This Week Shows, Again, Just How Different the 2 Parties Are -- Even on Economic Issues

Democratic U.S. presidential candidate Hillary Clinton speaks during a campaign rally in Baltimore, Maryland April 10, 2016.
Democratic U.S. presidential candidate Hillary Clinton speaks during a campaign rally in Baltimore, Maryland April 10, 2016. REUTERS/Jim Bourg

"Why bother? There's no difference between the parties anyway." We've all heard or read that sentiment. Libertarians love to make this claim. But they aren't the only ones. It's the argument behind the Ralph Nader vote in 2000. Although he didn't use those exact words, Nader himself said there were "few major differences between the two parties." On other occasions he all but adopted the "no difference" line, saying, for example: "It's a Tweedle Dee, Tweedle Dum vote ... Both parties are selling our government to big business paymasters ... That's a pretty serious similarity," and "they're morphing more and more on more and more issues into one corporate party."

Right now, we are choosing our party's nominee for president and the candidates' ideological differences are as stark as in any primary season since 1992, and perhaps since 1980. Whatever his chances of victory are at this point, Bernie Sanders -- whom I'm supporting -- could have been even or slightly ahead in the delegate count today had things broken his way by a few more percentage points in, say, Iowa and Nevada. Victories there plus in New Hampshire might well have given him valuable momentum in subsequent states that ended up going decisively for Secretary Clinton. The point is, this race could have gone either way.

If (as appears highly likely due to her existing delegate lead and the geographic distribution of the remaining delegates) Clinton is the nominee, that will be a serious disappointment -- to say the very least -- to those who believe Democrats need a radical shift leftward. We are hearing echoes of Ralph Nader -- in particular his claim that the two parties are indistinguishable on economic issues -- from those saying that it's "Bernie or Bust."

"I will never support Hillary Clinton," said Adam Burch, 28, of Minneapolis. "I identify as a socialist. She stands for everything that I'm against. It's Bernie or nothing."

Hillary is no different from the Republicans, the Bernie or Bust folks say, and the same goes for Obama and the Democratic Party in general. Although I do believe Bernie would be the better nominee and president than Hillary, I firmly reject this false equivalency.

Looking at what the Obama Administration has accomplished over seven plus years compared to what a President McCain or Romney would have done on any number of issues makes clear just how false this equivalency really is -- even on economic policy. But we don't need seven years to demonstrate this. All we need to do is simply look at the past week.

Corporations have avoided paying their proper share of federal taxes for some time, but recently they've gotten even more creative in their egregiousness. Two of the shadiest methods are: earnings stripping, where the U.S. branch of a corporation borrows money from another branch located somewhere else, and then deducts the interest -- which it is paying to itself -- thus reducing its income for U.S. tax purposes; and corporate inversions, where an American company merges with a foreign rival and creates a new company situated abroad, but where nothing changes about the American company other than the address on its letterhead. It's just as American as it was before, but the new company books its U.S. profits in another country with lower corporate tax rates. Lovely, no?

So what happened this week? The Obama administration, acting without Congress, issued new rules on both these fronts. According to Victor Fleischer at the New York Times, these new rules demonstrate that the administration has "drop[ped] the gloves." In other words, the Treasury Department's actions are intended to take a significant bite out of these kinds of tax avoidance schemes.

How much of a bite will it take? Pfizer had been all set to enact an inversion, merging with Irish rival Allergan in what would have been the biggest deal yet in dollar terms carried out with an eye toward reducing an American company's tax bill. The Treasury Department made its announcement on Monday. On Wednesday, Pfizer announced that the merger was off -- even though they'd owe Allergan a few hundred million dollars -- because, without the tax benefits they could no longer take advantage of, the deal made no sense. Score one for the American people.

What's really necessary is for Congress to take legislative action, but that's not going to happen with Republican majorities in both houses. Short of that, however, what happened this week will have a real impact in making it harder for corporations to skirt paying their fair share. Remember that such lost revenue has to be made up for by some combination of adding to our country's debt, raising taxes, or cutting spending. It really is a zero-sum game.

On another issue, we got new regulations from the Labor Department that require financial advisors to -- take a deep breath here -- actually put the interests of their clients ahead of their own, at least for those clients whose retirement accounts they manage. Radical idea, I know, but before this -- they didn't have to.

The financial industry fought the Labor Department's regulations tooth and nail, and did succeed in weakening them somewhat from the initial proposals. Nevertheless, the new rules should make a real difference:

"It has the potential to really change the way advice is delivered to retail investors," said Barbara Roper, director of investor protection at the Consumer Federation of America. "It is a really big deal. Revolutionary, even."

Within a day of the Labor Department's announcement, the difference between the parties on this issue became even more clear when the candidates running to represent Illinois in the U.S. Senate, Democratic Rep. Tammy Duckworth and Republican Sen. Mark Kirk, staked out opposing positions.

Finally, the Department of Housing and Urban Development clarified how it is going to interpret the Fair Housing Act going forward. HUD, led by Secretary Julián Castro (on most people's short list to be Hillary Clinton's vice president) announced that landlords could no longer simply refuse, as a policy, to rent to potential tenants based on them either having a criminal record or their having been arrested in the past. As Mireya Navarro explained:

Federal officials said landlords must distinguish between arrests and convictions and cannot use an arrest to ban applicants. In the case of applicants with convictions, property owners must prove that the exclusion is justified and consider factors like the nature and severity of the crime in assessing prospective tenants before excluding someone.

Secretary Castro himself wrote on Monday:

Democrats are by no means perfect on economic issues. They do need to move further to the left, to act more aggressively to combat economic inequality, and to ensure that everyone is able to reach their economic potential.

Nevertheless, ask yourself whether a Republican administration would have issued similar rules on any of these topics. Ask yourself whether it would have been business as usual for people trying to get good advice on building a nest egg for retirement, or for the corporations -- whom Democrats like President Obama and Secretary Clinton supposedly serve just as eagerly as Republicans do -- trying to dodge paying taxes on their massive profits, or for the ex-offenders trying to find an apartment to rent: People who have served their time for a non-violent crime or were arrested but not even convicted, yet weren't given a chance to make their case to a landlord.

All of these advances matter to real people. Each of them will make our economy work better for the 99 percent and/or increase economic opportunity specifically for those on the bottom rungs of the economic ladder.

None of them would have occurred under a Republican president. And that's all in one short week.