FacebookTwitterRedditEmail

The Crisis on Withering Heights

Where is the revenue coming from to help reduce the tidal waves of red ink during the massive deficit spending by Washington to bolster Wall Street greed, stimulate the economy and rescue homeowners?

The scale of federal deficit is witnessed by the new frequency with which the dollar word “trillions” is used in the news media. An adjustment of major proportions is needed. It was only ten years ago when economists projected out the Clinton?s budgetary surpluses as “as far as the eye can see.” They were scurrying to figure out how this surprising surplus was going to affect the U.S. Treasury bond market. How quaint!

So, who is going to have to pay more into the Treasury? Not the oil and gas industry whose advertised protests against removing unjustified tax breaks are saturating the radio and television stations. Not the real estate or defense industries. Certainly not the financial industry.

How about the very wealthy? Well Barack Obama is letting George W. “red-ink” Bush?s tax cuts expire. So people earning over $250,000 a year will pay more. Mr. Obama plans to give 95% of the taxpayers some tax relief. Granted the Federal Reserve is printing money big time now, in order to spend it fast.

The right-wing, commercially-funded Think-Tank establishment wants tax cuts across the board. And the Cato Institute’s fellows are also defending foreign tax havens! But most corporatists still want an even bigger military budget which already devours fifty percent of the entire federal government?s discretionary budget. Their faith is that future economic growth will dissipate deficits whose purpose ironically is to promote growth

On Capitol Hill?better described as Withering Heights during the past decade?there is little interest or fortitude to confront the revenue question. Who or what can you tax more to make a difference on the massive deficits?

For starters, close the “tax gap” which is defined as the difference between taxes owed and taxes actually paid. This amount is estimated to be $290 billion every year by the IRS. Several thousand more IRS tax collectors will pay for themselves many times over and help preserve some public sense of fairness by those Americans who regularly do pay their taxes.

This figure of $290 billion does not include the huge tax shelters and offshore tax havens harboring trillions of dollars from U.S. corporations and very wealthy Americans who do not wish to share onshore tax responsibilities. Some members of Congress, notably Senator Byron Dorgan, want legislation to bring back some revenues from these tax escapees.

Another huge source of revenue, with very little if any fallout on the average taxpayer, would be a Wall Street sales tax on speculative derivatives (not stocks or bonds). With an estimated $500 trillion traded in such bets on bets or bets on debts last year, a 1/10th of 1% sales tax could bring in $500 billion yearly.

Consumers pay sales taxes in most states of 5 to 7 percent on necessities, while Wall Street?s casino gamblers buy trillions of dollars in derivatives and pay no sales tax. Unfair! Also such a transaction tax will help tamp down wild and destabilizing speculation, which has already pushed our economy to its knees.

A carbon tax would be another important source of revenue to keep the deficit lower and provide incentives to shift faster to energy efficiency and renewable energy such as various kinds of solar and geothermal.

There are other activities that our society as a whole would rather see diminished that can be subjected to increasing taxes. These could include the addictive and gambling industries and anti-social behavior such as corporate crime and fraud. Note that companies do not hesitate imposing “penalties” on consumers for far lesser infractions of their private, one-sided, fine print credit card and other form contracts.

Of course another $300 billion could come to the Treasury if Congress just restored the tax rates on corporate profits that were paid in the relatively prosperous nineteen sixties.

Then there is the reasonable argument that if taxes on “unearned income” — that is dividends and capital gains on investments?should never be lower than the tax on “earned income” by human labor. Well, today, taxes on the former — capital gains and dividends?can be half the rate as income taxes on work. Bringing them closer together could raise more revenue or bring down worker taxes in the process.

With huge deficits coming on like fiscal tornados for future repayment, Congress and President Obama have to face the music and stop dodging the question as to when they are going to be paid for and by whom?

Otherwise bankrupt corporate capitalism may be on its way to bankrupting its savior: Washington socialism!

RALPH NADER is a consumer advocate and three-time presidential candidate.

 

More articles by:

Ralph Nader is a consumer advocate, lawyer and author of Only the Super-Rich Can Save Us! 

bernie-the-sandernistas-cover-344x550
February 18, 2020
John Pilger
Julian Assange Must be Freed, Not Betrayed
Peter Harrison
Religion is a Repeating Chapter in the History of Politics
Norman Solomon
The Escalating Class War Against Bernie Sanders
Conn Hallinan
Irish Elections and Unification
Dean Baker
We Shouldn’t Have to Beg Mark Zuckerberg to Respect Democracy
Sam Pizzigati
A Silicon Valley Life Lesson: Money That ‘Clumps’ Crushes
Arshad Khan
Minority Abuse: A Slice of Life in Modi’s India
Walden Bello
China’s Economy: Powerful But Vulernable
Nicolas J S Davies
Afghan Troops say Taliban are Brothers and War is “Not Really Our Fight.”
Nyla Ali Khan
The BJP is Not India, and Every Indian is Not a Modi-Devotee
Binoy Kampmark
Buying Elections: The Bloomberg Meme Campaign
Jonah Raskin
Here’s Hoping
Evaggelos Vallianatos
Herakles in the Age of Climate Chaos
Bob Topper
The Conscience of a Conservative
John W. Whitehead
We’re All in This Together
Gala Pin
Bodies in Freedom: a Barcelona Story
Laura Flanders
Democracy, Dictatorship and Bloomberg
James Chandler
Among Cruel Children
February 17, 2020
Sheldon Richman
Anti-BDS Laws Violate Our Freedom
John Horning
NEPA is Our National Defense System

Evelyn Leopold
How the UN’s Middle East Peace Plan Was Trounced by Its Own Members
Stephen Cooper
“Just Mercy” and Justice Don’t Exist in Alabama
Patrick Cockburn
Sinn Fein’s Victory is Ireland’s ‘Brexit Moment’ When Left-Out Voters Turn on the Elite
Ralph Nader
“Democratic Socialism” – Bring it on Corporate Socialists!
Phillip Doe
Every Day’s a Holiday for the Oil Business in Colorado
Binoy Kampmark
Fashion Fetishism, Surgical Masks and Coronavirus
Cesar Chelala
The Democrats’ New Chapter
Robert Koehler
The Wall: Separating Democracy From Voters
Peter Cohen
Time to Retire the “He Can’t Beat Trump” Trope
Sr. Kathleen Erickson
Lessons From Ministering on the Border
Alvaro Huerta
Another Five Lessons for Democrats to Defeat Trump in 2020
Wim Laven
Donald Trump’s Plan for America: Make it Ignorant
Christopher Brauchli
You Tube’s Trump Predicament
Steve Klinger
Trump Shoots Romney at Prayer Breakfast; GOP Shrugs
Elliot Sperber
Ode to the City Bus 
James Haught
Megachurch Mess
Weekend Edition
February 14, 2020
Friday - Sunday
Andrew Levine
Mayor Mike, Worse Than Mayor Pete
Bruce E. Levine
“Sublime Madness”: Anarchists, Psychiatric Survivors, Emma Goldman & Harriet Tubman
Jeffrey St. Clair
Roaming Charges: Leader of the Pack
Jennifer Matsui
The Doomsday Cuckoo Clock
Paul Street
Things Said in Confidence to 4000 Close Friends This Week
Jonathan Cook
Even With Corbyn Gone, Antisemitism Threats Will Keep Destroying the UK Labour Party
Thomas Klikauer
Cambridge Analytica: a Salesgirl’s Report
Joseph Natoli
Vichy Democrats vs. the Master Voice
David Rosen
Sanders vs. the Establishment Democrats: McGovern All Over Again?
FacebookTwitterRedditEmail