GOP Tax Bill Pushes United States Toward World’s Most Extreme Inequality

The tax cut law the GOP-run Congress passed and GOP President Donald Trump signed “stakes out America’s bid to become the most extreme society in the world” in unequal distribution of wealth, a new United Nations report says.

And, adds Philip Alston, the UN’s specialist on extreme poverty and human rights, that chasm is “shockingly at odds with” among other things, the nation’s “founding commitment to human rights.”  And poverty is also laced with “racist stereotypes are not far below the surface” in condemnation of the poor, and their second-class economic and political status, he said.

Alston issued his report in mid-December, as Congress was on the verge of approving the $1.5 trillion 10-year tax cut for corporations and the rich. He included analysis of the law in his report. He did not specifically discuss worker rights – or lack of them.

Non-partisan studies, notably from the congressional Joint Committee on Taxation, calculate more than 80 percent of the tax cut’s benefits, through 2027, go the top 10 percent of the population with more than 60 percent of the overall benefits going to the top 1 percent.

Meanwhile, the poorest people would see their tax rate on their first dollars of income rise from 10 percent now to 12 percent after the law fully takes effect. Tax rates on the “last dollars,” those earned by the 1 percent, decline by several percentage points.

Alston reported his findings after a 2-week trip through the U.S. and interviews with citizens in Alabama, Florida, California, Georgia, Puerto Rico and D.C. along with discussions with analysts, private organizations and government officials. He concluded the tax cut would exacerbate current poverty in the U.S. Approximately 47 million U.S. people, or one of every seven, live in such poverty.

Existence of extreme poverty “undermines enjoyment of human rights by its citizens,” Alston said. “U.S. inequality levels are far higher than those in most European countries.”

Alston, an Australian native who now holds a prestigious law school chair at New York University, has not been shy about investigating the issues worldwide. An extensive bio noted he was the official who blew the whistle on his own organization, the UN., for responsibility for the cholera epidemic in Haiti, caused by peacekeeping soldiers the UN sent.

The tax cut and its aftermath – proposed GOP cuts in Medicare, Social Security and other domestic programs to help reduce the $1.5 trillion hole -- will only make things worse, Alston predicted.

“The dramatic cuts in welfare, foreshadowed by the president and (House) Speaker (Paul) Ryan, and already beginning to be implemented by the administration, will essentially shred crucial dimensions of a safety net that is already full of holes,” Alston warned. 

Despite some positive signs, including efforts by some state and local governments, along with private charities, to improve the lot of the poor, Alston reported many disturbing scenes. He found 55,000 homeless people in L.A. alone, and outbreaks of dangerous hookworm-caused disease in poverty-stricken areas of Lowndes County, Ala., among other conditions, for example.

He reported the communicable disease outbreak in Alabama could easily happen elsewhere due to “sewage-filled yards in states where governments don’t consider sanitation to be their responsibility.” Elsewhere, “I saw people who had lost all their teeth” because most programs for poor adults don’t pay for dental care.

And increasing opioid addition is leading to rising death rates, he noted – a finding backed by recent federal data, which show a statistically significant decline in U.S. life expectancy for the second year in a row. That is due to the opioid addiction spread, the federal Centers for Disease Control said.

The criminal justice system doesn’t help, Alston noted, as “thousands of poor people get minor infraction notices which seem to be intentionally designed to quickly explode into unpayable debt, incarceration, and the replenishment of municipal coffers.” Alston specifically cited that pattern in Ferguson, Mo., site of the notorious police killing of unarmed African-American teenager Michael Brown. Other reports show the practice is frequent in the South.

"And I met with people in the South of Puerto Rico living next to a mountain of completely unprotected coal ash which rains down upon them bringing illness, disability and death,” and that was after the ravages of the hurricanes. Due to congressionally imposed financial controls and orders to cut social service spending, Puerto Ricans, he adds, view themselves as living in a colony.

“Americans can expect to live shorter and sicker lives, compared to people living in any other rich democracy, and the ‘health gap’ between the U.S. and its peer countries continues to grow,” despite the U.S. spending more per person on health care than any other nation, Alston reported. “And neglected tropical diseases, including Zika, are increasingly common in the U.S.  It has been estimated 12 million Americans live with a neglected parasitic infection.”

While “there is no magic recipe for eliminating extreme poverty,” political will could foster measures to achieve that goal, Alston said. But instead political will is used to reinforce racist stereotypes about African-Americans and Latinos – even though whites are the plurality among the poor – and to disenfranchise them through voter ID laws and other restrictions.

“What is known, from long experience and in light of the government’s human rights obligations,” through signing – though not ratifying – UN pacts pledging nations to attack poverty “is that there are indispensable ingredients for a set of policies designed to eliminate poverty. They include: Democratic decision-making, full employment policies, social protection for the vulnerable, a fair and effective justice system, gender and racial equality and respect for human dignity, responsible fiscal policies, and environmental justice.”

“Currently, the United States falls far short on each of these issues,” he said.

Ben Betz of People for the American Way, whose group publicized Alston’s report, went farther, admittedly in a fundraising letter: “Trump Republicans are trying to KILL the American Way -- and not just with their shameful tax and budget agenda, but with their endless attacks on Americans’ fundamental rights, our democratic institutions, our federal judiciary, and more.”       

Posted In: Allied Approaches