Budget Fix: Shut Down America’s Tax Dodging Industry

One of the single greatest threats to the American economy and our standing in the world is our failure to properly educate our kids and prepare them for the rest of their lives. Our education system is falling behind thanks to short-sighted partisans and corporate elites intent on slashing education funding to the marrow. Montana has slashed them again and it causes a lot of shortfalls. I have cousins in the education system and every year they have to prepare to lose their jobs or change schools or figure out how to cut any corner they can with their new LOWER budgets.

The Think Progress had a really good article on the billionaires trying to end the public education system with the voucher system. This is a good story, We need more reporting like this from Think Progress.
Meet the Billionaires:

ThinkProgress has prepared this report to expose this network and give Americans the knowledge they need to fight back against this assault on the nation’s public schools. Here are some of the top millionaires and their organizations waging war on our education system:

– Dick DeVos: The DeVos family has been active on education issues since the 1990′s. The son of billionaire Amway co-founder Richard DeVos, Sr., DeVos unsuccessfully ran for governor of the state of Michigan, spending $40 million, the most ever spent in a gubernatorial race in the state. In 2002, Dick DeVos sketched out a plan to undermine public education before the Heritage Foundation, explaining that education advocates should stop using the term “public schools” and instead call them “government schools.” He has poured millions of dollars into right-wing causes, including providing hundreds of thousands of dollars into seed money for numerous “school choice” groups, including Utah’s Parents for Choice in Education, which used its PAC money to elect pro-voucher politicians.

– Betsy DeVos: The wife of Dick DeVos, she also coincidentally happens to be the sister of Erik Prince, the leader of Xe, the mercenary outfit formerly known as Blackwater and is a former chair of the Republican Party of Michigan. Mrs. DeVos has been much more aggressive than her husband, pouring her millions into numerous voucher front groups across the country. She launched the pro-voucher group All Children Matter in 2003, which spent $7.6 million in its first year alone to impact state races related vouchers, winning 121 out of 181 races in which it intervened. All Children Matter was found breaking campaign finance laws in 2008, yet has still not paid its $5.2 million fine. She has founded and/or funded a vast network of voucher front groups, including Children First America, the Alliance for School Choice, Kids Hope USA, and the American Federation for Children.

- American Federation for Children (AFC): AFC made headlines recently when it brought together Govs. Scott Walker (R-WI) and Tom Corbett (R-PA) and former D.C. Schools Chancellor Michelle Rhee at a major school choice event in Washington, D.C. AFC is perhaps the most prominent of all the current voucher groups, having been founded in January 2010 by Betsy DeVos. Working together with its PAC of the same name and the 501c(3) organization also lead by DeVos, the Alliance for School Choice, it has served as a launching pad for school choice legislation across the country. AFC made its mark in Wisconsin by pouring thousands of dollars into the state legislative races, donating $40,000 in the service of successfully electing voucher advocate Rep. Kathy Bernier (R) and donating similar amounts to elect Reps. Andre Jacque (R), John Klenke (R), Tom Larson (R), Howard Marklein (R), Erik Severson (R), and Travis Tranel (R). DeVos front group All Children Matter also donated thousands to many of these same voucher advocates. Altogether, AFC spent $820,000 in Wisconsin during the last election, making it the 7th-largest single PAC spender during the election (behind several other mostly right-wing groups with similar agendas).

- Alliance for School Choice (ASC): The Alliance for School Choice is another DeVos front group founded to promote vouchers and serves as the education arm of AFC. In 2008, the last date available for its financial disclosures, its total assets amounted to $5,467,064. DeVos used the organization not only for direct spending into propaganda campaigns, but to give grants to organizations with benign-sounding names so that they could push the radical school choice agenda. For example, in 2008 the organization gave $530,000 grant to the “Black Alliance for Educational Options” in Washington, D.C. and a $433,736 grant to the “Florida School Choice Fund.” This allowed DeVos to promote her causes without necessarily revealing her role. But it isn’t just the DeVos family that’s siphoning money into the Alliance for School Choice and its many front group patrons. Among its other wealthy funders include the Jaquelin Hume Foundation (which gave $75,000 in 2008 and $100,000 in 2006), the brainchild of one of an ultra-wealthy California businessman who brought Ronald Reagan to power, the powerful Wal Mart Foundation (which gave $100,000 in 2005, the Chase Foundation of Virginia (which gave $9,000 in 2007, 2008, and the same amount in 2009), which funds over “supports fifty nonprofit libertarian/conservative public policy research organizations,” and hosts investment banker Derwood Chase, Jr. as a trustee, the infamous oil billionaire-driven Charles Koch Foundation ($10,000 in 2005), and the powerful Wal Mart family’s Walton Family Foundation (more than $3 million over 2004-2005).

- Bill and Susan Oberndorf: This Oberndorfs use their fortune, gained from Bill’s position as the managing director of the investment firm SPO Partners, to funnel money to a wide variety of school choice and corporate education reform groups. In 2009, their Bill and Susan Oberndorf Foundation gave $376,793 to AFC, $5,000 to the Center for Education Reform, and $50,000 to the Brighter Choice Foundation. Additionally, Bill Oberndorf gave half a million dollars to the school choice front group All Children Matter between 2005 and 2007. At a recent education panel, Bill Oberndorf was credited with giving “tens of millions” of dollars of his personal wealth to the school choice movement, and said that the passage of the Indiana voucher law was the “gold standard” for what should be done across America.

- The Walton Family Foundation (WFF):The Wal Mart-backed WFF is one of the most powerful foundations in the country, having made investments in 2009 totaling over $378 million. In addition to financing a number of privately-managed charter schools itself, the foundation showered ASC with millions of dollars in 2009. It also gave over a million dollars to the New York-based Brighter Choice Foundation, half a million dollars to the Florida School Choice Fund, $105,000 to the Foundation for Educational Choice, $774,512 to the Friends of Educational Choice, $400,000 to School Choice Ohio, and gave $50,000 to the Piton Foundation to promote a media campaign around the Colorado School Choice website — all in 2009 alone. WFF’s push for expanding private school education and undermining traditional public schools was best summed up by John Walton’s words in an interview in 2000. An interviewer asked him, “Do you think there’s money to be made in education?” Walton replied, “Absolutely. I think it will offer a reasonable return for investors.” (He also did vigorously argue in the same interview that he does not want to abolish public education).
The wealthy families and powerful corporate-backed foundations presented here are just a sampling of some of the forces currently taking aim at public education. By demonizing traditional public schools and the teachers that staff them, this corporate education movement is undermining a very basic aspect of our democracy: a public commons that provides true opportunity for all, no matter what their background or socioeconomic status.

While the goals of the figures in this movement are varied, their assault on our public education system is one and the same. Joseph Bast, the president and CEO of the Heartland Institute, explained his own thinking about vouchers once, saying, “The complete privatization of schooling might be desirable, but this objective is politically impossible for the time being. Vouchers are a type of reform that is possible now, and would put us on the path to further privatization.” It’s up to Americans to protect their schools, teachers, kids, and communities from that fate.

This is what is behind all these privatizations programs, people with so much money, because they haven’t been paying taxes for years, who are looking for investment opportunities. They are forcing the privatization of as many government functions as they can simply because they have so much money and most other productive investments have moved overseas. These billionaires have several investment choices: they can invest their money in other countries which many are doing, they can finance our own national debt, which Robert Reich notes at Alternet is now 40 percent financed by wealthy Americans, or they can force the privatization of government services such as prisons, Social Security, education, police and fire fighting services and invest in those and start providing those to the taxpayers for a fee. In this particularly insidious case they are being paid by middle class taxpayers as part of their privatization scheme while lowering the quality of education and driving down the wages and benefits of educators.

The reason they have all this money and can basically declare war on the American way of doing things is because they haven’t been paying any substantive taxes for about 30 years now, they have amassed huge amounts of capital and they need someplace to spend/invest it. Since they have been paying less and less in taxes, the government has been starved of income at all levels and they have been able to use their money to buy their way into all kinds of deals in numerous states where they have basically simply paid to play. At some point the voters have to wake up and take a stand against this. But it might already be too late!

This is also why Republicans are ultimately ambiguous about cutting the national debt. One of the arguments that Bush made during his the early days of his tax cut campaign was that Clinton’s debt reduction plan would reduce the debt too quickly and this would be bad for the economy. Currently the Republicans and their banking friends own 40% of the debt which means they stand to collect at least 40% of the over $400 billion in interest that will be paid on that debt. It it were paid down too fact they would lose some of that nearly $200 billion that they stand to collect from the taxpayer. The owners of that debt really don’t want to lose that income, so while some Republican supporters want to purchase as much of the government owned properties and services as they can, other Republicans don’t want to really the debt to be paid down. This is why we keep hearing about ending social programs and meaningless cuts like NPR but we don’t see anything meaningful like military spending or cuts to Homeland Security being proposed.

In the end the Republicans are balancing these different forces while increasingly transferring all costs of government from the rich to the middle classes. That is their real project. Protect the “have mores” from any share of the cost of government. And continue to transfer productive capital investment offshore where car companies like General Motors can pay Indian assembly line workers from $.47 to $.85 an hour. Meanwhile, convincing the American voters that the reason they are moving offshore is too much regulation!

The Waltons, Coors, DeVos, Kochs, Prince’s and others are trying to get their hands on the few dollars they don’t have. We are seeing it with their overreach in the states, the push to privatize social security, (which would make the market jump for a while, thus increasing the wealth of the ultra wealthy), and the push to privatize Medicare.

These people do not care about this country, they are simply following wherever the money is.

I read Robert Reich, also. He has a lot of very insightful views on what is happening. Along with his postings on Alternet, and TV interviews, he has a blog. http://robertreich.org/

The lowering of the tax rates on business, has caused people to take their money out of their businesses, to invest in other things, thus causing the bubbles. With the lower tax rate, have come large deficits, and lack of services. These cuts have made the nation unsafe in many ways. People die when there are not services, the infrastructure is crumbling, and people are unable to find jobs where they can support themselves.

With these man-made crises has come an opportunity for the right wing to claim that the regulations that keep this country safe cause a lack of jobs. The job situation in this country has gotten so bad because our tax code encourages outsourcing, by rewarding the people who outsource.