ECONOMICS - LOOKING GLASS NEWS | |
Guess who's paying for dinner? |
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by Molly Ivins workingforchange Entered into the database on Thursday, June 09th, 2005 @ 12:01:32 MST |
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06.09.05 - AUSTIN, Texas -- David Cay Johnston, the invaluable New York Times
reporter who specializes in our tax system, has come up with some staggering figures
on what he calls "the hyper-rich," the wealthiest one-thousandth of
the population, and their taxes. "The share of the nation's income earned by those in this uppermost category
has more than doubled since 1980. ... The share of income earned by the rest
of the top 10 percent rose far less, and the share earned by the bottom 90 percent
fell." "Under the Bush tax cuts, the 400 taxpayers with the highest income --
a minimum of $87 million in 2000, the last year for which the government will
release such data -- now pay income, Medicare and Social Security taxes amounting
to virtually the same percentage of their incomes as people making $50,000 to
$75,000." "Those earning more than $10 million a year now pay a lesser share of
their income in these taxes than those making $100,000 to $200,000." "The alternative minimum tax, created 36 years ago to make sure the very
richest paid taxes, takes back a growing share of the Bush tax cuts over time
from the majority of families earning $75,000 to $1 million -- thousands and
even tens of thousands annually. Far fewer of the very wealthiest will be affected
by this tax." Under the Bush tax plan, by 2015, those making between $80,000 and $400,000
will be paying as much as 14 percent more of their incomes than those who are
hyper-rich. (All figures are from the Times.) According to Johnston, that group has grown by more than 400 percent since
1980, after adjusting for inflation, while the total numbers of households has
grown only 27 percent. This has nothing to do with envy -- Paris Hilton strikes
me more as a subject for pity, and I actually admire Bill Gates and George Soros.
It is about what is happening to this society. When the rules are increasingly
fixed to benefit only a few ridiculously wealthy people, that leaves guess who
with a larger portion of the tax tab. And we are talking serious money. In addition to paying the same percentage
of their income as those in the $50,000 to $75,000 range, the hyper-rich are
very good at finding ways -- both legal and illegal, observes Johnston -- of
sheltering a lot of income even from the taxes they are supposed to pay. The
Texas billionaires and Bush buddies Charles and Sam Wyly are now under investigation
by the IRS, SEC and Manhattan district attorney concerning a tax-shelter plan
run out of the Isle of Man, according to the Independent of Britain. Look, Medicare is being cut, Pell grants are way down, food stamps are being
cut -- every day we get news from Washington that some new measure hurting the
poor or the middle class has been put in place. At the same time, the country
is running up a monstrous debt that will be passed to our children. This is ruinous folly. This is not about class envy, it is about ridiculous,
unfair and harmful public policy. The Times has also been running a series on class in America. The bad news
is that social mobility in this country -- the old Horatio Alger idea that we
can get rich by working hard -- is less true now than it ever was. It turns
out the American dream of moving up is now more likely to occur in Britain and
France, those supposedly class-riddled countries. I suggest this has happened
in large part because our government now functions as a fully paid arm of the
wealthy and of corporate interests. The country is becoming internally calcified.
When Republican cuts to programs for veterans, troops, education or health
care come up, Rep. David Obey, D-Wisc., has regularly offered amendments to
restore funding and pay for it by reducing (not eliminating) the Bush tax cuts
to the hyper-rich slightly. Every time, the Republicans vote to keep the tax
cuts for the millionaires and let the troops or education take the hit. What
Johnston's study shows is that the hyper-rich are now taking advantage of the
merely rich. So now what will the Republicans do? |