Forget The Rich: Tax The Poor And Middle Class
Nothing is certain but death and taxes, it used to be said, but in the madcap times we live in, even they’re up for grabs.
No matter what proof the White House provides that Osama bin Laden indeed has had his bucket kicked — and at this point even al Qaeda admits he’s dead — there still will be uncertainty. Whether they ever release those damned photos or not, a lunatic few will continue to insist that Osama’s alive and well and running a Papa John’s Pizza in Marrakesh.
As for taxes, having to pay them is no longer a sure thing either, especially if you’re a corporate giant like General Electric, with a thousand employees in its tax department, skilled in creative accounting. You’ll recall recent reports that although GE made profits last year of $5.1 billion in the United States and $14.2 billion worldwide they would pay not a penny of federal income tax. Chalk it up to billions of dollars of losses at GE Capital during the financial meltdown and a government tax break that allows companies to avoid paying US taxes on profits made overseas while “actively financing” different kinds of deals.
It gets worse. In 2009, Exxon-Mobil didn’t pay any taxes either, and last year, they had worldwide profits of $30.46 billion. Neither did Bank of America or Chevron or Boeing. According to a report last week from the office of the New York City Public Advocate, in 2009, the five companies, including GE, received a total of $3.7 billion in federal tax benefits.
As The New York Times‘ David Kocieniewski reported in March, “Although the top corporate tax rate in the United States is 35 percent, one of the highest in the world, companies have been increasingly using a maze of shelters, tax credits and subsidies to pay far less… Such strategies, as well as changes in tax laws that encouraged some businesses and professionals to file as individuals, have pushed down the corporate share of the nation’s tax receipts — from 30 percent of all federal revenue in the mid-1950s to 6.6 percent in 2009.”
What’s greasing the wheels for these advantages is, hold on to your hats, cash. Over the last decade, according to the NYC public advocate’s report, those same five companies — GE, Exxon-Mobil, Bank of America, Chevron and Boeing — gave more than $43.1 million to political campaigns. During the 2009-2010 election cycle, the five spent a combined $7.86 million in campaign contributions, a 7 percent jump over their 2007-2008 political spending.
“These tax breaks were put in place to promote growth and create jobs, not bankroll the political causes of corporate executives,” Public Advocate Bill de Blasio said. “… No company that can afford to spend millions of dollars to influence our elections should be pleading poverty come tax time.”
And by the way, those campaign cash figures don’t even include all the money those companies funneled into the 2010 campaigns via trade associations and tax-exempt non-profits. Thanks to the Supreme Court Citizens United decision, we don’t know the numbers because, as per the court, the corporate biggies don’t have to tell us. Imagine them sticking out their tongues and wiggling their fingers in their ears and you have a pretty good idea of their official position on this.
Meanwhile, last week Republicans like Utah’s Orrin Hatch, ranking member of the US Senate Finance Committee, grabbed hold of an analysis by Congress’ nonpartisan Joint Committee on Taxation and wrestled it to the ground. The brief memorandum reported that in the 2009 tax year 51 percent of all American taxpayers had zero tax liability or received a refund. So why, the Republicans asked, are Democrats and others so mean, asking corporations and the rich to pay higher taxes when lots of other people — especially the poor and middle class — don’t pay taxes either?
Hatch told MSNBC, “Bastiat, the great economist of the past, said the place where you’ve got to get revenues has to come from the middle class. That’s the huge number of people that are there. So the system does need to be revamped… We have an unbalanced tax code that we’ve got to change.”
All of which flies in the face of reality. As Travis Waldron of the progressive ThinkProgress website explained, “The majority of Americans who do not pay federal income taxes don’t make enough money to qualify for even the lowest tax bracket, a problem made worse by the economic recession. That includes retired Americans, who don’t pay income taxes because they earn very little income, if they earn any at all.
“And while many low-income Americans don’t pay income taxes, they do pay taxes. Because of payroll and sales taxes — a large proportion of which are paid by low- and middle-income Americans — less than a quarter of the nation’s households don’t contribute to federal tax receipts — and the majority of the non-contributors are students, the elderly, or the unemployed.”
What’s more, ThinkProgress notes, “The top 400 taxpayers — who have more wealth than half of all Americans combined — are paying lower taxes than they have in a generation, as their tax responsibilities have slowly collapsed since the New Deal era.” In the meantime, “working families have been asked to pay more and more.”
So maybe death and taxes are no longer certain, but one thing remains as immutable as the hills. In the words of another golden oldie, there’s nothing surer — the rich get rich and the poor get poorer.
By: Michael Winship, CommonDreams.org, May 10, 2011
The Grand Delusion: Higher Taxes “Soak” The Rich
Squeezing, gouging, soaking, it’s all the same, and it’s all wrong. The richest Americans, we hear it said, pay most of the federal income taxes. That’s true. But since 1980 their AFTER-TAX SHARE of America’s income has TRIPLED. That’s a trillion dollars a year in extra income for the wealthiest 1%.
A trillion dollars is seven times more than the budget deficits of all 50 states combined.
A trillion dollars, if it hadn’t been redistributed to the rich, would provide an extra $10,000 a year for every family that has contributed to American productivity since 1980.
The defenders of unlimited wealth insist that the very rich have earned their money. But what does EARN mean? Does it mean that the million richest families worked harder than the other 99 million families for thirty years? Does it mean that one man can bet against the mortgage industry and make enough money to pay the salaries of 100,000 health care workers? Does it mean using American research and infrastructure and national security to build a corporation that pays zero federal income taxes?
Most of the fortunate 1% benefited from tax cuts, financial system de-regulation, ownership of 50% of the stock market, and a 15% capital gains tax. According to a study by the University of California, in 2008 only 19% of the income reported by the 13,480 individuals or families making over $10 million came from wages and salaries.
The very rich claim that their income growth stimulates the economy. But it hasn’t happened. Low-income earners spend a greater percentage of their overall income on consumption, but they have less purchasing power than they had thirty years ago.
What the very rich won’t admit is that they benefit the most from government-funded research, national security, infrastructure, property rights, and a financial industry tailored to their pleasure and profit.
Instead, they claim that anyone can be rich if only they work hard. Much of America wouldn’t know if this is true. They haven’t had a chance to work lately.
By: Paul Buchheit, CommonDreams.org, May 10, 2011
We Don’t Have A Spending Problem, We Have A Fraud Problem
Conservatives seem to have a knack for changing the subject whenever their backs are up against the wall. Over the last several weeks, there has been an orchestrated chorus by the House Republicans in particular to define the so-called “deficit problem” in terms of a wild spending binge by the federal government and the Obama administration. They seem to have easily forgotten who got us into this mess in the first place. That aside, everyone from Speaker John Boehner to Sen Mitch McConnell have been bellowing throughout the halls of Congress and at every available microphone that “We don’t have a revenue problem, we have a spending problem”.
It’s amazing how we all have bought into this line. The media, in its usual rush to get a headline or sound bite, immediately picked up this line and has been the waterboys for the GOP by enabling this hoax on the American people. The focus in most circles has been on spending cuts. Well, we need to re-characterize what is actually going on here. We don’t have a spending problem..we have a fraud problem.
This fraud has been played on the American people by an ideologically depraved Republican party for at least the last ten years. They have made everybody believe that if we just make the wealthy wealthier, somewhere down the road, we will all benefit. There would be job creation with full employment, small businesses would thrive, home prices would fall, gas would cost less than two dollars a gallon and there would be a chicken in every pot. And we believed it hook, line and sinker. Now we are back to square one. None of these things have happened except the fact that we have indeed made the wealthy wealthier. In 2010, the 400 Americans with the highest adjusted gross revenue incomes averaged $345 million. The average federal income tax was 17%, down from 26% in 1992. The income gap just keeps getting wider. Why does this continue to happen? Because we let it happen.
Just last week, Standard and Poor’s accentuated the Republican clarion that the sky is falling. This call comes from the same S&P who supported every toxic waste subprime security under the sky, the same S&P who sold its ratings to the highest bidder. Regulators have also assisted the GOP in their fraud. The Office of the Currency has gone out of its way to protect its clients, ie the banks. Efforts to reign in the banks and stop their predatory loan practices have been foiled at every turn. Even the banks are too big to fail. Profits for banks, corporations, CEO’s, Wall St and the wealthy just keep soaring. There is a lot of back scratching going on here, by and for a lot of wealthy people.
Now that the cat is out of the bag, all of these wealthy people are trying to figure out a way to take the spot light off themselves. They are beginning to see that they may not be able to stave off demands any longer that they pay their fare share. People who have been adversely affected for so many years are now demanding that this fraud be stopped. Teachers and other low wage earners, the poor, seniors, students and union members have all come to believe that they have sacrificed enough. Even some tea party members are beginning to see the light.
For too many years, the Republicans and their wealthy friends have had their hands in everybody’s pockets. Your pocket was the revenue stream for them. General Electric and the Koch Brothers were probably happier than anyone. The Republicans were also happy because their happy friends provided the cover that allows them to do whatever they want to in terms of policy. Being the ideologues that they are, this protection gives them unimpeded opportunity to push forward with their agenda, from dissolving women’s rights, overturning the Affordable Care Act, union busting, replacing Medicare with vouchers and completely eliminating any sense of environmental protection just to name a few. With happy and contented wealthy backers behind you for so many years, how could you go wrong. My, how things are changing.
The revenue stream that the Republicans have depended on for so long is now drying up…that stream is you. They are finding that when they put their hands in your pockets now, they are feeling the seam of the sewn pocket. There just isn’t any more money there. They become flushed and filled with extreme panic, finally realizing that they are going to have their taxes raised after all these years. Their backs are against the wall. So what do they do now? Change the debate..”Let’s raise taxes on everybody”. Nice try!
It’s well past time that shared sacrifice mean exactly what it says. It is no longer acceptable that the poor, under privileged, seniors and the disenfranchised continue to carry the load for corporations, Wall St and their deadbeat tax-evading friends. No, let’s not raise taxes on everybody. Let’s end the fraud and insist that the wealthy start paying taxes just like everyone else. This being Easter Sunday, this may be a good symbolic time to increase taxes only for the rich. We should leave that rate in place for oh say, the next 40 years. Besides, they have accumulated a fair amount of wealth over the years and should easily be able to live off that profit during that time. Perhaps take a trip or two or just wander around the world enjoying their spoils. We will pledge to re-visit this issue after that time. If, and only if, the middle class has reached a level playing field, then we can talk about lowering the tax rate for the wealthy. I think Moses and the Pharaoh’s would be happy with this compromise. So it is written, so let it be done.
By: raemd95, mykeystrokes.com, April 24, 2011
Insuring The Elderly, Insuring The Poor
Democrats, Republicans and Independents all believe the government is responsible for providing health care to the elderly. Democrats and independents, but not Republicans, believe the government should also provide health care to the poor:
All groups are more likely to favor guaranteed health care for the elderly than for the poor. But the dropoff between the two policies is very different. Democrats by a plus 77% margin favor covering the elderly, but only favor covering the poor by a 52% margin. That’s a 25 percentage point gap between covering the elderly and covering the poor. For independents, the falloff is a very similar 28 percentage points. For Republicans, the falloff is 61 percentage points, from a +15 point margin for covering the elderly to a -46 point margin for covering the poor.
The best way to understand this is by grasping the link between ethnocentrism and support for universal entitlements and both opposition to means-tested entitlements. Ethnocentric attitudes among whites, controlling for all other beliefs, correlate with support for universal programs and with opposition to programs for the poor. White racial conservatives favor programs that benefit people like them — and hey, everybody gets old — and oppose programs for people unlike them — the poor being disproportionately non-white, and even more proportionately so in the white imagination.
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