Fiscally Stiffed in the New Year

Posted on January 8th, 2013 by Lauren Gutterman
 1 comment  

VaidUrvashi Vaid is Director of the Engaging Tradition Project at the Center for Gender & Sexuality Law, and the author of Irresistible Revolution: Confronting Race, Class, and the Assumptions of LGBT Politics. The following blog entry was posted on her website on January 1st:

Washington’s impasse on fiscal issues is a story that feels like the movie Groundhog Day. Since President Obama got elected, opposing and undermining anything he proposes has been the main objective of the GOP. We are in today’s fiscal cliff moment because the Republican right wing refuses a balanced approach to solving the fiscal challenges facing the country. The party of No (as Kate Clinton calls them) punted till after the election thinking that Mitt would win but the script did not go as planned. Darn those young people, people of color, women voters, gay voters and progressive 47%-ers.

Predictably, the mainstream story being told is one about the wealthy and the powerful, about their lives, about abstract pledges made to beltway lobbyist Grover Norquist, about lofty sounding notions of freedom from government taxation and glorifications of the Tea Party, a “movement” manufactured and financed by lobbyists for the wealthy, whose Congressional mouthpieces are financed by Wall Street power brokers.(1)

The story ought to be about the hypocrisy of the anti-tax zealots. Their stall tactics will raise taxes and burdens on the millions of working class and middle class people, while demanding that those same people live under a deteriorating public infrastructure, and receive fewer social services and support than ever.

It is astonishing that Congress is arguing about whether the deal-breaker should be increases in taxes for those making $550,000 and above or $250,000 –about 4.2% of all Americans. (2) What about the remaining 96% — how will they be affected by the cuts being proposed? Congress refuses to increase the capital gains tax on earnings from stock market investments from the ridiculous 15% level to 20%. In either instance, still a lower tax rate for the billionaire earning income on investments than is paid by the firefighter earning $36,000 salary – that person’s tax rate would be 28% in 2013.(3)

Spending cuts in social services are politically popular since PauL Ryan became the poster child for American austerity. But the irony about the so-called “austerity” is that in the US, it is always all about cutting back on supports for the poor and the middle class, not the rich and certainly not the corporations. Rich people and corporate prop-ups like estate tax gimmicks, luxury goods exemptions, loop holes that allow untaxed off shore investments, low capital gains taxes, gift tax exemptions, subsidies for all sorts of industries (oil, gas, defense, agribusiness, pharmaceutical industries to name just a few that are subsidized by tax dollars) are considered sacrosanct by the GOP and their Democratic lapdog counterparts. Poor and middle-class people prop-ups like food stamps, unemployment insurance, support for public universities, Medicare, Medicaid, public support for housing and schools are always what are on the chopping block.

Calls for spending cuts are popular because the average Jane and Joe mistakenly think these cuts will not affect their lives.

America has always been austere for poor people – the rash and drastic cuts made in the 1980’s by Reagan era Democrats and Republicans, in the 1990’s by the first Bush and the pandering to the right Administration of Bill Clinton, and by the 2nd Bush have left poor and vulnerable people worse off than they have been in decades.(4) The new austerity demanded by Ryan, Norquist, Eric Cantor and all those who profess to care about debt, will extend this misery to middle class people.

The middle class, working people and low-income people, actually, all those making less than $200K a year, are being fiscally stiffed. Under the guise of protecting ordinary people, the lobbyists for the rich are poised to enact laws that would truly destroy this country’s civic fabric by undermining the social support that millions of people need.

(1) “Wall Street Funds Tea Party Stars,” The Boston Globe, May 1, 2012,; See also, SourceWatch on the Tea Party,

(2) Ron Scherer, Obama Tax Proposal : Who Makes More than $250,000 and are they Rich, Christian Science Monitor, July 10, 2012,

(2) Urban Institute and Brookings Institution, Tax Policy Center,

(3) CNN News, Median Income Falls, But so Does Poverty (from 15.1% to 15%),

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