Our tax debate is more cramped than ever

November 24th, 2015 at 8:19 am

Hillary’s attacking Bernie for raising taxes on the middle class, which both suggests a serious constraint on a truly progressive policy agenda and may be necessary to get elected. Even while the firm is already as master tax avoider, Pfizer is inverting–moving its tax mailbox to Ireland while keeping its operations largely here (and thus using US infrastructure, education system, etc. without paying its fair share for them)–to further take down its tax rate.

It’s official: our federal tax system is a hot, revenue losing mess. How did we get into this cramped cul-de-sac of a tax debate and how do we get out of it? Over at Wapo.

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3 comments in reply to "Our tax debate is more cramped than ever"

  1. Bruce Webb says:

    In re Hillary she is falling into the same trap that has captured DLC/Third Way/Bill Clinton Dems from Day One (in 1982) that is by defining “Middle Class” as those people in the $100,000 to $250,000 household income cohort that may indeed by middle class in Westchester County and clinging by their fingernails to a middle class life style on either the Upper West of Upper East Side of Manhattan but whose income and indeed lifestyles are above those of even the bosses of everywhere else in America.

    The idea that people making 2-5 times the median household income in this country should be sheltered from even tiny increases in effective marginal rates while you can focus everything on those above $250k (and both Hillary and Obama and on occasion Bernie are guilty of this) just smacks in the face people who are faced with buying a house in Peoria on an income of $60,000.

    ;The whole thing is a sham. Dean Baker and Barkley Rosser and acolytes etc have made the counter case the this strand of neo-liberalism a million times: give the actual middle class and working class a fair slice of the productivity pie and we will gladly kick in a couple of bucks to fund the social contract. The idea that we have to pander to the lower six figure crowd by insisting that they don’t have skin in the game once we get done adjusting rates is foolish. For example Social Security can be rescued by asking everyone to pay about a $1 a week per year more. But this is gutted by gutless proposals to not only exempt current workers under the cap but to create a donut hole to $250 k.

    Dubya Bush made a funny(?) joke at one of those Washington dinners that his base was the “haves and the have mores”. But all too often the Clintons and friends just have as their base the “haves”. Sorry my friend, if you are in the six-digit salary range we want you buck a week to save Social Security and maybe a buck more to fund Hillary’s caregiver credit. Even in that means substituting a bottle of Two-Buck Chuck for your French Cabernet once a month.


  2. Theodora says:

    How did we get into this mess? Ever since Reagan first started the magical tax cut fairytale we have been told repeatedly by Republicans that tax cuts pay for themselves. That has never been even close to true as even some of Bush II’s top advisers have admitted.
    http://www.washingtonpost.com/wp-dyn/content/article/2007/11/30/AR2007113002190.html

    Yet Republicans have paid no price for spreading this expensive, budget busting lie and have been allowed by the “liberal” media and Democrats to be perceived as the fiscally responsible party. (The link above is a rare exception that criticizes Giuiliani for promoting this fairy tale but it did not even mention Saint Ronnie or all the other Republicans who had been selling this snake oil for decades.)
    It is no wonder public trust has been lost when the public has been lied to over and over.


  3. Smith says:

    You’re basically pointing out how Clinton is Republican light in many ways. There is a difference between means testing for college tuition and health care, and providing a universal benefit for which everyone contributes. Read ‘Age in the Welfare State’ by Julia Lynch to understand the consequences. There is a reason social security, medicare, and public education are successful, and Republicans keep wanting to privatize them, which would under fund them for those least able to afford making up the difference at the same time.

    In a similar vein, that the top 20% to 5%, $100,000 to $250,000 household income, might pay more taxes, one can’t resist a similar logic to take a swipe at EITC, which also attacks a robust tax base, and is equivalent to only $2.50/hour part of raising the minimum wage, in it’s entirety, except business pays for the minimum, not the tax payer.

    A caveat should be raised that those seeking to raise taxes should also be talking about cutting waste in government, and making sure increase bureaucracy doesn’t grow with new programs and burden everyone.

    Regarding income share. it’s a bit difficult just now to find the right data to compare apples to oranges (distinction between individual income and household income). In the age of Piketty, that shouldn’t be the case.

    There is a huge divide between raising taxes on households making between $100,000 and $250,000 dollars, and not.

    https://www.census.gov/hhes/www/income/data/historical/inequality/

    Why is my favorite chart missing from wikipedia article? (I bookmarked previously)
    https://en.wikipedia.org/wiki/File:Distribution_of_Annual_Household_Income_in_the_United_States_2012.png

    https://en.wikipedia.org/wiki/Household_income_in_the_United_States#Distribution_of_household_income

    http://data.worldbank.org/indicator/SI.DST.10TH.10
    http://data.worldbank.org/indicator/SI.DST.05TH.20

    http://www.nytimes.com/interactive/2012/01/15/business/one-percent-map.html


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