Campaigns are about a lot of things. But a winning presidential campaign must make clear how it will improve the lives of large numbers of Americans. A campaign has to lay out lots of policies, yes, on lots of different topics. But a winning presidential campaign must center on a simple, digestible policy statement, a concrete proposal for change that also connects to a broader theme unifying everything the candidate plans to do. Hence the title of my post, a suggested campaign theme for a Democratic presidential campaign: We'll cut your taxes and guarantee your health care.
These were the thoughts running through my mind after reading a couple of detailed data dives in recent days. Emmanuel Saez and Gabriel Zucman are economists at the University of California, Berkeley and advised both Elizabeth Warren and Bernie Sanders on their respective plans to tax the wealth of people at the very top. (Warren’s plan taxes wealth held above $50 million at a 2% rate per year, and dollars above $1 billion at 3%. Sanders’ plan starts a bit lower, at $32 million, and has more brackets, with wealth above $10 billion taxed at 8% per year.)
The aforementioned economists analyzed the overall tax burden paid in 2018—i.e., after the Trump Millionaire’s Tax Break, which we are now borrowing hundreds of billions per year to pay for, took effect—by Americans at 15 different levels of income. They included everything: federal (income and payroll), state, and local taxes, etc.—in other words, all the things people like Mitt Romney, Rush Limbaugh, and Sean Hannity forgot when they told lies about 47% of Americans being “takers” because they weren’t paying one particular kind of federal tax.
The shocking takeaway from Saez and Zucman was that the 400 wealthiest households in the U.S. pay a lower percentage of their annual income in taxes (23%) than those in the bottom 10% (who pay 25.6%)—or the rate paid by any other group, for that matter. Big-picture wise, explained the authors, we almost have a flat tax system. There is relatively little variation between the percentage paid by those who earn different levels of income. And at the very top end, where the truly obscene wealth accumulation is taking place, the authors wrote: “This is the tax system of a plutocracy.”
But it wasn’t always that way.
The U.S. tax code was once, as Saez and Zucman noted: “a beacon of tax justice. It was the democracy with the most steeply progressive system of taxation on the planet.” Look at how it has changed over the past half-century plus (see the graphic to the right). Note that the tax rate paid by those in the bottom 90% has increased, while it has dropped for those in the top 10%—with the drop moving higher and higher as we go up the income ladder. Those in the tippity-top sliver are paying half the rate they used to pay—back when America was, you know, great.
There are a lot of plans out there to make our tax code more progressive. 67.913% of those plans come from Sen. Warren [wink]. But seriously, plans to tax very high-end incomes and huge amounts of wealth are quite popular. Warren’s plan earned 3 to 1 (74% to 26%) support in one poll, for example.
Saez and Zucman put together a comprehensive proposal aimed at bringing back the progressiveness of our tax code that existed in 1950. They ran the numbers—and, notably, included the cost of health insurance in the tax rate Americans pay—which they called a “mandatory expense that is, in effect, a tax on working Americans.”
Their reworked tax code (see the graphic to the right), inclusive of health insurance costs, would reduce the tax rate paid by households in the bottom 95%. That’s a lot of voters. Those households with incomes that put them between 95%-99% would see a small (2.4%) increase. Only those making about $1 million per year or more would see bigger increases, with the biggest increases by far being paid by those in the top one-hundredth of the top 1% (i.e., those at 99.99% and above). And remember, we’re only talking about restoring rates that existed during the time of America’s strongest economy, the years right after the World War II.
In other words, Democrats can honestly tell most Americans that we will cut your taxes and guarantee your health care. This is how Sen. Warren explained it at the most recent Democratic debate:
Those at the very top, the richest individuals and the biggest corporations, are going to pay more. And middle-class families are going to pay less. That’s how this is going to work. What families have to deal with is cost, total cost. That’s what they have to deal with.
What we’re talking about here is what’s going to happen in families’ pockets, what’s going to happen in their budgets. And the answer is Medicare for All. Costs are going to go up for wealthier individuals, and costs are going to go up for giant corporations. But for hard-working families across this country, costs are going to go down, and that’s how it should work under Medicare for All in our health-care system.
I understand that for some of us progressives, talking about tax rates doesn’t feel as immediate, or perhaps as inspiring, as talking about some other issues. But making our tax code more progressive is one of the most direct ways elected officials can combat economic inequality. For most Americans, cutting their taxes and guaranteeing their health insurance coverage are real, tangible things that the federal government can do for them and their families simply by enacting new legislation. That’s why those issues need to be at the center of any campaign for national office. Furthermore, economic inequality is not just about dollars and cents, it’s about life and death.
That’s the other piece of data I want to highlight here (h/t Meteor Blades). There’s more detail in the article by Sam Pizzigati, including the fact that median household income, adjusted for inflation, was 2.3% lower in 2018 than it was in the last year of Bill Clinton’s presidency. By comparison, for the top 5% of households by income, it’s up 13%. And that disparity, as we know from other data, only increases the further up the income ladder we go. But here’s the information about how, as Pizzigati’s title states, “Inequality Is Literally Killing Us.”:
The disturbing new GAO research tracks how life has played out for Americans who happened to be between the ages of 51 and 61 in 1992. That cohort’s wealthiest 20 percent turned out to do fairly well. Over three-quarters of them — 75.5 percent — went on to find themselves still alive and kicking in 2014, the most recent year with full stats available.
At the other end of the economic spectrum, it’s a different story.
Among Americans in the poorest 20 percent of this age group, under half — 47.6 percent — were still waking up every morning in 2014. In other words, the poorest of the Americans the GAO studied had just a 50-50 chance of living into 2014. The most affluent had a three-in-four chance.
Warren has also, as I’ve written previously, shown how to integrate the fight for racial justice and the fight against economic inequality. The two are linked both in terms of the policy changes we need, and in the way conservatives use race-baiting rhetoric to prevent the formation of a majority coalition of middle- and working-class whites and voters of color, built around their real shared interests. A Democratic campaign that says it will cut your taxes and guarantee your health care also must talk about issues of racial justice, and other forms of injustice, without question.
In fact, all these themes do connect. Democrats are the party that fights for all Americans—white, black, brown, and everything else—to make this country fairer, more just, safer, and more prosperous for everyone. The Republicans, on the other hand, are the party that favors those at the very top—while driving a wedge between the rest of us. That’s a winning message that will not only defeat Donald Trump (or his replacement, if his congressional allies actually develop the courage to put country first), but defeat Republicans up and down the ballot.
Ian Reifowitz is the author of The Tribalization of Politics: How Rush Limbaugh's Race-Baiting Rhetoric on the Obama Presidency Paved the Way for Trump (Foreword by Markos Moulitsas)