Those Poor Rich People And Their Taxes

The top tax rate in the United States for the rich and for corporations is currently 35%. And if you listen to the Republican politicians, you would think this poses an unbearable burden on the rich and corporate America. After all, that means if a person earned $10 million, after taxes they would be left with a piddling $6.5 million.

But there are a few things they leave out of this equation. While the top rate may be 35%, almost no one actually pays that (even though that 35% rate is the lowest rate since World War II). Many corporations pay nothing at all, and most others find enough deductions to pay far less than that.

And the same is true of the super-rich. They don't pay anywhere near the 35%. In fact, the average tax paid for the rich is only about 17% (less than many middle-class earners must pay). Why is this? Two reasons -- deductions and capital gains. The rich have more deductions, thanks to tax loopholes, than any other group. And capital gains (income earned from things like stocks and bonds) are taxed at a rate of only 15% -- far less than the rate for earned income (income that actually had to be worked for).

But the right-wingers will come back with the argument that the rich pay most of the taxes in this country since 45% of families will owe no income tax this year. A couple of points need to be made here. First, that 45% would love to make enough money to pay taxes, but the right-wing Republican policies of the last 30 years have depressed their wages while funneling ever larger amounts of money into the hands of the super rich. Shouldn't the people who make the most also pay the most?

Second, that means that 55% of families do pay taxes -- and most of those people are not rich. They are middle class and they pay a larger tax rate than the rich many times (because most of what they make is taxed as earned income and not capital gains -- and they don't have the opportunity to hide large parts of their income in foreign countries to avoid paying taxes on it).

The rich (and the corporations) have been able to make a lot of money in this country, but they rarely pay their fair share of the taxes needed to keep the country going. And their Republican buddies want them to pay even less than they currently pay (and they're willing to abolish Medicare, privatize Social Security, and slash funds from education and social programs to do it).

The current tax system is not fair to the middle class in this country and the Republicans want to make it even more unfair. If anyone opposes this they accuse them of engaging in "class warfare". The fact is that there has been a "class warfare" going on in this country since the Reagan administration -- a war by the rich (through their Republican proxies) being waged on workers and the middle class. And the rich are winning this war.

To demand that the rich and the corporations pay their fair share of taxes is not declaring a war on the "upper class", it is the people defending themselves from the economic attacks being waged against them by the ultra-rich.

Others want to call it "income redistribution", like those were dirty words. They're not. Income is being distributed and redistributed all the time in every kind of economy -- including capitalist economies. Since the Reagan administration, the Republican policies have made sure that most money is redistributed from the vast majority of Americans to the tiny portion that comprise the super-rich. It is time to reverse this and make sure the distribution of income in this country is fair to all. That's not socialism -- it's common sense (and if it doesn't happen it will just lead to a real revolution one day -- a replay of what happened in 18th century France).

The Republicans and their rich friends are turning America into a third world country, where the rich own everything and everyone else serves them. That is a recipe for disaster, not a basis for a healthy economy.