Given Mr. Biden's long political history as AOC pointed out in a recent statement she made,
given his long history of being a spokesperson for the corporate elite that based their corporations
in his home state of Delaware, given his votes on a whole host of issues,
foreign policy, in particular, one didn't expect much from Joseph Biden, a centrist Democrat, the
partner of the Clintons, Obama, and all the rest. So, let's be clear. He is doing better and more
than his history would have led us to expect. That brings me to an
important comparison that many have made. Is Mr. Biden another Franklin Delano Roosevelt?
Well, I want to answer that very directly but with an answer that may frustrate some of you.
The answer is yes and no. There are similarities and there are differences, big differences.
First, the similarities. When Franklin Roosevelt ran and won the presidency in 1931 and ‘32,
he was a centrist democrat rather like Joseph Biden, his race for the presidency that he won
was based on a proposal for a balanced budget. He didn't want the government even though we
were then three years into a severe depression, what turned out to be the greatest depression
in capitalism's history. Even then, he was for a balanced budget,
not having the government step in and try to repair what was clearly a badly broken capitalism.
But once he got into office and saw how bad it really was, he went further than
he had been. So, there's a similarity. Both Biden and Roosevelt were centrists
and both went further once they got in and took the full measure of how bad the crash
of capitalism was back in the 1930s and the one we are still in now. And just a footnote,
as a matter of historical record These are the two greatest crises of capitalism as a system,
both in the United States and globally: the 1930s and 2020-2021. These are historic times.
But that similarity has to be offset by the differences between what Mr.
Biden is proposing and what Roosevelt did. Nothing Mr. Biden is proposing has the scope, the size,
or the social impact of what Roosevelt did. Very briefly, let's see/ Roosevelt established, in
the depths of the depression, the social security system, at a time when the government had no money
and every American family was stressed beyond anything anyone had planned on,
the president announced that somehow, somewhere, he would get the money so that every
person reaching the age of 65 in the United States would qualify and receive from the government
a significant check every month for the rest of their lives. We had never had anything
like such a public pension program in the United States: an incredible breakthrough.
Number two: the federal unemployment compensation program. If you lose your job,
through no fault of your own, the government will give you a check every week for six months,
twelve months, eighteen months, it varies. We had never had that before in American history.
He passed the first minimum wage. And finally, and most importantly,
he initiated a public jobs program for the millions of Americans who were unemployed
in the 1930s. He hired 15 million jobs, gave those people income security, self-esteem,
a future, and not just for them of course, but for their families and the communities which they
sustained by being able to have a job and earn an income: staggeringly large programs. Mr. Biden
is not doing anything comparable to that or maybe I should say not yet. I'll come back to that.
Now let's turn to taxes. When it comes to taxes, I would argue that the similarities are smaller
and the differences even larger. How is Mr. Biden going to pay for the social
programs in the trillions of dollars that he has proposed around COVID,
around the American Families Plan, around the infrastructure updating, and so on?
Well, he's proposed to raise corporate tax rates from 21% of profit (That's what Mr. Trump
lowered it down to from the 35 it was when Trump became president.) back up to 28%. Please note,
Mr. Biden is proposing to take it only halfway back to where it was. And let me
recall for you that it was dropped at a time when corporate America needed it least because we'd had
40 years of redistributing wealth and income from the bottom and the middle to the top,
from individuals to business. That's a very modest proposal and the Republicans have already
indicated they will not support a 28% corporate profits tax, so the compromises are beginning.
Mr. Biden has suggested he will compromise, so the best guess is 24% or 25%.
So, notice then, it was dropped as of the year 2018 by Trump from 35% to 21%,
ending up with Mr. Biden’s 24% or 25%. That is modest
and way less than the kinds of tax rate increases that Roosevelt imposed on corporate America.
The same is true of personal income tax. Mr. Biden has proposed to raise the personal income tax
from roughly 37% to roughly 39 and a half percent. Okay, that's an increase, but it's modest. Let me,
in contrast, mention the proposal made by President Roosevelt in one of his last messages
to congress. In his state of the union message, he proposed a 100% tax on the richest Americans.
That's right. In the mid-1940s, the president proposed that every dollar over the top rate,
which in those days was $25,000 a year, (If you adjust for prices it would be roughly $400,000
a year.) every dollar you earn over that, said the president, would be taxed at 100%.
You wouldn't keep any of it. In effect, it's a maximum income that is being created by such
a tax. When it went to congress, the Republicans went ballistic, as they always do, yelling and
screaming. Eventually, a compromise was reached, which is typical. And what was the compromise?
94 cents of every dollar over $28,0000 that a rich person earned in the mid-‘40s, in this country,
the United States, 94 cents of that dollar went to Uncle Sam and the rich person kept 6 cents. That
was the law agreed to by Republicans and Democrats and signed by Franklin Roosevelt, the president.
Compare a 94% top rate to the current 39 or 39 and a half percent top rate. They're not even close.
What Mr. Biden is proposing is light years from what we achieved in the 1940s under Roosevelt.
So please understand, is Mr. Biden more progressive than Trump? No question. Is
he more progressive than Mr. Biden had been up until this point? No question. He is and AOC was
exactly right in noting that and giving him that recognition. But comparing Mr. Biden
to Mr. Roosevelt is crazy. There is no real comparison here beyond the similarities I've noted
because the differences are overwhelming.