By Dan Freilich
We Americans are at each other’s throats because we’re fighting over scraps, like what occurs in underdeveloped countries with severe wealth inequality. Basically, our national wealth is being amassed and horded by the ultra-rich and corporations, neither of which pays their fair share of taxes anymore. There’s little revenue for critical public good projects to help working and middle class Americans better their lives who ironically are the ones actually shouldering the burden of funding the government. Economic stress is instigating political and social stress. The most unfortunate part of all this is that pain being afflicted on working and middle class Americans is unnecessary as our national wealth is sufficient
Key points? That a one-two-punch of the ultra-rich getting most new income yet paying less in taxes is the basic cause of staggering wealth inequality. It is complicated but this summation is fair.
Tax progressivity was a bipartisan consensus in the 20th century as evidenced by the highest marginal income tax rate being over 90% under President Eisenhower and over 70% under President Nixon. Enactment of tax loopholes for the ultra-rich subsequently led to lower effective tax rates for them than for the middle class. This is not equitable.
Corporations benefit from the American system (e.g., military, SEC, research) and thus they must pay their fair share to support it; this was also a bipartisan consensus. Although our statutory corporate tax rate has been high, effective corporate tax rates have been relatively low; many corporations pay no taxes and some have negative tax rates (e.g., General Electric).
What overriding policy solutions are possible? First, we can work on diminishing unnecessary exorbitant salaries at nonprofit institutions. A good example would be the nurses:executives pay battle at UVM Medical Center. As a career federal employee, I know that obscene financial remuneration is not the only way to attract the best and the brightest. Second, we should work to enact massive tax hikes on the ultra-rich and tax-evading corporations who have accumulated huge tax burden debts due to low tax payments for decades – this is where I plan to focus if elected.
