Last week, at the University of Oregon, a young man with a table full of literature asked me if I supported workers. “Why, yes I do,” I replied. “Would you be interested in considering the Workers Party?” he asked.
Seeing Trotsky and Black Panther based literature, I said that I would certainly be open to listening to anything. As the young man discussed how Obama had “let down the workers,” he concluded by saying that they had no choice but to form their own party. “What is the party platform?” I asked. “It’s a non-hierarchial structure. We support the workers.”
As my husband and I walked through the beautiful Oregon campus, I couldn’t help drawing a parallel between the conversation I had just had, and another rather loosely defined grass roots movement, “Occupy Wall Street.” Occupy Wall Street has a more structured list of demands than the Workers Party, but only one of those demands has anything to do with Wall Street.
1. Place a fee on all Wall Street transactions and tax capital gains the same as income. At first blush, this looks to be an attempt to charge those institutions that benefited from significant bailout funds during the financial meltdown. Let’s see what effect such a charge would have.
The fee on transactions appears to be an attempt to limit speculation. Since this demand does not exempt tax-exempt or tax deferred transactions, your 401(k) contribution and your child’s tax exempt 529 college fund contributions are also Wall Street transaction. Therefore, if these transactions are taxed, those taxes will be added to the fees you pay investment managers, and sales (12(b)1) fees, decreasing your return on investment.
Second, taxing capital gains the same as income looks to be an attempt to ensure hedge fund managers pay ordinary income rates (15% – 35%) instead of long term capital gain rates (15%). That is a laudable goal.
If all capital gains are taxed at the same rate as income, however, that will mean that when a mutual fund manager sells a stock or a bond in your 401(k) or your child’s tax exempt 529 college fund, those taxes will be assessed upon those sales as well, negating the effect of tax exempt growth. You probably don’t want that.
This demand, then, would likely be altered to include non-tax exempt and deferred transactions. While that would be an improvement, it would also effect non-hedge fund managers (like you) when investing outside tax exempt and deferred accounts. This additional tax will lessen the return of the average investors personal funds. In other words, the little guy’s return will be decreased as well.
2. End corporate personhood and overturn the flawed Citizen’s United decision. This is a Supreme Court issue, in which corporations are considered the same as natureal persons for various activities, including campaign contributions.
Overturning this legislation is an excellent idea for those who oppose so-called political “attack ads” — and has nothing to do with Wall Street. It is a Supreme Court issue that would require legislative remedy.
3. Get big money out of politics through substantive campaign finance reform. This is a legislative issue that has nothing to do with Wall Street. It is a Congressional issue, one which was attempted by Senator John McCain, and was blocked by lobbyists. Another laudable goal, and one which must be accomplished through the Senate and the House of Representatives.
4. Jobs through investment in the public sector and infrastructure, not tax cuts for the wealthy and corporations. This appears to be support for the president’s job bill, as well as tax reform. Both are important and timely goals. Neither have anything to do with Wall Street.
“Occupy Wall Street: Occupy Portland” is coming on October 6, 2011. If you intend to support the goals of this movement, perhaps it’s worth considering the best way to accomplish these legislative goals — by demanding action from your Congressional representatives in the specific areas where you think grievances exist to be redressed.
And list your demands carefully.