From Publisher to Plumber

In questioning the fairness of tax policy, The New Times’ Bill Brod may have found a new calling

The proposition before the assembly at the inaugural Campbell Institute debate held on Feb. 1 at the Everson Museum was straightforward: “This assembly would increase taxes on the wealthy.” A distinguished panel of economists, politicians and one ethical leader agreed to debate the question in the classical Oxford style. It was sponsored by the Campbell Public Affairs Institute at the Maxwell School of Syracuse University. 

Knowing that the panel included disgraced former Gov. Eliot Spitzer, the question in my mind was somewhat less lofty: “How does a guy who can afford $10,000 whores find himself defending the 99 percent?”

Instead the evening turned on a question raised by debate participant Kevin Hassett, director of economic policy at the right-wing American Enterprise Institute. Following a series of comments sparked by a question from Syracuse New Times publisher Bill Brod, a locally renowned conservative, Hassett decided to gamble by elevating Brod to Joe the Plumber status. 

“The bottom line is this,” Hassett told the crowd, “if you think that increasing taxes on Bill is good for Syracuse, then vote in the affirmative.” (The affirmative meaning that taxes on the wealthy should go up). Wow. 

Joe the Plumber, in case you don’t remember, came to some level of fame during the 2008 John McCain-Barack Obama presidential campaign when he was videotaped questioning Obama about his small-business tax policy. McCain and his running mate Sarah Palin adopted Joe the Plumber (a.k.a. Samuel Joseph Wurzelbacher, who at the time was not even a licensed unclogger of Ohio toilets) and exploited him as a metaphor for middle-class Americans.

How did it get to that point? Well, Spitzer and his colleagues, Leonard Burman, Moynihan chair of public affairs at Maxwell, and Jennifer Hamlin-Navias, a minister at May Memorial Unitarian Universalist Society, had been arguing that raising taxes on the wealthy was a moral as well as an economic imperative. 

After quoting from the Old Testament book of Leviticus, Hamlin-Navias asserted that “none of us has the right to acquire as much wealth as we can.” Burman, who has served in both the Treasury Department and the Congressional Budget Office, argued that federal taxes would have to increase unless we want to radically downsize government to 1950s levels (before the invention of the MRI). 

Spitzer paraphrased Winston Churchill when he said of our current economic divide, “Never have so few owed so much to so many.” The former governor said he would like to see the highest marginal tax rate return to the levels of the Clinton years, but for the sake of argument he was willing to settle for equalizing the tax rate on capital gains with the rate on personal income.

“Give me a flat tax,” said the man once known as the Sheriff of Wall Street. “Bring Mitt Romney up to the rest of us.”

Arguing for the negative alongside Hassett were Deb Warner, vice president for public policy at CenterState CEO, and state Sen. John DeFrancisco, chair of the Senate Finance Committee. Warner complained that income taxes were inherently unjust, and that they hurt the poorest most by reducing job opportunities. 

DeFrancisco (R-50th) insisted that New York state and the federal government both already have very progressive tax structures. “We do have a progressive income tax,” said the 20-year senator, “33 percent of New York state taxes are paid by people making over $1 million.” 

The senator further noted that the federal and state Earned Income Tax Credit helped level the fiscal playing field. Hassett attempted to seize the moral high ground by calling the defense of capitalism a “sacred” obligation.

During the question-answer session, Brod, seated in the center of the arena, asked why he, as a small-business owner employing 26 people, should invest in future growth of his company when the tax system, as he saw it, was killing his incentive to do so. Spitzer shook his head and tried to explain to the publisher that he was following all the wrong strategies. 

Burman repeated his assertion that the corporate tax structure was fatally flawed. “We have a whole industry dedicated to shifting burdens and avoiding taxes,” Burman noted. 

Hassett, who says the United States has the highest corporate tax rate in the world, agreed. It should be noted that both sides of this debate pretty much believe the corporate tax structure needs to be changed and corporate taxes lowered.

Then Spitzer proceeded to explain to Brod how he should go about restructuring his business to reduce his tax burden, suggesting that The New Times executive engage in exactly the behavior that Burman was disparaging. Displaying the same brilliant arrogance that made him New York’s most promising and shortest-lived chief executive, Spitzer scoffed and told Brod in front of the crowd, “I’ll give you the name of a good accountant; he worked for Mitt Romney.”

After the debate, Spitzer explained to me that he thought Brod was paying more in taxes than those who were better at gaming the system. “He pays corporate income taxes on what the business earns,” offered the former governor, now in the real estate business, “and then he pays personal income tax at a higher rate from what he draws out of the business. What those who game the system have learned to do is to account for more of what they take out as capital gains. Essentially, he {Brod} is subsidizing Mitt Romney.”

In the end the lively debate, featuring an all-white panel in front of a mostly-white audience, changed few minds. A poll taken before and after the debate reflected an audience biased nearly 5-to-1 in favor of soaking the rich. But one small-town publisher may have found himself a new calling, much like that famed plumber from the last presidential election cycle.                                           

Read Ed Griffin-Nolan’s award-winning commentary every week in the Syracuse New Times. You can contact him at edgriffin@twcny.rr.com.