Timothy Noah has a great piece at The New Republic that gives a good little history lesson on taxes in the last 30 years and makes what I think is a solid case for hoping that right now the best tax reform would be to do nothing. Let gridlock do it’s thing and let all the tax cuts expire. We need to increase taxes, we need more revenue, no matter how many cuts we can make to spending. I won’t repeat all his arguments; it’s a short column, packed with info and speaks for itself. I’ll just say that I appreciate him bringing up things you’ll pretty much never ever hear on the network TV news, the cable TV news, the mainstream news magazines, or for the most part, even the best newspapers. Things like historic tax rates, and that when Reagan cut taxes in 1986 it was from a top rate of 50%, not the current 36%. And he gives a useful history on the number of tax brackets. I completely agree that we need more tax brackets, not fewer, particularly with the exceedingly outsized gap in wealth not just between the 99 and the one percent but between the one percent and the top 1/10th of a percent, and then the 400 Americans with as much wealth as the bottom half of the country. One other place, the most important place, you’ll never see the issues Noah raises discussed; the floor of the U.S. Congress. I agree with him that the best we can hope for is simply to have all the Bush tax cuts expire.Speaking of taxes: we are always hearing about the odious burden of corporate taxes destroying American business. At work here is the old adage that when you repeat a lie often enough it becomes the truth. Alan Grayson, the one term firebrand congressman from Florida who was ousted by the tea party in 2010 and is now fighting to win his seat back, sent an interesting email to his list. Again, this is stuff you won’t hear Brian Williams tell you.
Grayson, love him or hate him, and there are plenty who do both, at least looks at data and raises issues few others will touch. I hope he wins in November; we need him in congress. Using government data, he created this graph:
“I came up with this chart myself (hold your applause, please), after downloading the data from the White House’s website, here. Corporate income tax revenue has dropped all the way down from 7.2% of GNP at the end of World War II to only 1.2% last year.
Go to a different government website, do a little arithmetic, and you’ll find that corporate profits are now 12.7% of GNP. Some division then tells you that corporations are paying less than 10% of their income in taxes.”
To all the tea partiers and government haters out there who think they are paying too much in taxes, I just ask you, why aren’t you complaining that corporations are getting away with paying almost nothing in taxes? I know, I know, you hear over and over that we have one of the highest corporate tax rates in the world. Technically true, and there are so many loopholes that as far as corporate taxes actually collected, we have one of the lowest rates, and some of the largest corporations (i.e. Exxon, GE) pay little or no taxes at all. Government isn’t always perfect; far from it. And it is still not only our best, but really our only hope in working against corporate overreach and control. We need the right balance between government and business. For too long now, the balance has shifted far too much towards corporate control. And again, if that worked, we’d now have full employment, no pollution, etc. etc. Since we don’t have that, I suggest that the only way to get there is to have a better government. That won’t happen by itself, and we won’t get any help from the giant corporations, who really like the status quo where they pay little or no taxes and still get out the message that they pay way too much in taxes. Change will only happy when voters take their head out of the sand and look at the world around them.