Professor Richard Wolff: Capitalism and Democracy: Year-End Lessons

[marmar]

Capitalism and Democracy: Year-End Lessons

Wednesday, 18 December 2013 09:12
By Richard D Wolff, Truthout | News


2013 drove home a basic lesson: US capitalism's economic leaders and their politicians now regularly ignore majority opinions and preferences. For example, polls showed overwhelming popular support for higher taxes on the rich with lower taxes on the rest of us and for reversing the nation's deepening economic inequalities. Yet Republicans and Democrats, including President Obama, raised payroll taxes sharply on January 1, 2013. Those taxes are regressive; they take a smaller percentage of your income the higher your income is above $113,700 per year. Raising the payroll tax increased economic inequality across 2013.

For another example, many American cities and towns want to use eminent domain laws to help residents keep their homes and avoid foreclosure. Eminent domain is a hallmark democratic right as well as US law. It enables municipal governments to buy individual properties (at market prices) when doing so benefits the community as a whole. Using eminent domain, local leaders want to compel lenders (e.g., banks, etc.) to sell them homes whose market prices have fallen below the mortgage debts of their occupants. They would then resell those homes at their market prices to their occupants. With their mortgages thus reduced to their homes' actual prices, occupants could stay in them. They still suffer their homes' fallen values but avoid homelessness. Communities benefit because decreased homelessness reduces the fall of other property values, reduces the number of abandoned homes (and thus risks of fire, crime, etc.), reduces the number of customers lost to local stores, sustains property tax flows to local governments and so on.

Used this way, eminent domain forces lenders - chiefly banks - to share more of the pains produced by capitalism's crisis. Most Americans support that, believing it will help reverse income and wealth inequalities and also that banks bear major responsibility for the economic crisis.

Yet the country's biggest banks are using "their" money and laws (that they often wrote) to block municipalities' use of eminent domain. "Their" money includes the massive bailouts Washington provided to them since 2007. Big bank directors and major shareholders - a tiny minority - fund the politicians, parties and think-tanks that oppose municipalities' use of eminent domain. In these ways, capitalism systematically undermines democratic decision-making about economic affairs. ........................(more)

The complete piece is at: http://truth-out.org/news/item/20550-capitalism-and-democracy-year-end-lessons

[daleanime]

1. bookmarked

[yurbud]

2. this guy is must read