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Health Care & Environment
11.16 How pesticide bans can prevent tens of thousands of suicides a year [how many thousands more die early from eating pesticide-laced food?]
11.15 The long read: The plastic backlash: what's behind our sudden rage – and will it make a difference? [the world wants to throw-up...]
11.15 Claws out: crab fishermen sue 30 oil firms over climate change [workers are waking-up...]
11.12 This Land is Your Land: The Zinke effect: how the US interior department became a tool of industry [behaving ignorantly again...]
11.11 Trump responds to worst fires in California’s history by threatening to withhold federal aid [behaving ignorantly again...]
11.11 Interior department sued for ‘secretive process’ in at-risk species assessment [behaving ignorantly again...]
11.11 Keystone XL pipeline: judge rules government 'jumped the gun' and orders halt [behaving ignorantly again...]
News Media Matters
US Politics, Policy & 'Culture'
11.17 As Energy for Medicare for All Explodes, Steny Hoyer's Plan Includes Waiting for Trump to Help Make Obamacare Better [Another who is unfit to be Democrat leader]
11.17 'A Staggeringly Bad Idea': Outrage as Pelosi Pushes Tax Rule That Would 'Kneecap the Progressive Agenda' [Unfit to be Democrat leader]
11.16 As 'Green New Deal' Demand Grows, Democrats Have Choice: Confront and Defeat Fossil Fuel Industry or Take Credit for 'Doomed' Planet [Two choices: Save life-on-Earth or help Republicans let it die?]
11.15 Democrats Won Big. Can They Go Bold, Too? [it's about suppressing the influence and leadership by Republican-like Democrats who counsel 'íncremental' (no) change, such as Nancy Pelosi, Steny Hoyer, Hillary Clinton, Chuck Shumer and Joe Biden]
11.15 Pentagon Officials Forced to Make Fewer Public Appearances to Avoid Provoking Trump [...by revealing Trump's huuuge ignorance]
11.15 REPUBLICANS USED A BILL ABOUT WOLVES TO AVOID A VOTE ON YEMEN WAR [if there are 'defense industry' profits to be made—including congress-critter insider-trading—and political 'donations' to be had, we mustn't stop killing innocent civilians!]
11.14 The Guardian view on Yemen’s misery: the west is complicit [WAR CRIMES]
Economics, Crony Capitalism
11.16 Amazon’s HQ2 Will Get a Tax Break Designed to Help the Poor [a Republican program that directly helps participating wealthy companies—but only helps workers if and when 'trickle-down' occurs.]
11.16 Trump doesn’t want to punish Saudi Arabia over Khashoggi. His new sanctions prove it. [George W. Bush made a similar immoral decision for the same oily reasons after 9-11, protecting Saudi defense contracts while facilitating the slaughter of poorer Arab "terrorists" in the region.]
11.15 The Earth is in a death spiral. It will take radical action to save us [fossil fuel burning, un-recyclable plastic production/use and methane gas release must cease ASAP.]
International & Futurism
11.17 Thousands gather to block London bridges in climate rebellion [We're losing WWIII because the enemy is invisible while we're like frogs slowly cooking. We aren't informed enough to be alarmed, but must get organized and motivated to fight back. We need a War Plan to ruthlessly pursue the fight of our lives!]
11.17 Policies of China, Russia and Canada threaten 5C climate change, study finds [Climate catastrophe is increasingly likely without worldwide organization, funding and commitment to winning THE WAR AGAINST GLOBAL WARMING.]
11.15 Cuba to pull doctors out of Brazil after President-elect Bolsonaro comments [terms must be negotiated for fairness to Cuba's health professionals without disruption of healthcare for Brazil's poor]
11.14 'Appalling' Khashoggi audio shocked Saudi intelligence – Erdogan [Exposing a psychopath?]
Taxes in America: A Long Rightward Lurch
Tuesday, 5 October 2010
The super rich get more than half of their income from capital gains—which are taxed at only 15 percent.
Nothing raises the blood pressure of Tea Partiers faster than taxes. “Taxed Enough Already,” their signs shout. “Taxed alive and again when we’re dead,” they say.
That’s the Tea Party view, and it’s on view nonstop. The facts, though, point the other way. We’re living in a Golden Age of low federal taxes, especially for eye-popping incomes. It’s a great time to be a billionaire in America, or even a measly millionaire.
Warren Buffett, a multi-billionaire, revealed in 2006 that his tax bill was “far, far less as a fraction of my income than the secretaries or the clerks or anyone else in my office.” The numbers shamed him: “There’s class warfare, all right,” he said, “but it’s my class, the rich class, that’s making war, and we’re winning.”
What makes the Tea Party wrong and Buffett right? Several provisions slant the U.S. Tax Code heavily in favor of heavy earners. Taxes may be the bane of the Tea Party, but they’re a relative boon for America’s have-mosts. Let’s look at some of the ways the Code keeps Warren Buffett’s fortune in Warren Buffet’s hands—and even chips in, redistributing income upward.
The major contributor is the 15 percent levy on long-term capital gains and corporate dividends. The top 1 percent of U.S.households owns nearly 40 percent of all privately-held stock. The super rich get more than half of their income from capital gains. The current 15 percent rate on gains is at its lowest since FDR’s first term. For middle-class Americans, the rate on wages is 25 percent. Taxing income from wealth at little more than half the rate of income from work: it’s the perfect way to make sure that Warren Buffett (and all the Buffett wannabes) pay effective tax rates nowhere near what their incomes might suggest.
“How can this by fair?” Buffett asked. “How can this be right?”
The Code also sets marginal rates, which were gutted by President Reagan. He whacked taxes in 1981 and again in 1986, taking the top rate all the way down from 70 percent to 28 percent. He also sent the federal deficit soaring, which modest tax hikes later repaired—until, of course, a double dose of tax-cut elixir from President Bush.
Whose bread do the Bush tax cuts really butter? Dick Cheney knows, and he’s laughing all the way to the bank. Cheney, famously declaring that “deficits don’t matter,” cast the tie-breaking Senate vote adding dividends to the tax-cut bonanza.
Taxes turn progressive when rates rise along with income. Fewer brackets mean less progressivity, and Reagan cut the number of brackets from 15 to four. There are six today.
Fewer tax brackets, coupled with a low threshold for the top bracket, give high incomes another edge. Taxes turn progressive when rates rise along with income. Fewer brackets mean less progressivity, and Reagan cut the number of brackets from 15 to four. There are six today, with the top four at 25, 28, 33 and 35 percent—a narrow spread, easily offset by provisions like the capital gains rate. The top rate kicks in at about $400,000 of taxable income, which author and tax expert David Cay Johnston calls “bizarre.” It’s a long way, he points out, from $400,000 to $1 million, $5 million, $100 million and hedge-fund billions: “Why don’t we have higher rates for those incomes?”
The top rate kicks in at about $400,000 of taxable income—and stays there, no matter how much more you earn.
Even the bottom marginal rates help top earners. A millionaire, filing singly, pays the same 10 percent on the first $8,375 of taxable income as the working poor—and so on, up the income scale. As the Center on Budget and Policy Priorities notes, the real winners from extending Bush’s middle-class tax cuts wouldn’t be middle class: “In fact, a family making more than $1 million will receive more than five times the tax cut benefit, in dollar terms, as a middle-class family making $50,000 to $75,000...” (Italics in original.)
The Tax Code doesn’t overtly discriminate, but it’s hardwired to make every tax break worth more at the top.
The Tax Code is also loaded with deductions that effectively rain dollars down on the rich. The Code doesn’t overtly discriminate, but it’s hardwired to make every tax break worth more at the top. All deductions get written off at 35 percent, starting with personal exemptions and standard deductions. This alone trims $7,315 off the tax bill of a post-65 couple. The serious money goes to itemizers, with Uncle Sam picking up five-figure amounts for mortgage interest on pricy real estate.
President Obama once proposed capping the mortgage deduction at 25 percent, the middle class rate. His idea quickly died, attacked as class warfare. This summer, in a piece titled “The Class War We Need,” conservative columnist Ross Douthat was incensed to learn that the owners of McMansions were defaulting at twice the usual rate. “The rich are different from you and me,” he wrote. “They know how to game the system.”
They also know that Congress always stands ready to tilt the tax laws their way. When the market crashed in 2008, lawmakers rushed to pass a one-year suspension of required distributions from retirement accounts. Only the haves stood to gain. Those who actually needed the distributions had to take them and pay taxes. The haves took a pass and saved thousands. Back to Douthat: “In case after case, Washington’s web of subsidies and tax breaks effectively takes money from the middle class and hands it out to speculators and have-mores.”
It’s taken a fortune in lobbying, but America’s tax laws are bearing golden fruit. As even a conservative can see, they’re redistributing income to the top.
Gerald E. Scorse, who writes from New York City helped pass a bill that tightens the rules for reporting capital gains.
Mr. Scorse's stories are republished in the Baltimore Chronicle with permission of the author.
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Baltimore News Network, Inc., sponsor of this web site, is a nonprofit organization and does not make political endorsements. The opinions expressed in stories posted on this web site are the authors' own.This story was published on October 5, 2010.