Economy & Budget

A Tale of Two Investors

Investors are the best of people and they are the worst of people.

They are victims and they are victimizers.

Which of these contradictory things Democratic politicians depict them as at any moment depends not on the true merits of investors as human beings but on how they fit into the prevailing pattern of Democratic class-war politics.

Last year we met the defrauded Enron investor. He was the best of people. A victim of corporate greed if ever there was one. Democrats celebrated this investor as the backbone of the free enterprise system.

In March, then-Senate Majority Leader Tom Daschle (S.D.) announced that Democrats would push legislation to protect stockholders-the salt of the earth.

"I love the idea that anybody in America, even with very small investments, can be part of the growth of our nation," said Daschle.

He vowed to defend "innocent consumers and investors, employees who depend on stock investment for their children’s college funds, for their retirement nest eggs and for their savings."

"Nearly one in two Americans," he noted, "are investing in the stock market today."

Democratic Sen. Joe Lieberman (Conn.) painted an even more fetching portrait of the populist stockholder. Announcing that his Investigations subcommittee would probe Enron’s collapse, Lieberman merged the ultimate heroes of 2001-American firemen-with the ultimate victims of 2002-American investors.

"One of the most lasting memories I have from the 2000 national campaign," said Lieberman, "is a morning when former Vice President Gore and I were sitting and having breakfast at about 6:00 a.m. with a group of firefighters at a firehouse in-where else-Florida. And at one point, we asked the firefighters, ‘What do you talk about on a typical morning here when you’re having breakfast?’ And I certainly expected the answer to be sports or firefighting or family. The answer was, ‘On a typical morning at this firehouse, we talk about the stock market.’"

Protecting the interests of stockholders, said Lieberman, "affects the quality of life of those firefighters in Florida and millions of middle-class investors who want to participate in the larger American dream of growth and prosperity without fear of being swindled out of their hard-earned savings and investments."

So where are those firemen now? Who is swindling them now? And who is trying to protect their stake in the American dream?

President Bush has now called for eliminating the tax stockholders pay on dividends. "It’s unfair to tax money twice," explained Bush. ". . . In dividends, we tax the corporate profit, and then we tax the money being sent to the shareholder."

"Corporations pay 35%; individuals come back and pay probably 27%, or 30%, or 37%," Republican Sen. Don Nickles (Okla.) told NBC’s "Meet the Press" last week. "Uncle Sam is taking about 60, maybe 70% of the revenues."

The government’s double dipping resembles the sneaky dealings of Enron-because the first tax levied on the corporation might not be apparent to investors who pay the second tax on the dividends.

But, alas, protecting investors from swindlers no longer concerns Democratic politicians. In fact, in Democratic rhetoric, Scrooge has replaced the humble fireman. Investors are no longer the best of people, they are the worst of people-victimizing the poor in greedy pursuit of greater wealth.

When Bush’s proposal leaked, Sen. John Edwards (N.C.), a Democratic presidential candidate, called it "greatly slanted to help the richest Americans." House Minority Leader Nancy Pelosi (Calif.) labeled it "a plan to help the high-end." Tom Daschle (S.D.), forsaking last year’s mom-and-pop investors "who depend on stock investment for their children’s college funds," declared it "the wrong idea at the wrong time to help the wrong people."

Sen. Harry Reid of Nevada accused Republicans of waging "class warfare."

The moral of this story is that the real war the Democrats are fighting is not against the rich on behalf of the poor, it is against the people on behalf of the government. If only two people still worked in America, and one made $5 a year while the other made $4, the Democrats would still attack any cut in taxes as a sop to the richer guy.

And it wouldn’t matter if both were firemen.


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