Politicians In Service To The Wealthy

Looks like Pelosi fell right into the transparent trap the Republican wing of the Democratic Party set up. Manchin and Sinema got together with No Labels’ “Unbreakable 9” — now 10 — and got her to agree to a date-certain vote of the “bipartisan”/all conservative hard infrastructure bill even as Manchin and Sinema prevented the wildly popular– albeit not with the billionaire class– companion human infrastructure bill from moving along for the simultaneous passage most Democrats have insisted on. The trap, of course, leads to passage of the conservative bill and then a defeat for the far more transformative $3.5 trillion bill, which Manchin says he will cut down in half. He is particularly interested in wrecking the Climate Crisis amelioration parts of the bill.

Sinema, meanwhile — one of the most corrupt members of the Senate (along with Manchin) — just wants to destroy anything that would help working families or discomfort the wealthy donors who have made her a rich woman since she was elected. Yesterday, a team of Politico writers reported that this is a huge win for both the Republicans and the shit-eating conservative Democrats in both chambers. Hoyer’s announcement this morning effectively decouples the two bills, officially spiking the so-called ‘two-track’ process that leadership hoped would enable passage of both while keeping the party united and that Biden publicly promised.

“We will be putting [the BIF] on the floor on the 27th, that’s next Monday,” House Majority Leader Steny Hoyer told reporters in a rather newsy pen-and-pad this morning, though he also noted that the vote could slip one day. As for the reconciliation package, the Maryland Democrat said the House will move “as soon as it’s ready” — though no one seems to know when that will be. The obvious big follow-up question here: What will progressives do? Several high-profile members on the left are almost certainly going to vote against this thing — some, like Rep. Alexandria Ocasio-Cortez (D-NY), have made their unhappiness with this new process abundantly clear. But the question is how many, and can leadership — and President Joe Biden — convince enough to go along with this new plan?

In a closed-door caucus meeting this morning, Democratic leaders implored their members to stick together. But that’s easier said than done — especially when House progressives view the BIF vote as their best leverage to force [corrupt right-wing scumbag] Democrats to support the reconciliation package.

Hoyer in his pen-and-pad pushed back on the argument, saying that he hoped “every Democrat votes for both bills.” “I don’t agree with the judgement of those who believe that it would somehow compel the [corrupt right-wing scumbag] wing of the caucus to be more supportive,” he added.

Schrader & Gottheimer are doing exactly what their big donors expect of them

Pelosi and Hoyer know they will lose enough progressive votes to defeat the bill unless they can persuade at least a dozen or two House Republicans to cross the aisle, something that looks doable since it’s a very conservative bill that shouldn’t offend any Republicans other than ones who just want to tank anything Biden tries to accomplish.

Also yesterday, Robert Reich gets right to the world view that helps explain why the Republican wing of the Democratic Party is determined to kill Biden’s agenda: Why Are House Democrats So Reluctant to Tax Wealth? He reminded his readers that last week, because of several corrupt conservative Democrats making common ground with all the Republicans, the House Ways and Means Committee “didn’t go after the huge accumulations of wealth at the top — representing the largest share of the economy in more than a century. You might have thought they’d be eager to tax America’s 660 billionaires whose fortunes have increased $1.8 trillion since the start of the pandemic — an amount that could fund half of Biden’s plan and still leave the billionaires as rich as they were before the pandemic began…

But House Democrats on Ways and Means decided to raise revenue the traditional way, taxing annual income rather than immense wealth. They aim to raise the highest income tax rate and apply a 3 percent surtax to incomes over $5 million.” Yet the dirty little secret — which House Democrats certainly know — is the ultra-rich don’t live off their paychecks. Jeff Bezos’s salary from Amazon was $81,840 last year, yet he rakes in some $149,353 every minute from the soaring value of his Amazon stocks — which is how he affords five mansions, including one in Washington D.C. with 25 bathrooms.

House Democrats won’t even close the gaping “stepped-up basis at death” loophole, which allows the heirs of the ultra-rich to value their stocks, bonds, mansions, and other assets at current market prices — avoiding capital gains taxes on the entire increase in value from when they were initially purchased.
This loophole allows family dynasties to transfer ever larger amounts of wealth to future generations without it ever being taxed. Talk about an American aristocracy. We’re on the cusp of the largest inter-generational transfer of wealth in American history, as rich boomers pass it on to their millennial heirs. Closing this loophole may be our one big opportunity to stop this new aristocracy in its literal tracks.

Biden wanted to close this loophole, but House Democrats balked. You might also have assumed they’d target America’s biggest corporations, awash in cash but paying a pittance in taxes. But remarkably, House Democrats have decided to set corporate tax rates below the level they were at when Barack Obama was in the White House. Hell, Democrats even kept a scaled-back version of private equity’s “carried interest.” And listen to this: they retained special tax breaks for oil and gas companies. What’s going on here? It’s not that House Democrats lack the legislative power. They’re in one of those rare trifectas when they hold a majority of the House plus a bare majority of the Senate and the presidency.

It’s not the economics. Americans have been subject to decades of Republican “trickle-down” nonsense and know full well nothing trickles down. Billionaires hardly need to have their fortunes grow $100,000 a minute to be innovative. And as I’ve stressed, there’s more money at the top, relative to anywhere else, than at any time in the last century. Besides, Democrats need the revenue to finance their ambitious plan to invest in childcare, education, paid family leave, health care, and the climate. So what’s holding them back? Put simply, Democrats are reluctant to tax the record-breaking wealth of the rich and big corporations because of … the wealth of the rich and big corporations.

Many Democrats rely on that wealth to bankroll their campaigns. They also dread becoming targets of well-financed ad campaigns accusing them of voting for “job killing” taxes. (For the record, there’s no evidence that tax increases have “killed” jobs, especially when those tax increases have been targeted at higher incomes.) Republicans have been in the pockets of moneyed interests at least since they championed Reagan’s tax cuts, regulatory rollbacks, and dismantling of labor protections. But the timidity of House Democrats shows just how loudly big money speaks these days even in the party of Franklin D. Roosevelt.

That’s partly because there’s so much less money on the other side. Through the first half of 2021, business groups and corporations spent nearly $1.5 billion on lobbying, compared to roughly $22 million spent by labor unions, and $81 million by public interest groups, according to OpenSecrets.org. Plus, the anti-taxers are well-organized. Thousands of industry groups, platoons of trade associations, every large corporation in America, along with small business associations — all are marching in step against corporate tax increases. There’s no similar pressure on the other side. How many pro-corporate-tax organizations can you name?

Progressive House Democrats will still have their say (AOC and other progressives will demand something more from the super-rich) and Senate Democrats haven’t yet weighed in (I’m sure Elizabeth Warren will continue to push her wealth tax). But so far, the House Ways and Means Committee is where it all begins. Let me step back a bit. The looming debate over taxes is really a debate over the allocation of wealth and power in America. As that allocation becomes ever more grotesquely imbalanced, this debate over wealth and power will loom ever larger over American politics. Behind it will be this simple but important question: Which party stands up for average working people? Democrats, take note.

Late yesterday, after a long meeting with Pelosi in her office, Pramila Jayapal told me that “The long-held position of our Progressive Caucus remains unchanged: we are happy to enact the President’s entire Build Back Better agenda that voters put us in the majority to deliver on but we will only vote for the infrastructure bill after passing the reconciliation bill that invests in child care, paid leave, health care, education, housing, climate action, and more. Congress must move urgently to send both pieces of this popular, necessary, and transformational package to the President’s desk so we can make a real difference in people’s lives.” And she says she has the votes — at least 48 — to keep the conservative infrastructure bill from passing if it isn’t tied to the human infrastructure bill. I sure hope so! But you know who doesn’t? Keep reading.

It would be hard to imagine Sinema winning a Democratic primary in Arizona. It would be hard to imagine her walking down the street without getting spat on. Yesterday, Josh Marshall reported that she’s positioning herself as an independent. Despite speculation, he asserts she is not angling for a high dollar lobbying gig but plans to try to stay in office. One of his Arizona-based contributors wrote that “The way she’s responded to the complete and utter collapse in her Democratic-leaning support by doubling-down on her ‘independent’ image tends to support the idea that she doesn’t care about losing the Democratic primary because she doesn’t think she needs that many Democrats to win it. There are more registered Independents in Arizona than Democrats so she may be right.

The [Blue Dog] Center Forward PAC has been running a lot of local radio ads here about her bi-partisanship and the infrastructure bill. I’ve received two mailers in the last two weeks already claiming credit for all that good the bi-partisan infrastructure bill is going to do for the state. Every radio ad and piece of mail even requests that you call and tell her to ‘keep fighting as an independent voice for Arizona’s economy.’ She’s already building that list of independents who she’ll count on to vote for her during the primary.

I think she would probably be more than willing to blow up the reconciliation bill by saying it’s not bi-partisan and she has to do it to save Arizona’s economy, but the one small piece of leverage against her doing that is that the gains from the bi-partisan infrastructure deal are being advertised so heavily for her. If both bills fail, then there’s a lot of congratulatory advertising that blows up in her face and makes that ‘independent, bi-partisan who delivers for Arizona’ message a lot harder to run on in a few years. At that point, I think she’d embrace ‘independents’ even more closely since she doesn’t seem like the type to try to mend fences.

Then pray that all of the Republican Party primary candidates are such disasters that the independents flood the Democratic primary and enough Democratic party voters go for the incumbent since they know she can win. Safety over a desire for something better gets her over the finish line. I think she’s badly miscalculated the moment and what she could have been as Arizona changes, but she’s been winning with her approach for over a decade. Don’t expect her to abandon it now.