Debunking Myths About Wealth and Race
It’s not individual behavior that drives the racial wealth divide — it’s a system that many folks pretend doesn’t exist.
by Josh Hoxie
During the Gilded Age of the late 19th century, when levels of inequality were as sky-high as they are today, progressive reformers fought for the right to use citizen-led petition campaigns to circumvent the power of economic elites.
This right is now available in 24 states and Washington, D.C. through ballot initiatives. And in a year in which Bernie Sanders pushed inequality into the center of the primary debates, it’s not surprising that many of the 2016 initiatives reflect the public’s growing outrage over our return to Gilded Age-level divides.
Of course corporate-backed groups are putting up big money to undercut this form of direct democracy. But North Dakota voters already notched one victory for the little guy in their June primary when they voted 3-to-1 to uphold rules prohibiting corporate farming. Here are some of the other key inequality-related state ballot initiatives we’ll be watching on election night.
In 2012, California temporarily raised state income taxes on millionaires to the highest in the country, with a rate of 13.3 percent on incomes over $1 million. In the years following, the Golden State economy has flourished, disproving conservative economists’ predictions that calamity would ensue. Voters will decide on Tuesday whether to extend this tax increase, and the $4 billion-$9 billion in annual revenue that would come with it, for another dozen years.
Oregon’s corporate taxes on large and profitable corporations are the lowest in the country. The group A Better Oregon is working to change that through Measure 97, which would raises rates on corporations with over $25 million in sales in the state, with revenue earmarked to fund education, health care, and senior services.
Question 2 on Maine’s ballot would add a 3 percent tax on the incomes of households earning more than $200,000 a year. The initiative would further reduce inequality by channeling revenue towards closing the gap between rich and poor school districts.
In 2014, minimum wage measures won in all of the five states where they were on the ballots, including in the four red states of Alaska, Arkansas, Nebraska, and South Dakota. This year, voters in four states — Maine, Colorado, Arizona, and Washington — will have the chance to lift up the bottom of the wage scale.
Maine’s Question 4 is of particular interest because it would phase out the subminimum wage for restaurant servers and other tipped workers by no later than 2024. The Maine, Arizona, and Colorado initiatives each tick up the wage to $12 per hour by 2020, while Washington goes up to $13.50. Arizona and Washington also include earned sick leave protections.
In South Dakota, living wage advocates are in defense mode. After winning a raise in the minimum wage from $7.50 to $8.50 in the last election, they’re now fighting an initiative that would claw back that raise for workers under 18 years old. MIT’s Living Wage Calculator shows the hourly living wage for an individual with no dependents in South Dakota is $9.54 for a full-time worker. It jumps to $19.87 for a single parent.
Proposition 61 prohibits the state of California from paying more than U.S. Department of Veterans Affairs does for the same pharmaceuticals. This would include medicine purchased for state employees and retirees, university students, prison inmates, uninsured people with HIV/AIDS, and residents covered by the state’s public insurance program.
Big Pharma has spent nearly $90 million to defeat the proposal with plans to spend over $100 million before Election Day, making this initiative the most expensive in 2016. These corporate giants have good reason to worry. With a win in California, this campaign could spread to other states and to the federal level where Senator Bernie Sanders aims to make drug cost control a top priority for the coming Congress.
South Dakota’s Initiated Measure 21 would set a cap of 36 percent on short-term payday loan interest rates, which currently average an astounding 650 percent in the state. According to Public Citizen, corporate-backed opponents of this initiative have outspent supporters by 16-to-1. This predatory industry has also funded a competing measure (Constitutional Amendment U) that would cap rates at 18 percent, but with a huge loophole that would allow unlimited interest rates as long as the borrower agrees to the rate in writing. The industry’s proposal would place the provision in the state constitution, effectively tying the hands of state legislators to crack down on sky-high interest rates.
5. Limits on corporate rights and money in politics (California, Missouri, South Dakota, Washington)
Initiative 735 in Washington and Proposition 59 in California encourage each state’s congressional delegation to work to overturn Citizens United. These efforts keep the issue of big money in politics in the spotlight, but won’t do much to break through Washington gridlock.
In Missouri and South Dakota, voters have the opportunity to pass campaign finance initiatives with a bit more bite. Missouri’s Amendment 2 would place a hard limit on contributions for state and judicial candidates. In 1994, voters in that state overwhelming approved a similar ballot initiative, but a Republican governor and GOP-led legislature repealed it in 2008.
In South Dakota, initiated Measure 22 would establish a publicly funded campaign finance program and an ethics commission. This bold initiative is the work of Represent.Us a national anti-corruption group spawned in the wake ofCitizens United.
The 26 mostly southern states with so-called “right to work” laws that undercut labor unions tend to have lower wages, less health care coverage, and an overall lower quality of life. Nevertheless, ant-union ideologues want to see these laws cemented in their state’s constitutions with the Right to Work amendment in Virginia and Amendment 8 in Alabama.
Billionaires including Michael Bloomberg to the Walton family have pumped more than $11 million into Massachusetts in support of Question 2, an initiative to lift the cap on charter schools, which would take away up to $100 million in much-needed funding from public schools. Meanwhile Republican Georgia Governor Nathan Deal is supporting Amendment 1, an initiative that would allow that state to give absolute power over public schools to a hand-picked appointee and allow for-profit corporations to run Georgia’s education system.
Sarah Anderson directs the Global Economy Project at the Institute for Policy Studies and is a co-editor of Inequality.org.
Josh Hoxie directs the Project on Opportunity and Tax at the Institute for Policy Studies and co-edits Inequality.org.