It's Labor vs. Capital, Stupid

In the 1976 movie, Network, anchorman Howard Beale implores his viewing audience:

Things have got to change. But first, you've gotta get mad!... You've got to say, 'I'm as mad as hell, and I'm not going to take this anymore!' Then we'll figure out what to do about the depression and the inflation and the oil crisis. But first get up out of your chairs, open the window, stick your head out, and yell, and say it: "I'M AS MAD AS HELL, AND I'M NOT GOING TO TAKE THIS ANYMORE!"

We're mad as hell and we're not going to take this anymore. That is the message of the sit-ins by U.S. Uncut, the protests against Bank of America, the occupation of Freedom Plaza in Washington, D.C. to protest the war, Occupy Wall Street and the growing numbers of #Occupy demonstrations around the country.

We're mad at the devastation wrought in the last four years by the toxic combination of unrestrained greed and concentrated wealth. Twelve to fifteen million families have received foreclosure notices. Seven to ten million more are unemployed. Median household income has fallen to its lowest level in more than a decade while the poverty rate is at a 17-year high. The number of homeless in New York City rose to an all-time high last year -- higher, even, than during the Great Depression.

We're mad at Wall Street for taking our money and giving nothing back. Banks have received nearly $10 trillion in bailouts. In 2010, they handed out $149 billion in bonuses and compensation, near an all-time high. But lending has fallen by nine percent since 2008.

One percent of Americans now take in more than a quarter of the nation's income every year. In New York City, home to Wall Street, the top one percent took for themselves close to 44 percent of all income in New York during 2007 (the last year for which data is available).

"We are the 99%" is a fitting slogan for the new movements.

Conservatives have been remarkably successful in persuading us that government is the enemy. The 99 percenters know that is true only inasmuch as the government is captured by the 1 percenters. We are angry at government, but what makes us more angry is that in this system you get the government you pay for and 99% of us aren't able to do any buying.

We're mad at government, but we haven't given up on governance, on the right to make the rules.

Last week the General Assembly of Occupy Wall Street adopted a declaration of principles that will inform the new rules:

As we gather together in solidarity to express a feeling of mass injustice, we must not lose sight of what brought us together. We write so that all people who feel wronged by the corporate forces of the world can know that we are your allies.

As one people, united, we acknowledge the reality that the future of the human race requires the cooperation of its members; that our system must protect our rights, and upon corruption of that system, it is up to the individuals to protect their own rights, and those of their neighbors; that a democratic government derives its just power from the people, but corporations do not seek consent to extract wealth from the people and the Earth; and that no true democracy is attainable when the process is determined by economic power.

We come to you at a time when corporations -- which place profit over people, self-interest over justice, and oppression over equality -- run our governments. We have peaceably assembled here, as is our right, to let these facts be known.

From that declaration of principles a program will emerge. The conversation about what that program will consist of has started. To contribute to that conversation I propose that it include five new rules: two constitutional amendments and three laws.

1. Corporations are not persons

The 14th Amendment gave African-American the constitutional right of citizenship: "All persons born or naturalized in the United States...are citizens of the United States.... No State shall... deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws."

In 1886, a court clerk wrote a headnote to a case that case that had nothing to do with corporate personhood:

"The court does not wish to hear argument on the question whether the provision in the Fourteenth Amendment to the Constitution, which forbids a State to deny to any person within its jurisdiction the equal protection of the laws, applies to these corporations. We are all of the opinion that it does."

Some 65 years later Justice William O. Douglas observed that "the Santa Clara case becomes one of the most momentous of all our decisions...Corporations were now armed with constitutional prerogatives." And they made the most of these new prerogatives.

In the next 20 years, relying on the 1886 "precedent," the Supreme Court steadily expanded the number of Constitutional rights accorded to this new type of person. In 1893 the Court accorded corporations the right of due process under the 5th Amendment. In 1906 it extended the protection against search and seizure in the 4th Amendment. In 1908 it gave corporations the 6th Amendment right to a trial by jury.

In early 2010, the Supreme Court gave corporations the right, as persons, to spend unlimited amounts of money to influence elections.

We need a new four-word constitutional amendment: corporations are not persons.

2. Money is not speech

In 1976 the Supreme Court ruled that money is speech and therefore protected by the First Amendment. Today money has corrupted our political system. Political scientist Thomas Ferguson observes, "Public opinion has only a weak and inconstant influence on policy. The political system is largely investor-driven, and runs on enormous quantities of money."

When states or the federal government have tried to make elections fairer, the Supreme Court has stood in the way. Vermont passed a law to cap campaign expenditures for state offices. The Court struck it down.

Congress tried to stop billionaire candidates from spending an unlimited amount of their own money on their own campaigns. The Court struck down the law. Speaking for a 5-4 majority, Justice Samuel Alito told Congress that trying to "level electoral opportunities for candidates of different personal wealth" is not "a legitimate government objective."

Combine the Supreme Court rulings that money is speech and that corporations are persons and you have a lethal cocktail. Jamie Raskin, a Maryland state senator and law professor at American University points reports that Fortune 100 corporations had profits in 2008 totaling about $600 billion. If they spent only one percent of their profits on elections, a trivial sum to protect and foster their interests, the total comes to $6 billion. That is more money than was spent for and on behalf of all congressional and presidential candidates in 2008.

We need a new four-word constitutional amendment. Money is not speech.

3. Tax financial transactions

In 1936, John Maynard Keynes first proposed a financial transactions tax. "The introduction of a substantial Government transfer tax on all transactions might prove the most serviceable reform available, with a view to mitigating the predominance of speculation over enterprise in the United States," he wrote.

Economist Dean Baker suggests that a modest tax (0.25 percent) could easily raise more than $100 billion a year. "A small increase in trading costs would be a very manageable burden for those who are using financial markets to support productive economic activity. However, it would impose serious costs on those who see the financial markets as a casino in which they place their bets by the day, hour or minute," Baker says.

4. Tax all income as ordinary income

Billionaire Warren Buffett has commented on the unfairness of his having a lower tax rate than his secretary. That occurs because most of his income derives from dividends and capital gains taxed at half the rate as income from work.

In 2007, the 400 Americans with the highest income -- nearly $345 million -- were taxed at less than 17 percent -- less than half the ordinary income tax rate of 35 percent because most of their income was derived from investments. If we were to require that all their income be taxed at the 1999 tax rate of 39.6% this alone would generate an additional $300 billion in revenue over the next 10 years.

5. Declare a moratorium on foreclosures

Foreclosures hurt individuals, neighborhoods and the economy. Dumping millions of homes on the market depresses the overall value of all real estate, increases unemployment and disrupts lives and neighborhoods.

The most effective way to stop the tidal wave of foreclosures is through permanent, sustainable loan modifications. In a 2010 report, National Peoples Action proposed one strategy:

"Across the country, some 11 million homeowners are $766 billion under water with their mortgages. Paid off over 30 years this means $73 billion a year needed to reset all underwater homeowners' principals and interest rates would be about half of the $143 billion the top six banks alone are getting ready to pay in 2010 in bonuses and compensation. Even if the top six banks were to absorb the full cost of modifying all underwater mortgages in the country, they would still have $70 billion left for bonuses and compensation."

The Wall Street occupiers have taken a stand against monied democracy and corporate power. We would do well to join them. Make your voices heard. And demand new rules that will honor the 99% and restore democracy to the nation.