States and Cities Should Raise Property Taxes – It’s Progressive!

Economist Polly Cleveland argues that states and cities must raise property taxes on the wealthy to deal with the financial crisis, but even Democratic governors are afraid to do it. Polly joins Paul Jay on theAnalysis.news podcast. Transcript Paul Jay Hi, I'm Paul Jay, and welcome to theAnalysis.ne Economist Polly Cleveland argues that states and cities must raise property taxes on the wealthy to deal with the financial crisis, but even Democratic governors are afraid to do it. Polly joins Paul Jay on theAnalysis.news podcast. Transcript Paul Jay Hi, I'm Paul Jay, and welcome to theAnalysis.news podcast. Please don't forget there's a donate button at the top of the webpage. Economist Polly Cleveland wrote me a few weeks ago saying she thought my guests on economic issues were not paying enough attention to the need for more taxation of the wealthy and relying too much on the ability of the Fed to create money. So, I invited her on the show; so, here we go: Mary Polly Cleveland is an economist focusing on wealth distribution and a long-time activist for social justice. Her blog Econamici -- if I'm saying it right; pardon for the crappy Italian accent -- also appears on the Dollars & Sense website. She serves on the board of Dollars & Sense, and she's now an adjunct senior research scholar at Columbia University's School of International and Public Affairs. Thanks for joining me, Polly. Polly Cleveland Oh, you're welcome. I'm honored. Paul Jay Thanks. So, what was your reason for writing? You know, I've been doing quite a few economic interviews and people have been talking a lot about the big stimulus package and so on. And you were right, I thought, that we hadn't talked enough about the issue of taxation. There's sort of this feeling that the Fed can just create money, and because of the various factors, inflation doesn't seem to be much of an issue. So, why focus on taxation? So, pick it up from there and then we can talk about what kind of taxation you have in mind. Polly Cleveland Yes, the Fed is creating lots of money, money which will eventually cause liability for taxpayers, but we don't think about that at the moment because it's an emergency. However, the way the Fed spends that money also makes an enormous difference. And what the Fed has been doing and did in 2008 was to try to bail out the large banks and the large property owners. They are trying to prevent a collapse of the banking system, which would happen if it became widely known that the banks had a lot of bad investments on their balance sheets. Which, of course, is precisely what happens in a bubble. So, the Fed has been mostly trying to bail out the big banks. And what the big banks do when they get the money is they use it to buy back their stock. So, of course, there's no inflation because the money is not getting spent on buying goods and services. It's being used to bail out people with bad balance sheets. Paul Jay Not just banks, a lot of private corporations, too. Polly Cleveland Oh, yeah, and a lot of big banks and a lot of private corporations who have made a lot of bad investments. I mean,