Economic Justice for all

Racism cannot be separated from capitalism - Angela Davis

In a just and equitable society, there is no room for extreme wealth inequality. Over the last several decades - while most working Americans have endured stagnant wages and skyrocketing cost of living, healthcare, and education expenses - we’ve witnessed immense wealth and political power concentrate in the hands of the very few. Year after year - corporations like Amazon, Netflix, IBM, Chevron and countless others pay zero federal income tax, and billionaires like Donald Trump pay insultingly low amounts. In 2017, Congress passed a $2 trillion deficit-financed tax cuts package for corporations and the ultra wealthy without batting an eye, yet those same lawmakers suddenly worry about the debt and deficit whenever discussing bailouts of working people. We must stop balancing the budget on the backs of the working class. It is past time that we establish a government that works for all of us, not just those at the top.

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Extreme wealth inequality is corrosive to democracy and antithetical to justice. In the United States, white supremacy and unfettered capitalism have worked hand in glove to try and inhibit economic growth within Black, Indigenous, Latinx, and other communities of color. From the Tulsa Race Massacre of 1921 - whereby a violent white mob desecrated hundreds of Black-owned businesses on Black Wall Street and terrorized and murdered Black residents in Tulsa, Oklahoma -  to the Federal Housing Administration (FHA) orchestrating a decades-long system of state-sponsored redlining that shut-out countless Black, Latinx, and Indigenous people from homeownership - there are countless, sobering historical examples of how capitalism has been weaponized as a tool of racial oppression.

No developed nation on the planet compares to the massive socioeconomic inequities we have here in the United States. According to Pew Research Center, from 2001 to 2016, upper-income families saw their wealth increase by a median 33% while middle-income families lost 20% of their wealth, and low-income families lost a whopping 45%. As we all know, the widening wealth gap was supercharged by the 2008 economic crash that was catalyzed by decades of financial deregulation and the repeal of the Glass-Steagall Act (allowing commercial and investment banks to consolidate for the first time in roughly 50 years).

But as is the case with each national crisis, its impact falls disproportionately on the most marginalized and vulnerable. By 2013 - five years after the crash - the net worth of white households was estimated to be 13 times greater than Black households. Black Americans lost 40% of their wealth as a result of the 2008 economic crash, and continue to be targeted by predatory lenders who are further driving debt in Black and brown communities. 

Even now, the total percentage of qualified Black and Latinx mortgage applications falls far below that of white Americans. A 2019 Lending Tree report found that mortgage applications from Black Americans are denied at almost twice the rate of Whites - 17.4% versus 7.9%. In short - this is what economic racism looks like. Our financial system has never truly worked to build racial and economic equity; instead, it’s led to enormous pain and suffering. And as I’ve discussed under my Housing for All and other platforms, there remain larger racial and economic disparities that we must abolish in order to establish a true system of justice and equity. 

And of course, in 2020, amidst a once-in-a-century pandemic, as millions of Americans lost their jobs, wages, homes, healthcare, and other basic needs; the United States minted 46 new billionaires. Since March 2020 - U.S. billionaires collectively raised their wealth by an eye-popping $1.1 trillion. That’s higher than the total cost of the December 2020 stimulus package (~$900 billion) that left working people with a paltry and insulting $600 one-time payment.

For decades, we have deployed a system of financial deregulation, tax cuts for corporations and the wealthy, and taxpayer subsidies and bailouts of the top 1% - while leaving the bottom 99% subject to ever-growing budget austerity, means-testing, and the erosion of the social safety net. Lawmakers like Brad Sherman have spent years championing corporate interests behind the scenes - both by receiving hundreds of thousands in corporate campaign donations each cycle to voting for laws like the Gramm-Leach-Bliley Act that allowed commercial and investment banks to consolidate - setting the stage for the subprime mortgage crisis of 2008. 

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We must end corporate welfare and invest in structural reform to uplift and empower the working class, rebuild our middle class, and ensure economic and racial justice for all. We must create a progressive taxation system that guarantees the wealthy pay their fair share so all of us can reap the benefits of healthcare, education, housing, and a living wage for all. As Angela Davis said, “As long as we inhabit a capitalist democracy, a future of racial equality, gender equality, and economic equality will elude us.” That is why we must:

Guarantee union rights for all

  • Since passage of the Taft-Hartley Act decades ago, there has been a systematic assault on labor rights by corporations across the country. Over two-dozen states have so-called “right to work” laws that thwart union and collective bargaining rights for millions of workers. Union busting has become the norm for billion-dollar corporations from Amazon to Tesla.

  • Meanwhile, Prop 22 here in California has decimated the rights of gig workers by denying them basic employee protections. These assaults disproportionately harm our low-income and workers of color, and perpetuate cycles of poverty and abuse.

  • We are past due for an overhaul of our labor laws in America. We must enact the PRO Act, living wages for all, and guarantee union rights for all workers, including domestic, gig, and tipped workers.

Impose a wealth tax on the top 0.1 percent

  • As outlined by Senator Bernie Sanders, a progressive wealth tax on the top 0.1 percent of earners would apply to all married couples starting with a combined net worth/assets of $32 million or higher. Those making between $32 million and $50 million would be subject to a 1% tax, going up to an 8% tax on married couples making above $10 billion.

  • This tax would generate $4.35 trillion over a decade. This revenue would be directed towards bailouts of working people - such as by cancelling all student debt, which costs $1.6 trillion in total.

Enact a living wage (at least $15) permanently indexed to inflation and cost of living for all workers, including tipped and gig workers

  • Poverty is a policy decision. While the City of Los Angeles raised the minimum wage to $15 back in 2015, it took five years to implement and is not tied to inflation. Rising cost of living is shutting more and more workers out of being able to afford basic necessities like housing. Meanwhile, destructive, corporate-friendly state laws like Prop 22 have gutted the rights and finances of gig workers in California - and can soon spread to states like New York.

  • Consumer tips cannot replace a living wage. Sub-minimum wages perpetuate the legacy of slavery and exploit workers. It’s past time to enact a living wage indexed to inflation for all workers.

Cancel all fossil fuel subsidies

End predatory payday lending

  • Predatory payday loans are typically small cash advances ($500 or less) that come with astronomically high interest rates at an average of 400% or higher.

  • Payday lenders target low-income Black and brown people, the elderly, young people, and other working people living paycheck to paycheck who typically don’t have bank accounts or other options to pay everyday expenses like rent, bills, and car payments. They trap people in destructive cycles of debt with unprecedented interest rates.

  • I strongly support the Loan Shark Prevention Act introduced by Rep. Ocasio-Cortez and Senator Sanders which would establish a national interest rate cap of 15% on consumer loans.

Establish Public Banking

  • Here in Los Angeles, nearly 7% of residents are unbanked, which is higher than the national average. Among Latinx Angelenos, over 14% lack banking access. Millions of Americans nationwide - disproportionately low-income and people of color - lack basic checking and savings accounts.

  • Lack of banking perpetuates cycles of poverty by increasing reliance on predatory lenders who charge exorbitant interest rates. In addition, many minority-owned businesses without historical access to large banking institutions are shut out of receiving loans to help them sustain or grow their business. We saw how small businesses without relationships with big banks were shut out of receiving PPP loans during the pandemic.

  • Public banking for all would solve this by funding the creation of publicly-owned state and local banks which will offer very low or zero interest loans to individuals, small businesses, and governments.

Impose a tax on Wall Street Speculation

  • We can generate up to $2.4 trillion over the course of a decade by imposing a simple tax on Wall Street sales of stocks, bonds, and derivatives. For too long, Wall Street investors have used our pensions, mortgages, and student loans as their personal casinos, cashing-in while the American people have been priced out. We’ve showered trillion-dollar bailouts on “too big to fail” banks, and left working people without the ability to pay rent, put food on the table, and afford their healthcare.  

  • A Wall Street speculation tax would have the added benefit of deterring high-risk trading that can further destabilize the financial sector while producing no real economic value for average Americans. 

Eliminate the income cap for the Social Security tax

  • Currently, only individuals making up to roughly $138,000 annually are subject to the 6.2% annual Social Security tax. This places the overwhelming burden of paying into Social Security on the backs of working and middle-class families, and excludes top earners from paying their fair share. No more. 

  • We must also ensure that workers receive the same benefits as under current Social Security law, meaning that higher earners would not be subject to higher benefits just because they pay a higher overall amount into Social Security.

Re-establish a marginal tax rate of 91% on individuals with annual incomes of $10 million or higher

  • The post-WW2 period in the United States saw the creation of the American middle class. From 1944 until 1963, the top marginal tax rate never dipped below 81%, and remained at 91% for nearly a decade. 

  • Under my plan, the seven current tax brackets would be unaffected; instead, any individual making over $10 million annually would have their annual income above the $10 million threshold be subject to the 91% marginal tax rate.

Eliminate perverse tax loopholes and incentives for the ultra-wealthy

  • Our tax system is rigged in favor of the ultra-wealthy, while the most vulnerable among us are subject to crippling tax burdens, high cost of living, and stagnant wages. 

  • For example, taxes on capital assets are only realized when those assets are sold - even if those assets continue gaining tremendous value in the interim (called “unrealized” capital gains). 

    • Even more, the wealthy can borrow against those assets since that borrowing is also not subject to tax. In 2016, the top 1% held a whopping 62% of all unrealized capital gains. 

    • Further, if an individual holds their capital assets until death and then bequeaths it to their children, the person “inheriting” that wealth would not pay a dime in taxes - their tax burden would start accruing on any gains made after the inheritance. 

  • Also, under the Tax Cuts and Jobs Act, the estate tax exemption was raised to nearly $23 million for couples; and according to a report by the Tax Policy Center, only 1 out of every 1,400 people would pay any estate tax under the law. 

Repeal the Tax Cuts and Jobs Act

  • Trump and his GOP cronies jammed a $2 trillion deficit-financed tax cut through budget reconciliation in 2017, gutting federal revenues to cover essential services and social safety net programs. 

  • The law brought down the top corporate tax rate from 35% to a flat rate of 21% - bringing the US corporate tax rate below the OECD average -  and eliminated the graduated corporate tax schedule altogether. 

Eliminate the corrupt impact of money on politics by overturning Citizens’ United, ending Super PACs, and enacting Ranked Choice Voting and publicly funded elections

  • Money is not speech, period. We must overturn Citizens’ United that has opened the floodgates for unlimited corporate spending on political campaigns, turning our election system into an auction. 

  • Similarly, we must end Super PACs which are effectively excluded from disclosing their donors despite being able to accept unlimited sums. 

  • I strongly support a permanent ban on campaign donations from federal lobbyists and corporations, and wholeheartedly support Ranked Choice Voting and publicly funded elections.