The Fallacy of Discrimination Against the Rich

In a recent CNN news video posted online about “middle class values?” Wall Street Journal columnist Stephen Moore claims that “the only people you can legally discriminate against in this country anymore is rich people.” I was shocked by both his flippant treatment of such a truly important topic. His statement is both sadly uninformed about the one (at least) truly legal form of a discrimination we embrace and also dismissive of the continuing legacy of de facto discrimination and seemingly race-neutral policies that handicaps segments of our nation and also our collective betterment.

There truly is no credence to calling the treatment of rich “discrimination.” This claim is clearly based solely on the levying of the personal income tax (or alternatively on populist rhetoric which is just that…rhetoric). A progressive income tax was first implemented in 1862 to support the US Civil War. Though it was ruled unconstitutional by the US Supreme Court in 1894, it was later enabled by the 16th Amendment. Given that the income tax has been progressive since it’s origin in the US, it is outright wrong to imply that it’s progressive nature is a form of discrimination against wealthy individuals. Besides, income is taxed in tiers such that the first $30,000 a banker earns and the only $30,000 a farmer owns are treated equally.

In addition, the income tax is just part of the tax equation. The sales tax is notoriously a regressive tax in that it composes a higher percentage of a lower-income household’s budget than that of a higher-income household. The maximum eligible income for the Social Security tax of $110,000 makes the effective tax rate for the aforementioned farmer much higher than the tax rate of the banker earning well-over the limit. Lastly, the mortgage interest deduction was estimated at $131 billion for 2010. This goes only to homeowners, favors those with larger and more expensive homes and is disproportionately used by those who have more wealth and are more sophisticated about navigating the federal tax code. Renters, a less wealthy group, face a higher tax liability because they cannot equally deduct other parts of their capital accumulation. Lastly, we don’t even tax wealth just the income that one earns each year (which is not to say that would be discrimination if we did). When you consider the entire taxation picture, the notion of discriminating against wealthy individuals holds no water at all.

Yet, that is probably the least important point because there actually is one group that is unambiguously discriminated in practically every walk of life, codified in public policy, and relegated to the outskirts of American societies: felons. They may have lost their right to vote, of face a often insurmountable challenge in regaining it, they can be denied jobs often indiscriminately (though this appears to be changing under the Obama Administration), they are barred from public housing under get tough on crime policies and they are denied various other benefits they would otherwise receive and would enable them to keep from re-offending. Michelle Alexander’s book, The New Jim Crow, is a searing indictment of the system and it also raises the subject of how the combination of racially discriminatory enforcement and prosecution disproportionately apply the stigma of criminality to men (and women) of color. This subjects a vast number of people of color to worse treatment than that of the much-aligned system of Jim Crow, and it is perfectly legal. The treatment of the rich is obviously nothing compared this.

I won’t dwell much on the degree to which pure racial discrimination everyone acknowledges has plagued this nation in the past still exists. Darker-skinned African American job applicants have been demonstrated to have a harder time getting job interests than lighter-skinned African American candidates. White males with criminal records have notoriously shown to get more responses for job applications than black males with no criminal records. A young high school boy is dead because of his clothes and skin-color prompted suspicion in a gated community, even though he was a guest and walking from the convenience store with lemonade and skittles.

To be sure, much of the discrimination happens that isn’t legal. Much of the challenge is how to identify internal behaviors and decisions that are easily rationalized as non-racialized and prevent them from taking place. Yet, despite its illegality racial profiling is often advocated and the discrimination again felons is entirely legal. Targeting communities of color for stop-and-frisk laws is defended in the name of preventing violence. It’s clear that unlike the imagined discrimination against rich people, there has been and continues to be system of unequal treatment of black and brown people.

The way I see it, Moore’s statement identifies how uninformed he is about something he makes a living talking and writing about, while the people he defends are rich and the people he conveniently ignores can’t find work because he is down-playing (one of) their ailments as an agenda item in our nation’s discourse. I would call it ironic, but frankly it’s just too indicative of the tragedy of our politics, our society and, frankly, our values for me to take comfort.