Taxes

I wonder what type of signs the local Tea Partiers will come up with for their next rally at the state Capitol now that this news is out:

From USA TODAY:

Amid complaints about high taxes and calls for a smaller government, Americans paid their lowest level of taxes last year since Harry Truman's presidency, a USA TODAY analysis of federal data found.

Some conservative political movements such as the "Tea Party" have criticized federal spending as being out of control. While spending is up, taxes have fallen to exceptionally low levels.

This doesn’t necessarily mean taxes will stay this low, but it’s important to note the Tea Party rhetoric ignores the fact that some of the stimulus funds paid for tax cuts. Why wouldn’t Tea Party members now want to pay that money back to the government? Isn’t it tainted with the stench of socialism? Wouldn’t that be consistent with their argument?

Sure, people can make an argument about the growing deficit, one started under former President George W. Bush, but this recent information, again, shows the Tea Party movement is really not a movement based on much of anything, except fear mongering, slippery slope arguments and, yes, racism. (This is not to imply every Tea Partier is a racist.)

The information also brings up this question again: Why are the Tea Partiers so angry? They’re paying the lowest taxes in 60 years. How could that possibly drive people to fits of anger as they label President Barack Obama a socialist?

I opposed the Wall Street bank bailouts, but they worked. Financial experts are predicting the U.S. will actually make a profit on its loans to the banking industry. Now General Motors, which also received a government bailout, is reporting profits and paying back government loans.

So, let’s see, the bailouts for private industry worked, the stimulus funds paid for tax cuts, the economy continues to improve and Americans are paying the lowest in taxes in decades, but for Tea Partiers this means the country is on the dark slide to socialism.

How long can the Tea Party movement get away with ignoring the basic reality on the ground and still attract new followers?

Maybe Democrats aren’t going to do as bad in the November elections as everyone is predicting right now.

Oklahoma’s middle-income families pay between nine and 10 percent of their overall income in taxes compared to the state’s wealthiest families, which pay only 5.5 percent, according to a new study.

According to the Oklahoma Policy Institute, which issued a statement about the study, some taxes fall “disproportionately” on low-income families.

The study found that the state's sales, excise and property taxes, which fall disproportionately on the lowest income families, are the primary cause of low- and middle- income households paying a higher proportion of their income in taxes. Overall, the report found that families with incomes under $50,000 pay between nine and 10 percent of their incomes in state and local taxes, while families with income over $400,000 pay just over 5.5 percent.

The Institute on Taxation and Economic Policy conducted the study. According to the study’s introduction:

The study’s main finding is that nearly every state and local tax system takes a much greater share of income from middle- and low-income families than from the wealthy. That is, when all state and local income, sales, excise and property taxes are added up, most state tax systems are regressive.

The study cited Oklahoma’s sales tax on groceries as one reason for its regressive tax structure.

The bottom line is that Oklahoma needs a fairer tax structure. Recent state income tax cuts have primarily benefited the state’s wealthiest families while middle- and low-income families—those making $50,000 or less—face stagnant wages, job losses and rising health care costs.

It’s unlikely the state’s Republican-dominated legislature, which also has many conservative Democrats, will make any significant changes to the state’s tax structure anytime soon. The state currently faces a major budget crisis, and it’s doubtful fairer taxation is a priority issue for the current legislative leadership.

The right-wingers on cable television and radio will be howling over today’s White House announcement that the nation’s ten-year budget deficit is now estimated at $9 trillion, but there are simple ways to fix the problem.

Here are two ways to address the deficit: Congress could raise taxes on the country’s most wealthiest citizens and corporations, and the government could immediately end the military occupations in Iraq and Afghanistan.

Of course, that won’t happen because the nation’s wealthiest citizens and defense contractors buy the type of political influence through campaign contributions denied to ordinary Americans. But it’s important to raise these issues even if the right-wing attack machine marginalizes the ideas through its own special theater of the nonsensical.

At least one poll shows Americans do think the wealthy should be taxed more, and Democrats have floated ideas about taxing the wealthy more to help pay for health care reform.

So this question bears repeating: Why in the world are tax hikes on the nation’s wealthiest citizens not a larger part of the national conversation during a time of economic distress?

Some financial experts argue that tax hikes can delay an economic recovery by preventing business expansion, but what about the millions upon millions of dollars in disposable income held by the wealthiest among us? Should these citizens—I’m speaking of multi-millionaires here—be allowed to essentially hoard money while most of us struggle with stagnant wages, high health care costs and unemployment? Wealth disparity is the problem, not the answer, to our economic problems. The country learned this lesson in the 1930s, but somehow forgot it in the 1980s under President Ronald Reagan.

Apparently, the country now has the greatest wealth disparity in its history, according to a report that looks at the numbers since 1913. This does not bode well for basic democracy.

A two or even three percent federal tax hike on, say, those earning $350,000 or more a year could help stabilize the budget. Maybe the hikes should be even higher, and the income level should be lowered to $300,000. Tax hikes on massive corporate profits above a certain threshold could be instituted as well without affecting small businesses. My numbers may be off here, but the point is we need an extended conversation about our taxation system that deals with real numbers and facts. What we don’t need is more right-wing, slippery-slope arguments that only serve the interests of the wealthy.

The failed military occupations in Iraq and Afghanistan speak for themselves. Every dollar spent and every life lost in these occupations are tragic wastes. Estimates vary, but as of April, 2009, the Iraq occupation had cost approximately $642 billion and the Afghanistan occupation had cost around $189 billion, according to a congressional report. These costs grow by the day and don’t take into account the extended medical treatment needed by wounded veterans.