Paul Krugman's Article, "Disdain for Workers" - My Opinion


In a recent article by Krugman (an opinion published by the NY Times on 09.20.2012), the title was "Disdain for Workers". (Click here for the article. ).

Krugman is an apologist for the progressive side of the political spectrum. As such, his opinions always run counter to the conservative side - this is to be expected. Opinions are what they are, opinions. They are meant to convey one person's "feelings" on a given subject. Truth or falsehood is not necessarily relavent to an opinion - although such would be nice; especially truth void of misrepresentation.

His basic premise in the article was to state/imply that the Republican side, indeed, has at its core a "disdain for workers". That is, Republicans "only" are interested in the "bosses". This is so contrary to fact as to be laughable. The advantage Krugman and others like him have is that the vast majority of people will NOT research the opinions to determine fact from "message".

As an example, Krugman starts off attacking Romney re: Romney's "47%" statement, especially the phrase "..my job is not to worry about those people". Here is a transcript of Romney's statement:

Romney:

"These are people who pay no income tax; 47 percent of Americans pay no income tax. So our message of low taxes doesn’t connect. He’ll be out there talking about tax cuts for the rich. I mean, that’s what they sell every four years. And so my job is not to worry about those people."

First, Romney was incorrect - 49.2% pay no income tax, not 47%. In any event, the following should be considered:

Romney was giving a talk to REPUBLICAN donors - not the general public. As such, those in attendance are assumed to be fully cognizant of conservative principles and all that goes with conservatism. The statements he made were captured via a "hidden camera" and released to the public at large. When making statements to "your own" one need not provide all the clarifications and explanations that would be necessary for a "general audience".

Perhaphs an analogy will help here:

Let's say I'm giving a talk to a group of software development professionals. Further, I offer the adage: "If you can steal it, don't build it!". Now, that adage gets reported to the general population as "He is advocating theft."

Since I was speaking to "my own", as it were, I did not need to offer the caviats and explanations such as "only if the software was in the public domain", "only if it did not violate a copyright law", or even use the "real" term 'Software Reuse' (the noun not the verb), etc. These are software professionals; they "know" that what the adage represents is: "If you are trying to solve a software problem and you know something that offers the solution, it's quicker and cheaper to copy the software rather than design, build, integrate and test something new - assuming it's legal to do so." But the public at large, due to the reporting, is left with the message that I advocate theft.

Romney, by his own admission, indicated that his choice of words (re: the "47%") wasn't the best. But again, his words were NOT meant for public consumption and without clarification leaves one with the ability to distort his message.

That being said, Romney's statement re: "And so my job is not to worry about those people." was NOT meant to imply that he doesn't CARE about people who, currently, don't pay income tax. He was addressing the fact that many such persons most likely would not vote for him in any case; so, why spend huge resourses trying to win them over? He used not the best example, politically, to only point this out. The media has protrayed the Republican side as wanting to raise taxes on the "poor", i.e., "workers", and lessen taxes on the "rich" - which is not true.

Any level of research would easily dispell this notion.

Consider: the one person the conservative side holds up as "The Best" is Ronald Reagan. Why? He lowered taxes across the board resulting in huge jobs growth. Why did this happen? Lowering taxes, especially on employers, allowed for greater investment, thus greater hiring. More "workers" produce greater tax revenue, greater buying power for those same workers, and enable those workers to save more thus ensuring their financial futures. Everybody wins. It's a fact - do the research on the results of the "Reagan Years".

Back to the "47%" for a moment:

On a talk radio show the other day a woman called in to state that she and her family were in the "47%". They made $80k per year; but, due to having 6 kids and huge mortgage her deductions allowed the family to be refunded the entire amount thay had "contributed" via payroll taxes during the year. This family was "playing by the rules" and current tax law allows this. Romney was NOT addressing this type of situation nor was he talking about those who are retired. He was making the point ONLY that those who were sold on Obama most likely couldn't be dissuaded - poorly made, perhaps; but that was THE point.

But consider this as an aside: A single person making that same $80k per year who rents is paying a signicant income tax - again, playing by the rules. Is it "fair" - not legal but "fair" - that the single person is contributing significantly to offset the non-taxpayer? Both receive the same "benefits" from the government; but, one pays nothing and the other pays a lot. Current tax law supports this - but is it fair? Think about it.

Krugman went on the state:

"For the fact is that the modern Republican Party just doesn’t have much respect for people who work for other people, no matter how faithfully and well they do their jobs. All the party’s affection is reserved for “job creators,” a.k.a. employers and investors. Leading figures in the party find it hard even to pretend to have any regard for ordinary working families — who, it goes without saying, make up the vast majority of Americans."

And,

"What really needs cutting, the right believes, are taxes on corporate profits, capital gains, dividends, and very high salaries — that is, taxes that fall on investors and executives, not ordinary workers. This despite the fact that people who derive their income from investments, not wages — people like, say, Willard Mitt Romney — already pay remarkably little in taxes."

I've already discussed why a greater focus on employers actually creates jobs thus helping "ordinary workers". Therefore, the Republicans' approach is to make the employer burden less thus facilitating jobs growth. It's actually their very high regard for workers that leads to the "let's make it easier for employers" approach.

Krugman states that Romney "..already pay(s) remarkable little in taxes". Paying taxes has two components - actual dollar amount and tax rate. Romney's latest tax return indicates that he paid $2M in 2011 - along with a $4M charity contribution (Note: he claimed a tax deduction for only $2.25m of this, pushing his effective tax rate higher.). This is NOT a small amount to pay. Romney's tax "rate" might appear lower than yours or mine but this is due to a large portion of his income is derived from capital gains - a significantly lower rate than "earned income" - also in accordance with tax law. So, on face value Krugman's "pay(s) remarkable little in taxes" is false and purposefully misleading - Romney's tax rate is lower but the dollar amount is significant.

An example of this "capital gains" not being treated fairly in reporting is the case of Warren Buffett. A while back Buffett made the statement that he paid less in taxes (actually what he meant was tax rate) than his secretary. This was true as almost all of his income is from capital gains - his secretary's income was "ordinary income". Before we feel too sorry for his secretary, she makes upward of $400k per year. Not too very bad, I'd say.

So, my recomendation would be - whichever political side you may be on - do proper research before just "believing what you read" - or hear or see. To quote TV's Gregory House, "Everybody lies!".