The Old Order Changeth ....?

Our Wall Street contributors coughed up $365 million in August, trumping Trump's measly $210 million. A frightened President is promising to use his own money down the stretch. Thank you and keep this under your masks. We mean you no harm. Don't worry about Elizabeth Warren. After we pull in the votes of her supporters you can forget about the financial sector reforms she is pushing.

Preparing a Plinth For a New Era
George Washington Canceled

Source: oregonlive.com

That's what Biden's team is telling supporters in the financial community. Taxes, they concede, will go up. The corporate tax rate will go from 21% to 28%, the top individual rate from 37% to 39.6%, capital gains will be taxed as ordinary income. The Committee for a Responsible Federal Budget (CRFB), a non-profit, non-partisan organization, estimates that taxes on the top 1% of earners will rise by 13%-18% of after-tax income, while indirectly increasing taxes for most other groups by only 0.2%-0.6%. Allowing for the drag on growth, new taxes could raise $2.7-$3.1 trillion over ten years reckons the CRFB, "a large tax increase by historical standards", according to the Tax Foundation, an independent think tank. But it won't make a dent on the national debt: Biden plans to increase spending by about $11 trillion according to a detailed analysis by the Manhattan Institute for Policy Research, a conservative think tank. Others believe the figure is closer to $7-$8 trillion. The CFRB will be heard from later this month.

This tax-and-spend program marks both a shift to a more progressive tax system and a major expansion of government. But nothing wildly outside the bounds of what should be expected of an end to the era of Trump and the beginning of an era of Biden. The increase in the top personal tax rate returns it to where it was when Biden was working for Barack Obama, and Biden's proposed corporate rate is half-way between Obama's 35% and Trump's 21%. Federal revenues under Biden would rise from 17.8% of GDP under current law to about 18.9%, when Bill Clinton, never accused of being a wild-eyed radical, was President.

Biden would also eliminate tax advantages enjoyed by hedge fund operators and, er, property developers, advantages that drain faith in the fairness of the system, exacerbate inequality, and are best consigned to the dustbin of history. And, to make America great again, he plans a 10% surtax on US sales from US companies' foreign affiliates, and a 10% tax credit for businesses that bring jobs home. Lobbyists! On your marks, get set, go!

"Elections have consequences," Biden's former boss famously told Republicans. But, crucially, he added, "Don't break what our predecessors spent over two centuries building. That's not being faithful to what this country's about." Such breakage would be the inevitable result of a Biden election. Here's why.

This is not your grandfather's Democratic Party, led by Franklin Roosevelt, intent on reviving and reforming the economy, but preserving its basic institutions. Or by Bill Clinton, constantly searching for some middle ground on which to stand and fight. It is the party of such as Alexandria Ocasio-Cortez, the charismatic self-styled  democratic socialist who sees Biden as a way station en route to Bernie Sanders' America. She has organized primary battles that unseated long-serving centrist Democrats, giving her faction, known as "The Squad" (AOC, Ilhan Omar, Ayanna Pressley, Rashida Talib) the ability to threaten to "primary" Democratic congressmen if they do not go with the flow and move left.

A Biden win would also likely mean Democratic control of the senate. Every new senate makes its own rules, and Democrats plan to begin by eliminating the filibuster that requires sixty votes to pass many bills: 50 plus Kamala Harris to break a tie would do the job.

That would permit a Democratic congress to grant statehood to Puerto Rico and the District of Columbia, almost certainly assuring the Democrats four more senate seats. It would permit the Democrats to act on their unhappiness with the Supreme Court, unalloyed by Chief Justice Roberts' recent votes with the liberal jurists, and increase the number of justices from the nine established in 1869 to perhaps fifteen, with a permanent liberal majority. Biden says he does not favour what is called "packing" the Court, but his Left believes that a few court defeats for his proposed legislation will persuade him to abandon that opposition.

So attention must be paid to the claim that this is the most important election in eons. It will decide whether there is to be a radical change in the institutions of government devised by the Founding Fathers and inscribed in the Constitution, with a system of checks and balances its cornerstone. The President with his appointment and veto powers checking the courts and congress; the congress with its control of funding and its power to impeach checking the President and using its confirmation power to control who sits on the courts; the Court checking congress and the President - all gone, replaced by rule of the majority in power.

That would change how taxes are levied, how the government divides its resources between social spending and national defence, how economic power is distributed between the public and private sectors, how the health care system is structured and funded, how clashing cultural issues are resolved, who gets to enter and who to stay in the US. For some this is a long-overdue cancelling of outdated institutions, for others a regrettable abandonment of institutions that have served, and can in the future continue to serve us well.

Unfortunately, this is not the choice being put to the voters. The Biden team, fearful of the electoral consequences of voter recognition of the eventual results   of a Biden election followed by a takeover of the party by its more energetic, more ideological Left, prefers to cast this as a personality contest with the seemingly nice Joe Biden seeking to replace the nasty, self-centered, Donald Trump. They should be careful what they wish for.

That sort of issue was on the table when do-gooder Herbert Hoover, who saved Europe from starvation after WWI, faced slippery Franklin Roosevelt in 1932, and lost. When nice, smiley Happy Warrior Hubert Humphrey took on  not-so-nice, unattractive and snarly Richard Nixon, he, too, lost. In both cases, nice guys finished last, as legend has it Brooklyn Dodger manager Leo Durocher predicted nice guys always would.

The fact is that voters have a choice between bad and worse, with the labels to be assigned as their preferences dictate. That will depend in many cases on how they balance their distaste of Trump against their support for many of his policies, and their preference for Biden's persona against their worries about whether he has the wit and vigor to hold the party to the moderate left-of-center. It will depend in part on whether voters prefer a man who has spent his entire life redistributing the wealth created by others, or one who has created billions in wealth, clawing as much of it to himself as he could but, led by an invisible hand to create incomes for others although that was no part of his intention.

Meanwhile, rumors abound that members of the Biden team have formed subcommittee to determine which woke heroes will be chosen to help reduce the impending over-supply of empty plinths.