This piece is the third in a six-part series on taxation, and a joint project by The American Prospect and its publishing partner, Demos.
As the White House mounts a major campaign to sell the “Buffett Tax” this week, there is another, better tax on the 1 percent that Washington should be considering: A financial-transaction tax—better known as a financial speculation tax (FST).
Later this afternoon, in Florida, President Obama will make his push for the Buffet rule, a policy which would ensure a minimum 30 percent tax rate for individuals making more than $1 million per year. There’s no chance that it will pass either chamber of Congress, but that’s not the point; the proposal is meant to place Democrats on the side of tax fairness and present the GOP as tied to the interests of the wealthy Americans. The Republican response is that this is an attempt to draw attention away from the economy and its sluggish performance over the last three years.
We’re entering the 99 percent spring, with escalating actions starting across the country next Tuesday targeting America’s biggest tax dodgers. On April 24, shareholder actions will begin at General Electric, Wells Fargo, Bank of America, and dozens of other corporations. Americans are renewing the fight to fix our economy and to hold the big banks accountable for the misdeeds that have left millions out of work and out of homes.
Whenever Paul Ryan speaks on the need to reform the welfare state, he declares that what the United States needs is a social safety net, and not a hammock. The idea is easy to understand: A net is meant as a last resort, to keep you from serious danger; a hammock, by contrast, is designed to keep you comfortable or—in Ryan’s words—“lull able-bodied people to lives of dependency and complacency.”
Although the economy is still improving at a glacial pace, as evidenced by this month's slowing job growth, companies and CEOs have returned to their pre-recession heights, with a stock market at a four-year high to match. In 2007, S&P 500 companies created an average of $378,000 in revenue for every employee. Last year, that number was $420,000. Top executives are doing okay too—the median income of the top 100 CEOs is $14.4 million.
The economy added 120,000 nonfarm jobs in March—far less impressive growth than February's 240,000 jobs, which were revised upward from last months estimate of 227,000. The unemployment rate dropped 0.1 percent to 8.2 percent, according to today's Bureau of Labor Statistics report. Economists had predicted that 205,000jobs would be added in March. The numbers released today are far lower than expectations, and the +150,000 threshold needed to keep job growth at pace with population growth.
For the March jobs report, economists were expecting another month where the economy grew by more than 200,000 jobs. Instead, what we received—according to the Bureau of Labor Statistics—was a disappointing backslide into the anemic months of last fall. The economy created 120,000 jobs in March, a huge drop compared to previous months. At the same time, however, the unemployment rate dropped to 8.2 percent.
In the week that ended March 31, jobless claims droppedto 357,000—the lowest they have been in four years, according to new numbers from the Labor Department. Pennsylvania posted the biggest drop in claims—1,956—while Texas posted the highest jump—4,185. The steady gains that have been happening since the fall are likely due to fewer layoffs and the strengthening of the labor market, as proved once again by last month's private-sector jobs numbers.
Auto sales were on the upswing in March, thanks to a thirst for fuel-efficient vehicles and the unseasonably warm weather. Automakers sold 1.4 million light vehicles last month, with hybrids and more efficient models leading the way. General Motors sold over 100,000 models that get 30+ miles to the gallon—accounting for almost half of the 231,052 cars sold in March. U.S. sales on Toyota Prius hybrids jumped 54 percent last month to 28,711 cars—a record for the company. Chrysler had the best month of sales it has had in four years—a 34 percent jump from this time last year.
A new report from the Institute for Supply Management shows that manufacturing employment reached a nine-month high in March, and that the manufacturing sector is on a 32-month growth streak. The steady growth in the United States is a marked contrast from Europe, where manufacturing hit a three-month low last month. The healthy manufacturing numbers released yesterday are further fueling economists' predictions that the March jobs numbers—scheduled to be released Friday—will again top 200,000.
Americans committed to development and to the U.S. playing a positive role on the global stage should encourage President Barack Obama to announce his support for an open, transparent, and meritocratic process in selecting the next leader of the World Bank. In the past, other countries have simply deferred to the U.S. to nominate a new head, whose selection was then followed by a pro forma up-or-down vote by the World Bank’s board. The U.S. has now nominated Dr. Jim Yong Kim, currently president of Dartmouth. In part because of the disastrous consequences of Bush ramming through Paul Wolfowitz, who later was forced to resign, other countries put forward nominees, including the Africans also put forward a nominee: Ngozi Okonjo-Iweala.
Eurostat—the European Union's statistics agency—says unemployment in the eurozone went up by 162,000 in February. Total unemployment reached 17.134 million—10.8 percent—after ten straight months of rising, the highest recorded figure since the data began being compiled in January 1995. "We expect it to go higher, to reach 11 percent by the end of the year,” said Raphael Brun-Aguerre, an economist at JPMorgan. “You have public sector job cuts, income going down, weak consumption. The economic growth outlook is negative and is going to worsen unemployment.”
Everyone involved in politics knows that there is almost nothing the president can do to affect the price of gasoline. Democrats know this. Republicans know this. People in the oil industry certainly know this. But they all, at various times, play a game in which they try to deceive the American public into believing something they know to be false. So right now, an oil industry group is running ads saying the high price of gas is Barack Obama's fault (you'll be shocked to hear that the ubiquitous Koch brothers are involved). Republican leaders are saying the increasing price at the pump is Obama's fault. And what about the public? Are they buying it?
The polls we've seen so far actually show that the answer is, not really...
Becki Jacobson, 48, has worked as a process technician at American Crystal Sugar Company in Minnesota since she was 18. Eight months ago, she showed up for work, but the company refused to let her start her shift.
Like 1,300 other members of the Bakery, Confectionery, Tobacco & Grain Millers union (BCTGM) at American Crystal Sugar, Jacobson wasn’t fired. She was locked out. Crystal Sugar is wielding a powerful weapon against its workers: Its right to deny them work for refusing a worse contract after their existing one expired. Jacobson and her co-workers are left with a choice. They can hold out while non-union workers do their jobs, make huge concessions, or dissolve the union.