Robert Reich

Higher Taxes Hurt Job Creators? That's Malarkey.

As we go into the final days of a dismal presidential campaign where too many issues have been fudged or eluded—and the media only want to talk about is who’s up and who’s down—the biggest issue on which the candidates have given us the clearest choice is whether the rich should pay more in taxes. President Obama says emphatically yes. He proposes ending the Bush tax cut for people earning more than $250,000 a year, and requiring those with high incomes to pay in taxes at least 30 percent of any income over $1 million (the so-called “Buffett Rule”). Mitt Romney says emphatically no. He proposes cutting tax rates by 20 percent, which would reduce taxes on the rich far more than anyone else. He also wants to extend the Bush tax cut for the wealthy, and reduce or eliminate taxes on dividends and capital gains. Romney says he’ll close loopholes and eliminate deductions used by the rich so that their share of total taxes remains the same as it is now, although he refuses to specify what...

How January's Fiscal Cliff Turns into a Gentle Hill by February

Regardless of what happens on Election Day, at the beginning of next year more than $600 billion in tax increases and spending cuts automatically go into effect. That’s equivalent to about 5 percent of the entire U.S. economy—more than the projected growth of the whole gross domestic product next year. The problem is, if we fall off this fiscal cliff, we plunge into recession. That’s because the cliff withdraws too much demand from the economy too quickly, at a time when unemployment is still likely to be high. The Congressional Budget Office projects real economic growth will drop at an annual rate of 2.9 percent in the first half of 2013, and unemployment will rise to 9.1 percent by the end of next year. As Spain and Great Britain have demonstrated, launching fiscal austerity at a time when a nation’s economic capacity is substantially underutilized causes the economy to contract. This makes the debt even larger in proportion to the size of the economy. Rather than reassure global...

Memo to Joe, Re: Debate

TO: VPOTUS FROM: Robert Reich RE: Debate Beware: Paul Ryan will appear affable. He’s less polished and aggressive than Romney, even soft-spoken. And he acts as if he’s saying reasonable things. But under the surface he’s a right-wing zealot. And nothing he says or believes is reasonable—neither logical nor reflecting the values of the great majority of Americans. Your job is to smoke Ryan out, exposing his fanaticism. The best way to do this is to force him to take responsibility for the regressive budget he created as chairman of the House Budget Committee. Ryan won’t be able to pull a Romney—pretending he’s a moderate—because the Ryan budget is out there, with specific numbers. It’s an astounding document that Romney fully supports. And it fills in the details Romney has left out of his proposals. Mitt Romney is a robot who will say and do whatever he’s programmed to do. Ryan is the robot’s brain. The robot has no heart. It’s your job to enable America to see this. I suggest you...

The Politics of the Jobs Report

The White House is breathing easier this morning. The Bureau of Labor Statistics reports the unemployment rate dropped to 7.8 percent—the first time it’s been under 8 percent in 43 months. In political terms, headlines are everything—and most major media are leading with the drop in the unemployment rate. Look more closely, though, and the picture is murkier. According to the separate payroll survey undertaken by the BLS, just 114,000 new jobs were added in September. At least 125,000 are needed per month just to keep up with population growth. Yet August’s job number was revised upward to 142,000, and July’s to 181,000. In other words, we’re still crawling out of the deep crater we fell into in 2008 and 2009. The percent of the working-age population now working or actively looking for work is higher than it was, but still near a thirty-year low. But at least we’re crawling out. Romney says we’re not doing well enough, and he’s right. But the prescriptions he’s offering—more tax cuts...

The First Presidential Debate

In Wednesday night’s debate, Romney won on style while Obama won on substance. Romney sounded as if he had conviction, which means he’s either convinced himself that the lies he tells are true or he’s a fabulous actor. But what struck me most was how much Obama allowed Romney to get away with: Five times Romney accused Obama of raiding Medicare of $716 billion, which is a complete fabrication. Obama never mentioned the regressiveness of Romney’s budget plan—awarding the rich and hurting the middle class and the poor. He never mentioned Bain Capital, or Romney’s 47 percent talk, or Romney’s “carried-interest” tax loophole. Obama allowed Romney to talk about replacing Dodd-Frank and the Affordable Care Act without demanding that Romney be specific about what he’d replace and why. And so on. I’ve been worried about Obama’s poor debate performance for some time now. He was terrible in the 2008 primary debates, for example. Expectations are always high—he’s known as an eloquent orator. But...

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