In this segment from the American TV programme Democracy Now! author Jacob Hacker explains why the rich are getting richer:

Amy Goodman (Standard American accent)

… Blues by B.B. King here on Democracy Now, democracynow.org, the War and Peace Report, I’m  Amy Goodman with Juan Gonzalez:

Juan Gonzalez (Standard American accent)

Well, on Capitol Hill, Senate Republicans are threatening to filibuster every bill until the Democrats agree to extend the Bush era tax cuts to all income groups. The Obama administration and many Democrats want to retain the lower rates only for individuals with annual incomes of 200,000 or less and for married couples earning no more than $250,000 a year. On Wednesday all 42 Senate Republicans co-signed a letter issuing the threat. Just 41 votes are needed to filibuster legislation. Senator Harry Reid criticized the Republican effort:

Senator Harry Reid (Standard American accent)

With this letter they have simply put in writing a political strategy that the Republicans have pursued this entire Congress; namely obstruct, delay, obstruct, delay action on critical matters, and then blame the Democrats for not addressing the needs of the American people.

Amy Goodman

To talk more about the debate over tax cuts, we’re joined by Jacob Happer… Hacker. He is Professor of Political Science at Yale University, and co-author, with Paul Pierson, of the new book, Winner-Take-all Politics: How Washington Made the Rich Richer and Turned its Back on the Middle Class. How did Washington make the rich richer, Jacob Hacker?

Jacob Hacker (Standard American accent)

Well, Washington made the rich richer most simply by slashing taxes on the richest of Americans. That… that’s probably the easiest part of the story to understand. If you look at the richest 400 tax payers, in the 1960s they paid an average individual federal income tax rate of around 40 per cent. By the 1990s that was 30 per cent, by 2007 it was just over 16 per cent. We’re talking about a huge transfer of income to the top through tax cuts that were precisely targeted on the very highest rungs of the income ladder. In the book Paul and I call these “economic smart bombs”: they basically brought… payloads of cash to carefully targeted recipients and… and, you know, recently Warren Buffett actually said that he thinks he pays a higher… sorry, that he thinks that his secretary pays a higher tax rate than he does. So this… this is… this is one of the big parts of the story we tell in the book.

Amy Goodman

Let’s go to Warren Buffett, the billionaire investor, who was talking to ABC News:

Warren Buffett (Standard American accent)

I think that people at the high end, people like myself, should be paying a lot more in taxes. We have it better than we’ve ever had it.

Christiane Amanpour (Standard British accent)

They say that you have to keep those tax cuts, even on the very wealthy, because that it what energises business and… and capitalism.

Warren Buffett

Well, the rich are always going to say, that, you know… “Just give us some more money and we’ll go out and spend more and then it’ll all trickle down to the rest of you,” but that has not worked in the last 10 years and… and I hope the American public is catching on.

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