Are the rich too rich?

A recent editorial in Fortune magazine (“How to Run a Budget Like An Idiot”, by Matt Miller, 6-25-07) summed up my beliefs on the current situation in the US in regards to income distribution. While I am far from a socialist or communist and am not a fan of income redistribution, I do think the system needs to be tweaked to make it more fair.

According to the article, new census data shows that the top 1% of US wage earners now take home a greater share of national income than at any time since the 1920s, and Republicans seem to be trying to match the inequity hit by Louis XVI, which led to a little thing called the French Revolution (which, unlike the American one, was a real revolution).

Will it change with new leadership? It doesn’t appear so. GOP presidential candidates not only want to keep the status quo, they have discussed more tax breaks. All of this while our deficit spirals out of control and spending continues with no relationship to income coming in (one of the biggest myths of politics is that Republicans are about small government and fiscal responsibility; maybe in Barry Goldwater’s time, but Ronald Reagan put an end to that, and Bush has taken it to new heights).

Ben Stein, in another interesting article in this same issue of Fortune, said if we managed our budget like the government, we would be broke and probably in jail. “They (conservatives) try and try to say we can do it (balance the budget) by cutting spending, and they never do.”

In the article, Miller points out that we’ve borrowed nearly $2 trillion in the past six years under Bush to cut taxes for the wealthiest in a time of war where spending has increased, meaning “we’ve slipped the bill for our war and our tax cuts to our kids.”

He also points out that while the top 5% of earners do pay about 58% in federal income taxes, Republicans who quote this number forget that income tax is only 47% of federal revenue today. So, when you throw other federal taxes into the mix, which tend to hit lower wage earners harder, you find that the top 5% make about 30% of the income and pay 40% of the overall federal taxes.

So, while the rich do pay more than their share and the US does have a progressive tax system, it clearly isn’t enough if we are headed towards an environment that historically leads to revolutions, and I don’t mean that figuratively.

It would be prudent for those in power in the US, regardless of political affiliation, to recognize this trend, acknowledge it is a bad one, and fix it, before it is fixed for them. And it would be good if Republicans would begin practicing what they preach. I may not like the fact that Democrats want a huge government and corresponding huge budget, but at least you get what you voted for.

How the Republicans continue to get votes from mid-to-lower income people in the Midwest and South is beyond me. I need to read the book that described this phenomenon that came out a few years ago… I think it was called “What is wrong with the people in Kansas?”

Book Review of Bush at War by Bob Woodward

This book is the first of three by Woodward about the Bush administration. Bush at War starts with the attacks from 9-11, covers the war in Afghanistan, and ends with a brief excerpt about the decision to go into Iraq (which is covered entirely in Book 2 of the series), and includes several interviews with President Bush and his administration, plus detailed notes and quotes from internal meetings within the administration.

This book is a must read for all Americans, whether you like Bush or not, because if gives unique insight into how the Bush administration made its decisions, with direct conversations from all the major players, including the CIA, FBI, foreign leaders, etc. At times you wonder what dirt Woodward had on people to get this much access and information, but his level of detail and insight into the decision to go to war and how to fight it is fascinating.

Some highlights:

• It was clear that al Qaeda was not a top priority for the Bush administration when they took over the White House, even though this was identified by the CIA and director George Tenet as one of the top three threats facing the nation when Bush took the presidency.
• After 9-11, the philosophy of the administration changed. Ashcroft shifted the FBI and the justice department from prosecution to prevention, which was a radical shift in priorities. Bush told Tenet that he could spend whatever he wanted to in order to get info and resources in the middle east, a significant change from the Clinton administration. And the role of the US in the world was to preemptively prevent any future terrorist attacks on the US.
• Bush never engaged the American public on the war on terror, never asking them to sacrifice as Roosevelt and Lincoln did. Ironically, this could have been the reason why Americans ultimately turned against the war. Shortly after 9-11, Bush said that in a month Americans would be watching football and the World Series (p. 45, in paperback version), so why he never decided to sell the war to the American public is beyond me (he instead infamously asked Americans to keep shopping).
• The Iraq obsession of Rumsfield, Cheney, and Paul Wolfowitz, Rumsfield’s deputy, was present from day one, immediately after 9-11. Not coincidentally, all of those three were key players in the first Gulf War. It was obvious that the obsession these guys had with removing Saddam from power eventually convinced the President it was the right decision to go to war with Iraq. A month after 9-11, Rumsfield was asking about going into Iraq to fight the war on terror in round one (49).
• Bush never had a problem with the US going at it alone, in Afghanistan or Iraq, although Colin Powell was never eager to go that avenue. Bush: “At some point, we may be the only ones left. That’s okay with me. We are America.” (81).
• Powell was always at odds with just about everyone in the Bush administration, specifically Cheney and Rumsfield, even though he held a very esteemed position as Secretary of State. He never had a great relationship with Bush. This relationship became a bigger gap as the Iraq issue dominated, and ultimately resulted in Powell leaving the administration.
  Rumsfield was always against using the US military for nation building. Ironically, it was the failure of the US military to rebuild Afghanistan and Iraq that he received the most criticism for and ultimately led to his dismissal as Secretary of Defense. While the US military did an incredible job of invading and capturing both countries (in all, the US commitment to overthrow the Taliban had been about 110 CIA officers and 316 Special Forces personnel (314), plus massive airpower- no ground troops), clearly the Bush administration failed with the execution of what to do, once the coup took place.
  
  Bush also said he opposed using the US military for nation-building (237), but obviously Iraq and Afghanistan would collapse into civil war if the US pulls out, so a great history question will be: How did the Bush administration not see that, and what did they expect to happen that clearly did not, leaving the US in the lose-lose situation that will forever define his presidency?
• Bush’s leadership style bordered on the hurried (256). He wanted actions, solutions. Once on a course, he directed his energy at moving forward, scoffing at doubt and anything less than 100% commitment. This is no surprise to critics of Bush, who feel he picked people based on loyalty instead of competence, and as a result was slow to dismiss Rumsfield, Tenet, Gonzalez, Ashcroft, etc., when everyone else thought their time was passed. And, of course, Bush still refusing to admit the war in Iraq was a mistake.
• Two of the biggest criticism in the Afghanistan campaign has been the allegiance with the Northern Alliance tribes and the treatment of prisoners at Gitmo. A related note in these two topics is money; the CIA spent $70 million dollars bribing people in Afghanistan to get information, obtain prisoners, even make people move from point A to point B. Tenet was “extremely proud” of what the CIA had accomplished, and no doubt the CIA was breaking into new ground around the world obtaining information it otherwise had no access to. Eventually thousands of people and suspects were rounded up and put in Gitmo, but how reliable is the info and prisoners, when the people you pay to give them up are themselves possibly criminals and drug lords, and have something to gain by turning in a rival? While most would agree the Northern Alliance is better than al Qaeda, there may still be a price to be paid for the relationship the US has with the Northern Alliance, held together only by money and a hatred of al Qaeda.
• Bush’s vision is the reordering of the world through preemptive and, if necessary, unilateral action to reduce suffering and bring peace (341). “We’re never going to get people all in agreement about force and use of force,” Bush said. Bush found that protecting and sealing the US homeland was basically impossible, and the country is only marginally safer today, despite all of the increased security and regulations. As such, the policy of preemptively striking a country that harbors terrorists was believed to be the only way to prevent another 9-11 on US soil.