A Robin Hood Tax to Pay for the Wars

Two weeks until Election Day, and no-one is talking about the wars,
the New York Timesreports.
(Of course, that's not quite true: as the Washington Postreports,
for example, this former
Army Green Beret is running for Congress in Missouri on a platform
of ending the war in Afghanistan.)

Unsurprisingly, the wars may have slipped down on many people's lists
of top concerns in the face of 9.5% officially measured unemployment
and the foreclosure crisis. But some people are talking about
projected U.S. budget deficits and what to do about them, and since
the permanent war is a major cause of projected budget deficits, that
means the permanent war is on the table.

Furthermore, a key question hanging over the election is this: in
America today, is it politically feasible to make the super-rich pay
their fair share of taxes? So far, the answer given to this question
by the election season seems to be no. Some Democrats thought that
they had a winning issue politically in allowing the Bush tax cuts on
the super-rich to expire, but, so far, it seems that they were wrong.

But here's a strategy that has not yet been fully explored: rather
than simply urge that the super-rich be required to pay their fair
share of taxes to support government expenditures in general, let's
demand that particular increased taxes on the super-rich be
earmarked to particular government expenditures that
the super-rich will have a hard time dodging politically. In Britain,
for example, there is a vigorous campaign to tie a particular tax
increase on the well-off to a particular set of needed social
expenditures. It's called, appropriately enough, the Robin Hood Tax.

Here in the US, Representative Bob Filner, chair of the House Veterans
Affairs Committee, has proposed
the creation of a "veterans trust fund" to pay for the long-term
costs of war. The logic of this proposal is straightforward. The wars
create a long-term liability for the government, because the
government is obligated to pay for the medical care of veterans for
the rest of their lives. The same logic that says that we ought to
worry about the long-term liability of the government to pay Social
Security benefits says that we ought to worry about the long-term
liability of the government to pay veterans' benefits. But in the case
of Social Security, there is a dedicated tax and a dedicated Trust
Fund. In the case of veterans' benefits, there is no dedicated tax and
no dedicated Trust Fund. So we ought to feel more urgency for
increased worry about veterans' benefits than about Social Security
benefits, because no provision has been made for veterans' benefits at
all.

So far, about 600,000
Iraq and Afghanistan veterans have already sought medical
treatment from the Department of Veterans Affairs, and 500,000 have
applied for disability benefits. Economists Joseph Stiglitz and Linda
Bilmes have estimated
the cost of providing Iraq and Afghanistan vets with lifetime medical
care and disability payments at between $589 billion and $934 billion,
depending on how long the wars continue and how many troops remain
deployed.

There's a strong case to be made that the super-rich should pay for this.

First, of course, there is the general fact that the super-rich have
more capacity to pay.

Second, there is the fact that the deaths and injuries suffered by
U.S. soldiers impose a burden disproportionately on the families of
less-privileged Americans, compared to the super-rich. It's not the
sons and daughters of the super-rich who are being blown up in
Kandahar. America's working families have already paid for the wars by
sending their sons and daughters. They have also paid through the
diversion of public resources from human needs to the
military-industrial complex. Fairness suggests that it's time for the
super-rich to pay.

Third, if we establish a mechanism for the super-rich to pay for the
wars, this will create a powerful disincentive for the wars to
continue, and will create a powerful incentive to avoid future wars.
When an Administration and its supporters in the corporate media start
to gin up a war fever, or insist that a current war must escalate or
be continued, the super-rich will say to themselves, "Whoa. We're
going to be expected to pay for this." And the super-rich will push
back. Since the super-rich have very disproportionate political
influence in our current political system, that will exert powerful
counter-pressure against the permanent war party.

As good fortune would have it, the Stiglitz/Bilmes estimate for the
cost of caring for veterans of the Iraq and Afghanistan wars is
roughly the same order of magnitude as the savings to the government
of allowing the Bush tax cuts on the richest Americans to expire:
"deficits and debt will be about $1 trillion higher over the next ten
years if the high-income tax cuts remain in place," the Center on
Budget and Policy Priorities reports.

So, instead of just saying that the Bush tax cuts for the richest
Americans should be allowed to expire, let's say that they should be
allowed to expire and that the money saved shall be earmarked for
the veterans trust fund. Note from the point of view of the
public interest, it's no loss to earmark the money, because we have to
pay for veterans' benefits no matter what we do. By dedicating the
money from the super-rich, we free up other resources for use
elsewhere.

Would our super-rich balk at paying for veterans' care? Are our
super-rich not American Patriots? Would our super-rich refuse to
Support the Troops?

And let's say further, that when the nation's obligation to its
veterans has been fully funded, we'll consider restoring the Bush tax
cuts for the super-rich. This will give the super-rich an incentive to
help us end the wars and prevent new ones.