financial 
collapse and ensuing Great Recession.”   
“During the first nine months of  2009,” the Times reported, “five of the 
largest banks that received federal aid  – Citigroup, Bank of America, 
Goldman Sachs, JPMorgan Chase and Morgan Stanley –  together set aside about $90 
billion for  compensation.” 
The Times piece quotes a Wall  Street insider who apparently has avoided 
being infected by Wall Street’s  inability to see past greed and understand 
what’s going on in the real world.  John Reed, a founder of Citigroup  said: “
There is nothing I’ve seen that gives me the slightest feeling that these  
people have learned anything from the crisis…. They just don’t get it.  
They are off in a different  world.” 
I’d say. These people must  live on the planet Xenon.  Or  perhaps they are 
time travelers from the Palace of Versailles, before the French Revolution. 
 
Imagine a new, revised version of Moby Dick.  In this version, Captain Ahab’
s  obsessive pursuit of obscene wealth – rather than his pursuit of the 
Great White  Whale – has destroyed the ship and left all of the ship’s company 
in danger of  drowning.  But this time, the ship’s  crew valiantly salvages 
a lifeboat and rations – and rescues Ahab from certain  destruction.  
Now, in the last chapter, instead of acknowledging that his decisions led  
the ship to ruin, instead of thanking his crew for saving his life, he 
demands  that he receive a massively disproportionate share of the lifeboat’s 
rations –  hundreds of times that of the average sailor -- which he insists 
should be his  because “he, after all, is the captain – and the market for 
captain’s rations  demands it”.  
The author of this new version of Moby Dick has proposed two alternative  
endings to this saga.  All present  assume the captain is daft, and he is put 
under the supervision of the ship’s  dashing young doctor.  Or he is  
simply thrown overboard.    
What are these people thinking? Last month,  Americans lost an additional 
75,000 jobs and these people are arguing over  whether they get 7- or 8- 
figure bonuses for making brilliant trades at the  great Wall Street casino?  
When we say people are out of work, we are saying more than that they are  
not receiving income.  We’re saying  that they are not productively employed 
creating the wealth that contributes to  society’s well-being.  From the  
standpoint of the economy, the work that they would have done –the wealth 
that  they would have created while they are unemployed -- is gone forever.  
The real economy is made up of the total sum of that kind of real  work.  
It constitutes the sum total  of the energy and creativity of all of the 
construction workers, and teachers,  and doctors, and software engineers, and 
waitresses, and farmers – who actually  create real wealth – who provide the 
goods and services that we need to live  fulfilling lives.  
From the standpoint of creating real economic wealth – of making goods  and 
services – many of the people who are debating whether they get 7- or  
8-figures bonuses are actually  “unemployed”  themselves – or at least 
unengaged in  doing productive work.  They are not  creating new furniture, or 
driving a product to market, or writing a computer  program that helps cure a 
disease.  Many of them are simply betting on the price of one derivative, 
hedging  his bet with another derivative, taking risks with other people’s money –
 and  trying to become as rich as possible.  They are professional 
gamblers. From the standpoint of the economy, many  of them are parasites who simply 
feed off of other people’s labor.  
And what’s truly amazing is that, like our latter-day Ahab, it was their  
reckless pursuit of their own greed that destroyed the economy -- cost so 
many  others their livelihoods – and caused such massive waste in the economy 
at  large.  Many of those people who are  now unemployed – eager, but unable 
to contribute productively to our common  store of wealth – are unable to do 
so because these people – personally –  wrecked our economic ship.   
They – and their institutions – were rescued by the taxpayers – the  
people who actually produce wealth for a living.  Yet not a word of contrition.  
Not a thought that they don’t deserve  hundreds of times the income of 
average Americans -- a massively  disproportionate share of what’s left of the 
fruits of everyone else’s work –  even though the total economic pie has been 
diminished because of what  they did.   Amazingly,  they are now grabbing a 
larger share than ever.   
The real need in our economy is to put our fellow Americans back to work  – 
back to the task of creating goods and services – as soon as possible.  
Right now everyone in that lifeboat  needs to pull an oar.  And most  Americans 
desperately want to.   
The Federal Government needs to act immediately to get businesses to  
increase employment by stimulating more demand for its products – and to provide  
the funds to directly to employ people into productive activity through 
state  and local government  and the  Federal Government itself.  
The Federal Government is the only entity that can do this, and Congress  
will be shirking its most basic responsibility if it refuses to do  so. 
The first priority for Congress must be to get people employed.  Every day 
we wait to employ them, we  allow their labor to go to waste.  
Much of the cost of creating those jobs could be covered by following the  
lead of the British and imposing a big tax surcharge on the bonuses paid by 
the  big banks.  
Another portion could be paid by raising the income tax rate on capital  
gains to the same level as ordinary income for all the individuals making more 
 than $250,000 and the couples making more than $500,000. Be clear.  I’m 
not suggesting taxing the pension  income or college money of average 
Americans – just the capital gains of the  wealthiest Americans.  
About 70% of all capital gains goes to 3.5% of the population.  I’m 
suggesting that the wealthiest of  those pay taxes on capital gains at the same 
rate that they would if they got  the same income by working. 
When you think about it, it’s absurd that “ordinary income” – the income  
generated when you work for a living – is taxed at up to 35%, and “capital 
 gains” – income generated when your stocks, bonds, or derivatives 
appreciate –  is taxed at 15%.    
It makes no sense at all that the marginal income of a middle manager who  
makes $50,000 a year is taxed at 25%, and the income of a wealthy person who 
 spends his time on the French Riviera “day trading” on the stock market, 
is  taxed at 15%.  
The percentage of income going to the largely unproductive financial  
sector has skyrocketed in the last two decades.  Let’s tax that income to put the 
people  who actually produce goods and services back to work. 
To those who argue that this would reduce the incentive to come up with  “
innovative financial products” or clever trading schemes, I say that’s 
exactly  the idea: to decrease the incentives our economy provides for the best 
and  brightest to waste their careers gambling on Wall Street instead of 
doing  something productive for our economy.  
Ronald Reagan once famously said: “When you tax something you get less of  
it.”  Precisely.  America needs to tax speculation, and  incentivize 
productive work.  
And most importantly, nothing –  including increasing the deficit -- should 
stand in the way of a crash program  to put America back to work.  Nothing 
is more costly to our economy,  and our economic future, than the waste of 
unemployed Americans who are unable  to contribute to America’s store of 
wealth.  
Robert Creamer is a long-time political organizer and  strategist, and 
author of the recent book:  “Stand Up Straight: How Progressives Can Win,” 
available on _Amazon.com._ 
(http://www.amazon.com/Listen-Your-Mother-Straight-Progre
ssives/dp/0979585295/ref=pd_bbs_sr_1?ie=UTF8&s=books&qid=1213241439&sr=8-1)  
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