Republicans + Woke

“Use it up, wear it out, make do or do without.” Millions of Americans were forced to live by these words during the 1930s. The Great Depression swept across the country like an unforgiving force. Millions became jobless while many others went hungry. Kitchen soups and bread lines became common sights in every major city; the nation was on the brink of collapse.

For those who witnessed the country’s incredible growth during the 1920s, the stock market crash of 1929 was nothing more than an inconceivable nightmare. While the U.S. had experienced market downturns in the past, nobody expected the widespread devastation that the Great Depression would cause. 

In their time of need, Americans of every stripe understood the necessity for renewed leadership. Something had gone horribly wrong and it was now the government’s responsibility to ensure that the people of this country aren’t forced to endure such hardships ever again. That unified desire for change resulted in the rise of one of America’s most influential political figures: Franklin D. Roosevelt.

A Democrat, FDR is the only president in American history to have served four consecutive terms in office (he died in 1945 while serving his fourth term). Considered by historians one of the three greatest U.S. presidents (the other two being George Washington and Abe Lincoln), FDR redefined the role of the federal government in ways that, I would argue, remain unmatched.

Aware of the tremendous pain the Great Depression was inflicting on American families, especially on older Americans, the Roosevelt administration set off to implement one of the nation’s most ambitious policy agendas in history: the New Deal. Forgotten by many young Americans today, the New Deal proved very successful at curbing the very negative effects of the crisis. It included numerous programs intended to support rural America, the unemployed, the young, and the elderly. The Public Works Administration or the Works Progress Administration, for example, led to the creation of countless job opportunities and helped lift thousands of Americans out of poverty. But perhaps FDR’s New Deal is better remembered for giving rise to one of America’s most popular government programs: Social Security.

The Social Security Act was signed into law in 1935, creating the Old-Age, Survivors, and Disability Insurance (OASDI) program. Colloquially known as Social Security, the OASDI program became the first government program to target the many challenges faced by American retirees, although it also provided benefits for widowed and disabled citizens. Prior to the creation of Social Security, old Americans had to rely on their savings or on family support to make ends meet after retirement. But the Great Depression had severely severed those two lifelines, leaving them without a dependable source of income. Today, millions of retired Americans continue to view their Social Security benefits as an important source of economic security in their old age.

FDR’s unwavering commitment to helping the poor and those in need resonated with his party, and for over forty years the Democratic Party became a resolute advocate for justice and for equality. It wasn’t easy, but progress towards a stronger, less unequal society was made. In 1965, as part of his war on poverty, Lyndon B. Johnson picked up where FDR left off and launched Medicare and Medicaid, thus creating the country’s first national health insurance programs. Today these programs provide health and financial security to nearly 100 million Americans.

At this point you may be wondering why I decided to revisit a chapter of American history most of you are already well aware of. Here is my answer: Our public discourse seems to have fallen victim of increasingly nasty and ill-informed attacks, so I thought it would be quite educational to look back and reflect on this country’s not-so-distant past, a past when so-called “socialist” policies were all the rage. Because let’s face it, folks, this country is drowning in socialism. Every single policy I laid out in this post is an example of a socialist policy. And there is more, of course. K-12 and even your nearest fire department are also examples of socialism in America.

For over forty years, the Democratic Party was a champion of such policies. They cared for the poor. They believed in a more equal society. But not anymore. Today, the Democratic Party is not all that different from the Republican Party. Why do you think the Democratic Party has been running on identity / woke politics for the past twenty years? Because they don’t have anything else to offer. Their economic agenda is the GOP’s agenda.

As I stated in my previous post, the Democratic Party seems to have reached the conclusion that Joe Biden is the best candidate to run against Donald Trump in November. The moment the party understood that Bernie had the resources and voter enthusiasm to secure the nomination, they put together a campaign strategy that will make political history. In a matter of days, endorsements of Biden and opinion pieces trashing Bernie Sanders have piled up like dominoes, seriously wounding the self-described democratic socialist and very likely putting the final nail in the coffin for his historic campaign.

Bernie Sanders is often demonized for not being a true Democrat, and it is no secret that the Democratic establishment has come down hard on Sanders because they believe he poses a serious threat to the party’s identity and future. But nothing could be further from the truth. Sanders is no threat to the party. In fact, Sanders and his movement are the embodiment of what the Democratic Party represented for the better part of half a century. A party that did not shy away from challenging the status quo. A party that understood that widespread poverty and inequality were the true enemies of the nation’s overall well-being and stability.

Whether or not Bernie Sanders wins the nomination, his message is here to stay. Now it is up to those who believe in that message to bring decency, humanity, ambition, and hope back into the Democratic Party, and to carry on FDR’s legacy.

Welfare for the Wealthy?

I’m assuming that a lot of you have already been sucked into countless arguments driven by the daily happenings of what has become the most heated political season in recent memory, so I fully understand how hard it would be to have you turn your attention to actual problems. Unfortunately, that’s exactly what I need you to do as you get ready to read this post. Today I want to share with you a piece of reality very often overlooked, and I don’t think I exaggerate when I think of this as one of the greatest public policy travesties in American history. My hope is that by the time you are done reading, you will begin to reconsider your views on whatever you think the government is doing with your tax dollars, because whatever you believe now might actually be somewhat far from the truth.

Regardless of where you stand in the political spectrum, you won’t be able to deny that over the years the United States has implemented numerous policies that could be referred to as ‘socialist’ policies. Socialism occurs when the state collects money from its citizens in the form of taxes and spends that money through various social programs in an effort to guarantee the well-being of its people. These programs are collectively known as the “welfare state”. Social Security, Medicare, Medicaid, or TANF (Temporary Assistance to Needy Families) are the four most recognizable examples of such policies. So yes, there is socialism in America. Tons of it, in fact. But this shouldn’t come as a surprise to you. There’s been welfare in this country since President Roosevelt signed the Social Security Act into law in 1935.

These programs are designed to help improve the quality of life of those who find themselves in a disadvantaged position. For example, through the Social Security Administration, Americans 65 or older and disabled individuals can receive monthly benefits in the form of pensions or disability benefits. In the healthcare arena, Medicare provides health insurance to the elderly and also to younger people with disabilities, while Medicaid is designed to provide insurance to low-income families.

And these are not the only programs in place. There are also subsidies to aid the needs of hungry families (i.e. food stamps) or even of those who lost their jobs (i.e. unemployment benefits).

As you can see, the United States, the world’s foremost capitalist economy, has put in place major social programs to combat poverty and ensure that millions of Americans have access to a very basic but decent way of life. But I won’t lie to you, as much as these programs have done to improve the quality of life of many Americans, most adults don’t qualify to receive a lot of these benefits for matters of age and income.

If you take a look at the chart below, you will notice that the cost of the ‘welfare state’ in America constituted nearly 60% of the $3.8 trillion federal budget for 2015:

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By now it should’ve become clear to you all that, in many ways, the United States is a socialist nation. But that’s no travesty! Most industrialized nations have implemented similar programs, and more ambitious ones too (universal healthcare, anyone?). The travesty unfolds not when the government collects taxes to finance its much-needed social agenda, but rather when it intentionally doesn’t do so for the benefit of a small few.

I assume most of you haven’t heard of the hidden welfare state before. This is a term coined by political science professor Christopher Howard, and it refers to the revenue the federal government forgoes in the form of tax expenditures for the benefit of certain segments of the population. This occurs when the government refrains from taxing certain individuals who have proven a determination to use their taxable income for purposes deemed ‘socially valuable’ by the government. This might look good on paper, but the truth is people who benefit from these tax breaks are mostly wealthy individuals (shocker!).

The most common tax expenditure is the home mortgage interest deduction. This deduction allows people who own a home to pay less on their taxable income. The reduced amount is determined by the current interest being paid on their loan. I’ll give you an example. If you are a homeowner paying a 3% interest on your loan, and you are required by the IRS to pay 15% in income taxes, the home mortgage interest deduction will bring down your debt with the IRS to 12%. That’s a pretty sweet deal, huh?

According to a study by The Wharton School at the University of Pennsylvania, mortgage interest deductions for households with incomes between $40,000 and $75,000 average just $523, while households with incomes above $250,000 enjoy an average write-off of $5,459, or more than 10 times as much. To claim the deduction though, you must itemize your deductions on very specific IRS forms. If you choose to do so, you can also deduct the interest paid on a second home. The wealthy do both, but most of the middle class does neither.

The home mortgage interest deduction is nothing more than a tax break for the wealthy. But that’s not all. The tax code also includes many other tax expenditures associated with charitable contributions, retirement savings, and even higher education. Again, a series of activities low-income Americans often cannot engage in.

I consider this to be an extremely serious topic, and that’s why I want to share with you the whole truth about the hidden welfare state. These deductions often benefit the wealthy, true. But there are some tax breaks available for low- and middle-income families as well, and the earned income tax credit or EITC is perhaps the most prominent. The EITC is designed to provide tax credits to working individuals with very few means to get by, particularly those with children. The EITC can ease the tax burden of a lot of Americans, and it is specially helpful in combating poverty in this country.

So yes, there are some exceptions to the rule, but the cost of the EITC ($66.7 billion in 2014) is nothing compared to the total cost of tax expenditures, which amounted to a total of almost $1.2 trillion in 2014.

And let me be clear, tax expenditures, no matter what type, always entail a cost. From a government spending perspective, not wanting to collect certain taxes is no different from directly spending public money. If someone owes you $50 but you choose to forgo their debt, you’re still losing money, right? Similarly, when the government issues tax breaks, it chooses to give up tax revenue for a specific purpose – so both spending and tax breaks mean less money in the treasury.

What I’m trying to convey here today is that the United States is spending trillions of dollars on tax expenditures that, for the most part, benefit the wealthiest among us. Can you imagine what this country could do with $1.2 trillion every year? Bernie Sanders has stated countless times that he wants people in America to have access to universal healthcare and a public education, and often the reaction to his proposal is that America is too big a country, that the government cannot afford it. To those of you who want to see these policies implemented and who often bring up the cost of defense as proof that this country does have the means to make this utopia a reality, be sure to comment on the $1.2 trillion a year the United States government spends on tax breaks next time someone questions the viability of these seemingly radical proposals.

As I stated at the beginning, the US continues to enact socialist policies, and has done so under every president since the 1930s, therefore no one should be outraged by Sanders’ ‘radical’ plans.

The hidden welfare state serves as proof that the federal government has the means to considerably improve the lives of its citizens, and that in the end it all comes down to what our priorities ought to be. Do we spend more on defense and tax breaks for the wealthy, or do we make an effort to ensure that needy Americans have access to free healthcare and tuition-free public colleges?

The choice is yours.