Taxes and Misinformation
Today I became incensed at a conservative pundit railing against high taxes in the US. A caller suggested taxing the rich more to help cover our governments He claims that taxes are hurting business, and making the US less competitive internationally.
The thing is, the caller wasn't talking about raising taxes on businesses, he was talking about raising taxes on the rich. But conservative spin is not the only fallacy in this debate I think the problem is the way both sides are framing this issue.
Corporations are not inherently bad. If we didn't have big corporations, many people wouldn't have the jobs they provide (my dad works for a big corporation!) and many of the products and services we enjoy and rely on every day would not exist. By framing them as big evil corporations, we really discount all the good they do for us. With that said, corporations are clearly not people, if they were people we would call them short-sighted sociopaths. In the end their only goals are to make as much money as possible over the next 2-3 years in order to meet the approval of their stock holders.
What do corporations do with the funds they raise as profit? They pay their employees, they hire new ones, they innovate new products, they spend money on marketing and other services (creating more jobs) and they buy new equipment. There's nothing wrong with these things! They are all a net benefit to our economy and the people of our nation.
The trouble lies in how they partition these funds. At this particular time in history, they are spending a disproportionately large amount of this money paying the exorbitant salaries of their upper echelon employees. Check out this Mother Jones article: "Its the Inequity, Stupid" It explains it pretty well. It is not Walmart, Google or Apple that are the problem here, it is the extravagantly rich people who run these corporations that are creating and perpetuating this equity gap in the US. So the other problem with this conservative radio guests argument is that it falsely states what holds these corporations back. Most large corporations spend considerably more compensating their top tiered employees than they spend on federal taxes.
So my first proposal is: we don't raise taxes on corporation, in fact, we might want to LOWER corporate tax rates. Certainly we should cut tax loopholes so that everyone is paying "their fair share". But lowering corporate tax rates will indeed make them "more competitive in a global marketplace"? Less taxes means they have more money to spend, which does benefit our economy as a whole.
So my second proposal is: a dramatical increase in income tax for our wealthiest citizens. First, cancel the Bush era tax cuts, then raise those rates on the super rich even more. I'm talking a 60% income tax for people who make over $1M... something obscene like that. Lets face it, no one needs that much money (though they will whine and complain about the expenses involved in maintaining 7 houses). About 1% of Americans make this much money, and yet they count for over 1/3rd of all the income received by individuals. That's a whole lot of money being spent on yachts, luxury cars and caviar which would be better spent providing education, basic health care and other services for the bottom 90% of Americans, who bring in an average of $31,000 a year per household.
Furthermore, by putting this bid disincentive on high corporate salaries, I would like to think that corporate officials would start to see the benefits of putting the companies income towards more productive uses then just lining their own pockets, like reinvesting in equipment and infrastructure so their corporations can be "competitive in a global market" and maybe paying their lowest level employees a living wage.
The thing is, the caller wasn't talking about raising taxes on businesses, he was talking about raising taxes on the rich. But conservative spin is not the only fallacy in this debate I think the problem is the way both sides are framing this issue.
Corporations are not inherently bad. If we didn't have big corporations, many people wouldn't have the jobs they provide (my dad works for a big corporation!) and many of the products and services we enjoy and rely on every day would not exist. By framing them as big evil corporations, we really discount all the good they do for us. With that said, corporations are clearly not people, if they were people we would call them short-sighted sociopaths. In the end their only goals are to make as much money as possible over the next 2-3 years in order to meet the approval of their stock holders.
What do corporations do with the funds they raise as profit? They pay their employees, they hire new ones, they innovate new products, they spend money on marketing and other services (creating more jobs) and they buy new equipment. There's nothing wrong with these things! They are all a net benefit to our economy and the people of our nation.
The trouble lies in how they partition these funds. At this particular time in history, they are spending a disproportionately large amount of this money paying the exorbitant salaries of their upper echelon employees. Check out this Mother Jones article: "Its the Inequity, Stupid" It explains it pretty well. It is not Walmart, Google or Apple that are the problem here, it is the extravagantly rich people who run these corporations that are creating and perpetuating this equity gap in the US. So the other problem with this conservative radio guests argument is that it falsely states what holds these corporations back. Most large corporations spend considerably more compensating their top tiered employees than they spend on federal taxes.
So my first proposal is: we don't raise taxes on corporation, in fact, we might want to LOWER corporate tax rates. Certainly we should cut tax loopholes so that everyone is paying "their fair share". But lowering corporate tax rates will indeed make them "more competitive in a global marketplace"? Less taxes means they have more money to spend, which does benefit our economy as a whole.
So my second proposal is: a dramatical increase in income tax for our wealthiest citizens. First, cancel the Bush era tax cuts, then raise those rates on the super rich even more. I'm talking a 60% income tax for people who make over $1M... something obscene like that. Lets face it, no one needs that much money (though they will whine and complain about the expenses involved in maintaining 7 houses). About 1% of Americans make this much money, and yet they count for over 1/3rd of all the income received by individuals. That's a whole lot of money being spent on yachts, luxury cars and caviar which would be better spent providing education, basic health care and other services for the bottom 90% of Americans, who bring in an average of $31,000 a year per household.
Furthermore, by putting this bid disincentive on high corporate salaries, I would like to think that corporate officials would start to see the benefits of putting the companies income towards more productive uses then just lining their own pockets, like reinvesting in equipment and infrastructure so their corporations can be "competitive in a global market" and maybe paying their lowest level employees a living wage.