How Rich is Too Rich For Democracy?

How Rich is Too Rich For Democracy?

by Thom Hartmann&nbsp;<div><br /></div><div>At what point does great wealth held in a few hands actually harm democracy, threatening to turn a democratic republic into an oligarchy?

It's a debate we haven't had freely and openly in this nation for nearly a century, and by voting to end the Estate Tax, House Republicans tried to ensure that it wouldn't be had again in this generation.

But it's a debate that's vital to the survival of democracy in America.

In a letter to Joseph Milligan on April 6, 1816, Thomas Jefferson explicitly suggested that if individuals became so rich that their wealth could influence or challenge government, then their wealth should be decreased upon their death. He wrote, "If the overgrown wealth of an individual be deemed dangerous to the State, the best corrective is the law of equal inheritance to all in equal degree..."

In this, he was making the same argument that the Framers of Pennsylvania tried to make when writing their constitution in 1776. As Kevin Phillips notes in his masterpiece book "Wealth and Democracy: A Political History of the American Rich," a Sixteenth Article to the Pennsylvania Bill of Rights (that was only "narrowly defeated") declared: "an enormous proportion of property vested in a few individuals is dangerous to the rights, and destructive of the common happiness of mankind, and, therefore, every free state hath a right by its laws to discourage the possession of such property."

Unfortunately, many Americans believe our nation was founded exclusively of, by, and for "rich white men," and that the Constitution had, as its primary purpose, the protection of the super-rich. They would have us believe that the Constitution's signers didn't really mean all that flowery talk about liberal democracy in a republican form of government. read more....

The Boston Tea Party - America’s First Anti-Globalization Protest

The Boston Tea Party - America’s First Anti-Globalization Protest

Conventional wisdom has it that the 1773 Tea Act - a tax law passed in London that led to the Boston Tea Party - was simply an increase in the taxes on tea paid by American colonists. In reality, however, the Tea Act gave the world’s largest transnational corporation - The East India Company - full and unlimited access to the American tea trade, and exempted the Company from having to pay taxes to Britain on tea exported to the American colonies. It even gave the Company a tax refund on millions of pounds of tea they were unable to sell and holding in inventory.

The primary purpose of the Tea Act was to increase the profitability of the East India Company to its stockholders (which included the King and the wealthy elite that kept him secure in power), and to help the Company drive its colonial small-business competitors out of business. Because the Company no longer had to pay high taxes to England and held a monopoly on the tea it sold in the American colonies, it was able to lower its tea prices to undercut the prices of the local importers and the mom-and-pop tea merchants and tea houses in every town in America.

This infuriated the independence-minded American colonists, who were wholly unappreciative of their colonies being used as a profit center for the world’s largest multinational corporation, The East India Company. They resented their small businesses still having to pay the higher, pre-Tea Act taxes without having any say or vote in the matter. (Thus, the cry of "no taxation without representation!") Even in the official British version of the history, the 1773 Tea Act was a "legislative maneuver by the British ministry of Lord North to make English tea marketable in America" with a goal of helping the East India Company quickly "sell 17 million pounds of tea stored in England...."

Read the entire article here: http://www.thomhartmann.com/teaparty.shtml

The Fair Tax Act of 2005

Recently, my sister sent me an e-mail asking what I thought about the "Fair Tax Act of 2005" (S. 25, H.R. 25). I put an hour into reading about it, formulating a response, and then sending her my e-mail. Then I thought "Why share it with only her?"

Here is the e-mail that I sent to her:

I did some searching on the Internet and found a few problems with the Fair Tax proposal. Here is what I found (mostly cut-and-paste from various websites):

First, it exempts all business transactions so the burden of ALL taxation in the country will fall on the American people.

Second, it shifts the burden of taxation towards the poor and middle class. A sales-tax-only system burdens the poor much more than the rich. The poor spend a greater percentage of their income than the rich - if basic necessities cost $15,000 a year, someone making $20,000 a year spends a lot more of their total income on them than someone making $250,000 a year.

As far as non-optional expenditures (food, shelter, heat, cable TV... you know, necessities) the poor spend everything they get. This means that by default, the poor become the highest tax bracket. The richer you are, the more you can invest, the less you're taxed on.

Third, the Fair Tax proposal claims to be "revenue neutral", meaning the total amount of taxes collected will be the same as what is collected now - which lends credibility to the argument that it is just another tax-shift from the rich to the poor and middle class.

Fourth, everything you buy will instantly become 23% more expensive. It'll seem really nice when you get that first untaxed paycheck, until you realize that you weren't in the 23% bracket before, but now you are and now you have even less extra money in your budget. Note: The current tax rate for people earning over $68,500 is 25%. The tax rate for someone making less than $68,500 is only 15%. If you make less than $68,500 per year, this new system will bring you a significant tax increase (once again, shifting the tax burden from the upper classes to the lower classes).

Bottom line: If you make more than $68,500 per year, you should support Fair Tax. If you make less, you should oppose it.