Taxes

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.

Taxing Issues

The OK Policy Blog has an interesting post about bringing fairness to the Oklahoma tax system.

The blog, which is part of the Oklahoma Policy Institute, published a graph that shows how tax percentages decrease as people make more income. For example, those in Oklahoma making $12,000 or less annually pay 12 percent of their income in taxes while those making $250,00 or more annually only pay 8 percent.

According to the blog, OK Policy will soon launch OK Policy Online Guide to Oklahoma Budget and Taxes that deals with, among other issues, taxes. The blog argues:

As much as we argue about taxes, most of us don’t think poor people should pay more in taxes than rich, but that’s how we’ve set up the system in Oklahoma. The Guide does not make recommendations or demands, except to urge we get to work on the problem. It offers a range of options for consideration.

Those opposed to changing the system argue that high income earners pay more in taxes overall and that changing the system could hurt the state in efforts to attract highly-skilled and educated workers. But the bottom line is that the wealthy have all the money. The current wealth disparity in the country, which grew during former President George Bush’s years in office, is simply not sustainable. A small increase in taxes on the wealthiest Oklahomans makes sense, especially given the state’s budget problems.

The state’s tax system needs improvement. Check out the OK Policy Blog for its suggestions.

Corporate Media Shows True Colors

One of the great myths of our time, consistently regurgitated by the right-wing haters on talk radio, is that the media is inherently liberal. This is simply not true. The corporate media, first and foremost, serves its own corporate interests at any expense, including truth.

Take The Washington Post, for example. It recently fired its popular blogger Dan Froomkin, who wrote White House Watch for the newspaper. Froomkin was highly critical of the Bush administration and was considered “liberal” by some people. Yet he also criticized President Barack Obama's administration. Froomkin’s posts were about truth, about what is real, not ideology, and many times that meant he criticized the right-wing’s extreme agenda. But truth and holding politicians accountable are not a part of the establishment media these days.

Fortunately, Froomkin landed on his feet at the Huffington Post.

Meanwhile, word leaked out about some fancy dinners Post publisher Katherine Weymouth planned to have at her house. Lobbyists and trade associations would get the chance to mingle with Post staff and key political operatives for fees ranging up to $25,000. The dinner plans were canceled after an uproar about the basic ethics of the situation.

So let’s see. The Post fires it best, liberal commentator right around the time it offers up some “pay-to-play” access to lobbyists, and yet the right-wing howls about the liberal media.

The larger story, of course, is the general decline of the corporate media, and its predictable missteps as the world turns away from its biased, boring rhetorical frames that support the right-wing’s extreme agenda.