Adam Smith and Ronald Reagan, Socialists

Joe Conason writes in Truthdig:

Now let’s address the ignorance of his rant. Progressive taxation is a tradition of Western economics that dates back considerably further than Marx and the Communist manifesto, with all due respect to the wingnuts who seem to be writing McCain’s speeches. He admits that he has neglected his economic studies, so perhaps he isn’t aware that Adam Smith, revered philosopher of market capitalism, advocated tax fairness as far back as 1776, the fateful year when he published the first edition of “The Wealth of Nations.”

Although there was then no income tax, Smith’s principled judgment on the justice of higher taxes on those who could pay more, enunciated on several occasions, could not be clearer. He favored property taxes and luxury taxes because they would fall most heavily on the wealthy. He would have levied a sizable tax on all seven of the McCain homes plus an additional chop at all of Cindy McCain’s credit card binges.

In “Wealth of Nations,” Smith wrote: “The subjects of every state ought to contribute towards the support of the government, as nearly as possible, in proportion to their respective abilities; that is, in proportion to the revenue which they respectively enjoy under the protection of the state.”

Few legislators are more familiar than McCain, in his maverick incarnation, with the enormous fortunes raked in by oilmen, defense contractors, bond holders and the whole host of modern capitalists under the protection of the American state. The notion that those fortunes, often gotten in a parody of the free market, should be taxed at the same rate as the earnings of a plumber would strike Smith as monumentally unjust and an attack on the moral foundations of society.

And, he points out, casting

socialist aspersions on a tax refund to working families whose incomes are too low to pay income taxes is to paint a big pink stripe onto McCain’s supposed idol, Ronald Reagan. In 1986, Reagan signed legislation greatly increasing the earned income tax credit, a credit for low-income workers that reduces the impact of payroll taxes in order to boost take-home pay above poverty levels. When the credit is more than the amount of federal income taxes owed by an individual, that person receives a tax “refund.” Reagan praised the earned income tax credit as the best “anti-poverty” and “pro-family” legislation ever enacted by Congress.

In other words, there's no indication the John McCain has the faintest clue what "socialism" means. It's just a bad word he can throw at Obama in a desperate attempt to scare those people who are scared of him because he's black. (What? Why else does he call Obama's income tax rebate for the working poor "welfare"?) And let's never forget the fundamental dishonesty of saying those people "don't even pay taxes". Has McCain never heard of sales tax or property taxes or payroll taxes? Okay, maybe not the latter... but even the wealthy elite like the McCains who've never held a non-government job if they work at all still pay the other two.

And sales taxes are the worst, most punitive and regressive form of tax there is. My home state (not where I live now) has no income tax. So its sales tax is 7% which goes up to almost 10% in most jurisdictions with locas add-ons of between 1.5 and 2.75%, with the latter almost the rule. No matter who you are or how much money you make, you have to buy food and clothes and gas. And that 10% extra hits the guy making $13,624 (minimum wage full time) a helluva lot harder than the guy bringing in $250,000. So that minimum-wage worker isn't paying income tax, but "not even paying taxes"? Ha ha. So funny.

I had a student earlier this year, rather right-wing, who kept calling Hillary Clinton and Barack Obama - and Dennis Kucinich and John Edwards and Ted Kennedy - "fascists". Turns out he didn't really know what fascism was; he just wanted a label for the left... Problem is, while we got that he didn't like them, we also got that he didn't know what he was talking about. Obama may be closer to socialism than fascism, but McCain might want to reconsider sounding like a 19-year-old with more anger than knowledge. Not very presidential, that.