For House Budget Committee chairman Paul Ryan and the Republican Party’s unofficial austerity caucus, the shutdown and debt-ceiling fights did not end in defeat. As part of the deal to end reopen the government and avert a “full-faith-and-credit” crisis, they got an agreement to establish a House and Senate conference committee that is charged with pulling together a bipartisan budget plan.
Ryan makes little secret of his agenda. The Wisconsin Republican is already talking about implementing the “entitlement reforms” he’s been pitching for years. So no one should rule out the prospect that the committee will entertain proposals for the roll-the-dice experiments with Social Security, Medicare and Medicaid voucher schemes, hiking retirement ages, establishing means tests and reducing protections against inflation. At the same time, Ryan would reduce the corporate tax rate and eliminate the alternative minimum tax—completing the “Robin Hood-in-reverse” scenario that so appeals to austerity advocates.
But what are the prospects that the committee will discuss proposals that might attract the resources needed to avoid cuts to essential programs and steer the US economy toward job creation and growth? The Democrats make a bow in the right direction. In addition to investing in job creation, transportation infrastructure and worker training programs, Senate Budget Committee chair Patty Murray, D-Washington, includes proposals to close tax loopholes and eliminate tax breaks for corporations that offshore operations.
But if they are serious about countering austerity—and they should be—Democrats need to offer something more substantial. And the place to begin is with a real alternative to “Robin Hood in reverse.”
As in: a “Robin Hood Tax.”
That’s a tax on high-stakes financial transactions, as proposed in the House by Congressional Progressive Caucus co-chair Keith Ellison, D-Minnesota. Ellison’s “Inclusive Prosperity Tax” would raise hundreds of billions in new revenues. “This is a small tax on Wall Street transactions to meet the needs of our nation,” says Ellison, who asks: “Didn’t America step up to the plate when Wall Street needed help?”
The congressman’s proposal would also reduce harmful market speculation. As Ellison says, “Gambling on Wall Street does not benefit our society.”
This week in Washington, National Nurses United and 160 groups associated with the Robin Hood Tax Campaign are raising the issue in Washington. A Tuesday teach-in, featuring University of Massachusetts–Amherst economist Robert Pollin, former Texas Agriculture Commissioner Jim Hightower and labor leaders such as Amalgamated Transit Union president Larry Hanley, heard NNU co-president Jean Ross, RN, declare: “The nurses of America have a message for Wall Street: You have the money we need to heal America.” A Wednesday march, congressional briefing ( featuring economist Jeffrey Sachs and European parliamentarian Anni Podimata) and lobbying day will tell members of the US House and Senate that: “It’s not a Tax on the People. It’s a Tax for the People.”
And it’s about time.
This is a vital intervention in a debate that needs a fresh idea.
“With the latest Congressional super committee on budget deliberations about to meet in the aftermath of the brinkmanship over federal funding, a change in tone is needed in Washington,”says Karen Higgins, RN, an NNU co-president. “We are calling on Congress and the White House to refocus on a human needs budget, not just an endless cycle of more austerity and more cuts. We need the Robin Hood tax.”
Arguing for a Financial Transactions Tax does not only have the potential to shift the character of the budget conference committee deliberations. It could move the broader debate beyond the empty wrangling that pits Ryan’s austerity agenda against the austerity-lite response of too many Democrats.
“It’s far past time that we break this cycle and fund America. There is a simple solution: more revenue,” explains National People’s Action executive director George Goehl. “If the government had more money we could break the crisis fever that is killing our economic recovery and devastating most those who can afford it least.”
Goehl and NPA are making the case that a Robin Hood Tax could break the austerity cycle with “a tax of half of a percent or less on big Wall Street transactions [that] would not affect the retirement accounts for middle class and working families. The Robin Hood Tax could generate up to $350 billion each year for investments in America—health care, fighting HIV/AIDS, jobs, safety net, fighting climate change, and affordable housing.”
As NPA says: “It’s a small change for the banks, big change for us.”
That big change will be needed if the conference committee is to reach a budget agreement that rejects austerity in favor of the balance of fiscal responsibility and social responsibility that Americans have every right to demand.