Guest Post: What Public Employee Leaders Could Be Saying (But Aren't)

Tyler Durden's picture

Submitted by Charles Hugh Smith from Of Two Minds

What Public Employee Leaders Could Be Saying (But Aren't)

Public employees and their leaders could publicly recognize the structural and demographic changes in the U.S. economy, and vow to tax the top 1% instead of supporting terribly regressive junk fees and sales tax increases on the working poor and the middle class tax donkeys who pay most of the taxes. The fact that they refuse to acknowledge these realities and refuse to take on the Financial Elites speaks volumes.

Here's what representatives of public-sector unions and public employees could be saying, instead of what they are saying:

There are over 20 million Federal, state and local government employees, and about 106 million private sector workers. We work for you, and for the good of our communities and of the nation. That is a big responsibility.

Back in the stock market bubble of 1995 to 1999, our wages, pensions and benefits were "sweetened," sometimes administratively and sometimes with voter approval. In the years since, what looked at the time like it would be paid by stock market gains rather than additional taxes has been revealed as wishful thinking.

We recognize that the U.S. economy has changed structurally, and it cannot return to 1999. We also recognize that the demographics of the nation have irrevocably changed since 1999, and thus it is wrong to burden future workers with pension and benefit costs which only made sense in an era of stock prices rising 10% or more annually.

In response to the shortfall between what we were granted in 1995-1999 and what the "new normal" recessionary economy can support, state and local governments have aggressively raised the most terribly regressive taxes: junk fees--parking tickets, vehicle license fees, and so on--and sales taxes.

These taxes are paid by everyone, rich and poor alike, and so they are deeply regressive.

Most of the Federal and state income taxes are paid by upper-middle class workers and small business, including sole proprietors and independent contractors. Almost 40% of all workers--those with lower incomes--pay no income tax at all. The top 1%, meanwhile, pay on average about 17% of their income in total taxes--less than half the rate paid by upper-middle class wage earners.

We understand that roughly two-thirds of the nation's households are measurably poorer in income and assets than they were a few short years ago. We understand that gains in productivity have not flowed to the incomes of most private-sector workers, but have instead flowed to the top via corporate profits and bonuses to the top slice of private-sector employees.

We also understand that the American workforce is aging, and that demographics are dictating that we as a nation need to work longer if our retirement plans are to remain solvent.

In recognition of these realities, we in the public sector are voluntarily renouncing all the "sweeteners" which were awarded during the bubble years of 1995-1999, as they have been revealed as unaffordable. Our retirement and benefits will revert to the base year of 1995, before the bubble distorted the system and the economy, and be adjusted for inflation since then as measured by the Consumer Price Index (CPI).

In recognition of the nation's demographic realities, we are moving our retirement age up to those of the Social Security system: 62 for reduced benefits and 67 for full retirement benefits.

We understand that raising "stealth taxes" via junk fees and highly regressive sales taxes places great burdens on households which are already straining to make ends meet.

As a result, we are putting our political weight behind an alternative way to bolster state and local government finances: "make the top 1% pay the same tax rate as the rest of us." If the top 1% paid the same 40% rate as higher-income workers pay, then that would only be equitable.

We will also fight to reverse the regressive increases in sales taxes and junk fees which have been imposed on those least able to afford more taxes.

The super-wealthy--those households with incomes above $1 million annually, and with financial assets above $5 million-- are the most politically powerful group in the nation, and so getting them to pay the same tax rates as we pay will be a difficult battle. They own or control the political class, the tax attorneys, the tax-avoidance scams and the offshore accounts.

But taking more money from households who are struggling to get by with highly regressive taxes and junk fees is simply wrong, just as it is unjust that the super-wealthy avoid paying the same tax rates that ordinary workers pay.

We ask for your support in this campaign to reverse regressive taxes and make the top 1% pay the same tax rate as the rest of us.

What is not being said is this: public employees are dependent on, and benefit from, the State's monopoly to collect taxes and fees via coercion. Private-sector workers cannot rely on a coercive monopoly to extract their wages from others. This is the key difference between the public and private sectors.

To the degree that junk fees and taxes have been raised administratively by a political class that is beholden to the super-wealthy Financial Elites and cartel-State fiefdoms, then the imposition of regressive junk fees and other taxes is taxation without representation, i.e. tyranny.

Public employees benefit from this tyranny, private-sector workers do not. That is a key difference between the two.

Given that the political class only represents cartel-State fiefdoms and Financial Elites, then the only taxes which aren't a form of tyranny are those approved by voters.

While there is always a danger of "the tyranny of the majority" in the ballot box, it is certainly less tyrannical than administratively imposing regressive taxes and exorbitant junk fees on the working poor and the middle class tax donkeys.

The consent of the governed (and thus of the taxed) can be revoked at any time.

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NOTW777's picture

dont hold your breath; remember the union folks are doing it for the "kids"

NOTW777's picture

oh yes and it also helps that they are paid for by soros and dnc

a quarter a junk - LOL

Breaker's picture

I get a kick out of near riots by the government against the government.

Monday1929's picture

No union concessions until bankers are indicted. THEN one can be reasonable.

Panafrican Funktron Robot's picture

I think if we just did a transaction tax (to include financial transactions, sales, etc.) with flat rate refund distributions if net revenues exceed net expenses, we'd probably be in a lot better shape.

NOTW777's picture

MSM and people like rev jackson comparing union protesters to those in MENA getting blown up and shot at - US MSM is the biggest liar/deceiver of all time

Rodent Freikorps's picture

Go ahead and tax the rich. They control the prices. They'll just take it right back with a little bit of "fuck you" extra.

cartonero's picture

So if the rich are all-powerful, then we're just fucked, no?

MrBoompi's picture

Well, then I vote for the cheapest and most effective capitalistic system of all, 0% taxes on incomes over $250k, 0% corporate taxes, 0% capital gains tax, and 0% estate tax.

That'll straighten things right up.

Dr. Acula's picture

>Go ahead and tax the rich.

Yeah, committing more robbery is a good thing, as long as someone else is the victim.


Rodent Freikorps's picture

Taxing the rich is almost as much a flaming lie as taxing business.

But, if the moron voter goes along with it, screw them.

Hacksaw's picture

It use to be a lie in the age of inflation when business had pricing power and the rich created jobs in the U.S. Now it isn't a lie because this is the age of deflation when business has no pricing power and the rich are moving jobs for the U.S. to China.

ElvisDog's picture

Taxing the rich never brings in the expected revenue because (1) the rich will leave to a state or country that doesn't tax them so much (2) the rich will hide their money from taxation (3) if you take away the monetary incentive to work hard the already rich will check out and play golf all day long.

Lord Koos's picture

Closing these kinds of loopholes for the rich would be easy to do if there was the policital will to make the changes.  Their could be penalties for American corporations who only make investments outside the USA, and incentives to invest at home, for example.  As far as the monetary incentive, I don't see where that was taken away in times when taxes were higher.  In the 50s 60s and 70s taxes were higher but we did not see the wealthy becoming lazy.  

steve2241's picture

"3) if you take away the monetary incentive to work hard the already rich will check out and play golf all day long."
The dollar has been consistently devalued for more than 40 years. Monetary incentive to work hard? Add in income taxation and the tax to the human body from (hard) physical labor and you've got one witch's brew that anyone with half a brain can see. It continually confounds me how people are able to get out of bed every day and "go to work"! Seriously. The alternative/antidote is revolution.

Hacksaw's picture

Is it theft when you steal stolen property from a thief?

TeamAmerica's picture

You've swallowed the pill and washed it down with the kool-aid.   

You believe exactly what the rich want you to believe...that you are powerless.

Dr. Acula's picture

>The consent of the governed (and thus of the taxed) can be revoked at any time.

Not when they invariably vote for socialists.


Rodent Freikorps's picture

All nations die, in pretty much the same way.

treemagnet's picture

Please don't get me started on public unions....see if you can guess what I'm thinking now......

Seasmoke's picture

you must be thinking, what were you thinking when you got out of high school and thought it best to make it on your own terms

jus_lite_reading's picture

Here we go again!! Just ask the people in Greece about UNIONS!

treemagnet's picture

Who junked me?  Fess up losers - is that all it takes these days......

mynhair's picture

SSN getting interesting......

Cognitive Dissonance's picture

One must always remember the Golden rule when it comes to conditioning the public mind.

We are always allowed to complain about the system. Bitch about this, declare that unfair, protest about the special favors those over there are getting, whatever. But you are never ever allowed to seriously question the basic system. If you do, if you begin to question not how the pie is divided but the pie itself, if it should even exist in the first place, then are are immediately labeled a subversive or a socialist or commie or anarchists or whatever. And this comes not only from the MSM, government and all it's various talking heads, but from the very same people who are part of the system and might benefit from a re-examination of the entire systemic picture.

The captured mind will always fight to remain safely within the confines of the system that has captured and conditioned it.

Pants McPants's picture

Exactly right.  NEVER question the pie itself, that is a given.

All the more reason to expand the scope of debate at every possible opportunity.

Seasmoke's picture

way too much baking soda in that pie

Pseudo Anonym's picture

if you begin to question not how the pie is divided but the pie itself

I would want to know who baked the pie. But will not ask that question, as I do not wish to be labeled a subversive or a socialist or commie or anarchists or whatever..

Pseudo Anonym's picture

whose piece of shit is this pie? That's what I want to know. oops, now, for asking that question, I will be

immediately labeled a subversive or a socialist or commie or anarchists or whatever

my bad.

TradingJoe's picture

You will only be able to tax the rich when you can end corruption in Gov!

Until up or I did :))!

And the ones (taxes) coming (soon) to a community near you once this gravy train stops,

well those ones will break your back, arms, legs, hands and ultimately your neck!

Since nobody is willing to really take it to the streets this will go on until it can't

no more, or there is nothing to steal, tax or "kill"!

Can and most likely will take a few more years of lying, cheating and stealing

but in the END there will be NO ONE LEFT STANDING!

How do you prepare, well accumulate as much as you can,

you will need every bit of it, can't fight them, it's not really necessary to "join" them,

just have enough to defy them!

Happy Days's picture

Recommended solution: all those in the real world (non-gooferment) stop going to work. Continue working and nothing will change. The unionized do it....why doesn't the rest do the same? It is rather obvious how well this works.

We have.....

anarchitect's picture

Lots of sense in here.  However,

"The top 1%, meanwhile, pay on average about 17% of their income in total taxes..."

"If the top 1% paid the same 40% rate as higher-income workers pay, then that would only be equitable."

Equitable but grossly extortionate. Instead, the flat tax rate should be 17%, with spending cuts to balance the budget at that level.

bob_dabolina's picture

Public employee union leads only care about....public employee union leaders.

What is so hard to understand about this concept?

BTW I am in favor of a 6 month tax holiday for all income brackets. That should curb this prodigal government from anymore wasteful spending on bullshit.

11b40's picture

Sorry, Bob.  Only would be effective if you could also turn off the printing press & shut down the bond market.

sabra1's picture
JP Morgue is paying 80% premiums not to take delivery in the crucial month of March. There are only 40 million ounces available for delivery and little under $1.5 billion would expose this greatest of frauds.
Rodent Freikorps's picture

And Ben has their back, and they will fuck you like an $8 Thai, three-holer hooker.

RichardENixon's picture

Last time I went to one of those she charged me $10. I'm in the inflationist camp.

MachoMan's picture

When your entire lifestyle, career, and support system has been built upon a lie of credit, manipulated news, and taxes, and you are faced with the destruction of all of this, then you do anything you possibly can to prolong the status quo.  This basic presumption explains not only public employee unions, but also banksters on down the line.  Ultimately, they are all welfare queens and their race to the moon in a homemade rocket ship has fallen short of oxygen and fuel.

redpill's picture

As long as the income tax exists, it will be abused by politicians and the ultra-wealthy alike.

The 16th amendment should be repealed, and we should have the FairTax or similar consumption tax instead.

uno's picture

interesting stat, Bloomberg TV referenced that the entire space shuttle program cost was less than TARP when the last shuttle launched; here are the numbers I found

TARP - $700 billion

Space Shuttle cost for entire life of program is estimated to be $174 billion

I understand both are goverment programs, the problem is defining the scale of Wall Street corruption

streetman's picture

Except that TARP was a loan program, and only $245 billion went to banks.  The rest went mostly to FNMA, Freddie Mac and GM.  $564 billion in total went out and $237 billion (almost from the banks) has been returned with interest and dividends so far.  You should be paying more attention to the $1 trillion in "stimulus" money, if you want to talk corruption, have you seen any of that lately?

Panafrican Funktron Robot's picture

Annoys the fuck out of me when people try and rationalize TARP, in the face of things such as the AIG/Goldman bailout or the $1.2 trillion dollar MBS bailout. 

Then again, you're probably one of the fucking scum who aided and abetted these schemes.  Thanks for shitting on us in your three piece suit.  Never mind the sword hanging over your head.