And virtue is its own reward
By Jerome Page
WHEN LAST I WROTE, I noted the great bidding war in which GOP candidates for the presidency signaled to corporate America (and its overflowing campaign coffers) their determination that no one could or would do more to rid the country of the scourge of taxation. But surely no one has been more eloquent in that noble cause than Rep. Michele Bachmann of Minnesota. Her zeal - as she compares current taxation with the horrors of the Holocaust and fights to insure that her grandchildren know that she was not silent as this evil threatened the future of America - is one of the signal dramas of American politics today.
To have to bring the curtain down upon that heart-rending melodrama and reach back for some connection with reality may be insensitive, but it is obviously crucial.
Let us, then, take a brief journey through the corridors of the American economic system today, touching on but a few highlights.
According to a 2008 report of the Government Accounting Office, an examination of corporate tax returns between 1998 and 2005 found that an annual average of 1.3 million U.S. companies and 39,000 foreign companies doing business in the United States paid no income taxes, despite having a combined $2.5 trillion in revenue. Two out of every three U.S. corporations paid no federal income taxes from 1998 through 2005.
Highlights include the reports of the recent taxes of the giants - GE, Exxon, Bank of America and Citigroup, among a number of other household names - ranging from zero to negligible, which did not quite reflect their enormous profits or the huge salaries paid to their executives.
As reported by Northeastern University in June 2011, "Between the second quarter of 2009 and the fourth quarter of 2010, real national income in the U.S. increased by $528 billion. Over this six-quarter period, corporate profits captured 88 percent of the growth in real national income while aggregate wages and salaries accounted for only slightly more than 1 percent. ...The absence of any positive share of national income growth due to wages and salaries received by American workers during the current economic recovery is historically unprecedented."
Moreover, Pat Garofalo of Think Progress has noted that 32 corporations spent more on compensation for top executives in 2010 than they paid in income taxes.
I add the following from the Charlotte Observer Forum of July 6: "Despite a decade of Bush tax cut windfalls for the wealthy pushing income inequality to levels not seen since 1929, Republicans are calling for another $700 billion, 10-year payday for the richest Americans. So it should come as no surprise that as corporate profits reached an all-time record in the third quarter, leading voices in the Republican Party want their tax bill slashed, too."
The New York Times reported last November that happy days are indeed here again for corporate America: "American businesses earned profits at an annual rate of $1.659 trillion in the third quarter, according to a Commerce Department report. ... That is the highest figure recorded since the government began keeping track over 60 years ago, at least in nominal or noninflation-adjusted terms. Nevertheless, the leading lights of the Republican Party are calling for a rollback in corporate tax rates."
A set of charts compiled by Michael Linden, Seth Hanlon and Jordan Eizenga, and reported by the Associated Press on June 10 of this year, documents the reality that our citizens and corporations pay much less than they once did while taxes for the very wealthy have plunged in recent years. They note that tax revenue is at its lowest level since 1950, rates are historically low and taxes on large estates have virtually disappeared.
There is, in short, abundant testimony to the reality that a smaller and smaller proportion of Americans are enjoying a larger and larger share of the national income and wealth. Both the figures and disproportion of this great transfer of wealth upward are staggering.
It is illuminating to introduce here one of several elements of the Bachmann war upon taxation: her unhappiness with the unfairness of 47 percent of the population paying no income taxes. She demands that everyone pay something. It would be a rude shock for her to learn that when the various regressive taxes and fees for existence - gas taxes, sales taxes, licence fees, etc. - are totaled up, poor and lower-middle-class wage earners are, of course, paying vastly more in taxes relative to income than the wealthy.
We appear to be slowly fading away from agreement with Oliver Wendell Holmes's maxim that "Taxes are what we pay for civilized society," and toward the ringing declaration of one right-wing blogger that, "Wanting what someone else earned is pure greed." The latter would appear to provide a fitting epitaph to that ringing phrase, "and crown thy good with brotherhood," that we all sing - and used to mean - with such good heart.
A final observation that appears relevant to the economics of our day.
According to Matthew 19:24, it is easier for a camel to go through the eye of a needle than for a rich man to enter the kingdom of God.
Given the dedication of the right to our Christian heritage - and given also their dedication to the protection of accumulation, untrammeled by government regulation and unburdened by the onerous demands of taxation - how long before our forlorn wealthy offer financial succor to some creative entrepreneur in genetic manipulation to develop a way to shrink camels, and thus ease both pathways?
Jerome Page is a Benicia resident.
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