Texas and Taxes
Posted: Tuesday, August 16, 2011
by Walter Rhett
Charleston Perlo
Rick Perry runs Texas as America’s largest work farm. His new jobs pay low wages, lack benefits or advancement, and follow the model of post-war Levittown. But his candidacy should not distract from the central, more compelling issue of economic and job growth: the need to raise taxes.
“No taxation without representation;” the cry of the founding fathers now stands on its head. Now the governing representatives simply proclaim, “no taxes.” The caveat in the fine print seems to be “except for the middle class.” The corollary adds, “no jobs, either.”
Yet we are on the verge of extending tax cuts that will not reduce the debt, deficit, or growth jobs.
The cuts protect the private wealth of the 1% of individuals who control 24.3% the nation's net income. Yet these tax cuts have marginal utility in creating jobs. They don't add anything to demand.
The argument for taking back $700 billion (the aggregate tax on incomes over $250,000) for schools, roads, health care, safety nets, defense, deficit reduction, and jobs is neither anti-rich or anti-jobs. It has been a principle of American democracy that people pay in proportion to their means.
We must maintain the fairness of that historic principle; the social value and political trust of the progressive tax. It is the first step in reducing the deficit and the debt, restoring confidence and growing jobs.
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Top-level comments on this article: (1 total)The 1% control 24.3% of the income and pay 40% of the taxes. Define "fair share", please.That's easy, Jack. That top 1% benefit far more from the things that those taxes pay for than the rest of us do. National defense, transportation, telecommunications and energy infrastructure, law enforcement, private property rights and protection, the postal system, etc. etc. etc. The rich all use a vastly disproportionate amount of these and in most cases would not have been able to earn their riches without them. Paying a disproportionate amount of taxes seems fair to me.Some day I hope to do the same.One other point: Buffett's $6.9 million paid in taxes will give him a higher percentage of agreegate taxes. But his bill was a lower percentage of his income. Those who are top earners will always paid a higher aggregate tax. But is it fair for them to pay a lower percentage of income then the thousands who collective earnings don't even equal the tax bills of higher earners? You are suggesting not fairness, but rewarding the affluent for their wealth, when their wealth is already their reward. Caveat: Buffet's ot hiring one either, so a tax break to him, and many others, is wasted when it comes to creating jobs.
Corporate taxes? On profits, not on income. Different category: they are taxed on what's left after expenses. Income taxes are paid before expenses.Easy! Use aggregate share. In his NYT op-ed, Warren Buffet points out his tax bill for last yr was $6.9 million--yet was only 17.4% of his income, lower than any of the 20 workers in his office! All studies show 80% of those who pay no income earn less than $30,000 a year, per capita. Even is we taxed them at 25%, reducing their income to $22,500, their aggregate share of federal income tax would be miniscule. The point is that all incomes are not equal. That's why the progressive tax has been a founding principle of American democracy, to prevent a monied class from rising to control the interests of the country over the welfare of the common good.
I live in the old South and saw road pavements literally stop at black neighborhoods, old school books from white schools recycled to black schools when white schools received the updated, newest editions. I saw sewer and water services restricted by race and class. The point of a progressive tax is to provide for the common good: Those with more are expected to do more. And services are equally applied to all. Also note: paved streets, new books, municipal water and sewer are not disincentives for anyone to work; their provision doesn't encourage sloth.
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