|
WORD COUNT
699
MAY 7, 2008
WANT TO REDUCE YOUR
TAXES? GET RICH – by Holly Sklar
When it comes to
cutting taxes for the wealthy, President Bush can truly say, "Mission
accomplished." The richest 1 percent of Americans received about $491
billion in tax breaks between 2001 and 2008. That's nearly the same
amount as U.S. debt held by China -- $493 billion -- in the form of
Treasury securities.
Do you want our
government to mortgage more of our nation's future to finance tax breaks
for the rich? Tax cuts have already helped the wealthiest 1 percent --
whose annual incomes average about $1.5 million -- increase their share
of the nation's income to a
higher level than any
year since 1928 on the eve of the Great Depression.
Wall Street's five
biggest firms paid "a record $39 billion in bonuses for 2007, a year
when three of the companies suffered the worst quarterly losses in
their history" and are eliminating thousands of jobs as losses mount
from the subprime mortgage market collapse, reports Bloomberg.
The International
Monetary Fund says the United States is in the worst financial crisis
since the Great Depression. Yet, we are borrowing money with interest to
finance tax cuts for Wall Street executives.
For Americans below
the top 1 percent, the tax cuts have been a giant swindle. The bottom 99
percent of taxpayers were left with a bill of $3.74 in debt for every $1
in federal tax cuts from 2001 to 2006, reports Citizens for Tax Justice.
Only the top 1 percent came out ahead.
Meanwhile, the
federal budgets for environmental protection and housing for the elderly
have been slashed more than 20 percent since 2001, adjusted for
inflation, the Community Development Block Grant budget is down 32
percent, and the lack of health insurance is an epidemic. Most
households aren’t even earning as much as they did in 1999, adjusting
for inflation. But the 400 taxpayers with the highest incomes doubled
their incomes between 2002 and 2005.
According to the
latest IRS data, which excludes tax-exempt interest income from state
and local government bonds, the richest 400 taxpayers reported an
average $214 million each on their federal income tax returns in 2005 --
up from $104 million in 2002. As the Wall Street Journal observed, "It's
also important to remember that these figures don't represent wealth or
even lifetime earnings -- merely income for a single year."
Thanks to tax cuts,
it's now common for the nation's richest bosses to pay taxes at a lower
rate than workers. The 400 richest taxpayers paid only 18 percent of
their income in federal individual income taxes in 2005 --- down from 30
percent in 1995. "The drop in effective tax rates for the top 400
filers," the Center on Budget and Policy Priorities reports, "worked out
to a tax reduction of $25 million per filer in 2005." It would take 673
average workers earning $37,149 a year to reach $25 million today.
While tax cuts help
the superrich compete over who has the biggest submarine-carrying
superyacht, Katrina survivors are being hit with foreclosures, and
neglected levees and bridges around the country are a disaster waiting
to happen. Most of the provisions of the 2001 and 2003 tax cuts are
scheduled to expire at the end of 2010. President Bush wants to make
them permanent. The richest 1 percent of households would receive nearly
$1.2 trillion in tax cuts from 2009 through 2018, reports the Center on
Budget and Policy Priorities. How much is $1.2 trillion? More than all
the debt accumulated in the nearly 200 years from George Washington
through Ronald Reagan’s first two years in office. That's before adding
interest payments on the borrowed $1.2 trillion.
Tax cuts for the
wealthy fuel rising inequality along with rising debt and neglect.
Taxpayers with annual incomes above $1 million in fiscal year 2012, for
example, would increase their after-tax income by 7.5 percent thanks to
an average tax cut of $162,000. The poorest 20 percent of taxpayers
would get an average tax cut of $45 -- and decaying public services.
Democratic
presidential candidates Hillary Clinton and Barack Obama promise to end
the tax breaks for the wealthy. Republican candidate John McCain wants
to extend them. What do you want?
--
Holly Sklar is
co-author of "Raise the Floor: Wages and Policies That Work for All of
Us" and "A Just Minimum Wage: Good for Workers, Business and Our
Future."
_hsklar@aol.com --
Copyright 2008 Holly
Sklar.
# # # # #
|
