IS AMERICA REALLY BROKE?

The answer is no…the people of America are and the REDESTRIBUTION OF WEALTH has already taken place.

While the corporations and the very wealthy have seen a significant decrease in their tax rates; the middle class has seen an increase. What that means is that the wealthy and the corporations are getting richer on the backs of middle class Americans and the sweat and toil of the poor.

Posted by Chuck Collins
April 4, 2011

We’re Not Broke: Congress -Here’s $400 Billion In New Annual Revenue

Posted by Chuck Collins on @ 2:26 am

Article printed from speakeasy: http://blogs.alternet.org/speakeasy

URL to article: http://blogs.alternet.org/speakeasy/2011/04/04/400-billion/

“Government must stop doling out ever-larger tax breaks to the superrich and vast corporations.

Have you heard? America is broke, according to many governors and lawmakers.

They’re calling for deep cuts in teacher pay, firing cops, slashing medical services for working-class kids, and scrapping other essential services to narrow state and federal budget deficits.

There’s a better and fairer way to tackle this situation. Government must stop doling out ever-larger tax breaks to the superrich and vast corporations.

Around the country, states and towns are gutting their budgets, undermining the quality of our lives.

“Our country is not really broke,” said Cynthia Carranza who directs a food pantry in Niles, Illinois. Carranza witnesses the growing number of hungry people at her food pantry door even as government support for her program is slashed. “We’re an incredibly rich and prosperous nation. But our wealth is skewed to a very few fortunate at the top. We’re not broken, just twisted.”

Our communities are enduring mammoth state and federal budget cuts because we have, in large part, failed to sufficiently tax America’s millionaires and billionaires or prevent aggressive tax avoidance by multinational companies. The rest of us are paying to pick up the slack.

Congress has blown holes in our tax code, losing hundreds of billions in revenue. Worse, lawmakers have averted their eyes as corporate lobbyists drill new tax loopholes and extract new corporate welfare subsidies.

How else can we explain how a profitable company like General Electric pays no taxes? Since 2006, General Electric has reported over $26 billion in profits, yet paid not one penny in U.S. taxes. It gets worse. They’ve actually received more than $4 billion in subsidies and corporate welfare.

GE isn’t alone. Other huge global companies such as Verizon, Boeing, ExxonMobil, and Bank of America also pay no taxes. These artful dodgers aggressively solicit government subsidies and use accounting tricks to move money to overseas tax havens like the Cayman Islands. They pretend to earn their profits offshore and then report their paper losses here in the United States–so they don’t have to pay the IRS a dime.

Wealthy individuals have also benefited from a half-century of tax reductions. If U.S. millionaires and billionaires paid taxes based on 1961 tax rules, we would have raised an additional $231 billion in federal revenue this year.

By reversing years of tax giveaways to America’s rich and the corporations that enrich them, Congress could raise trillions in revenue. We could fund the public structures that safeguard our families and our future.

There are four revenue raisers that Congress could institute tomorrow that would generate $400 billion a year–or $4 trillion over the next decade. Such programs would restore greater fairness to our tax system and reduce the extreme levels of inequality polarizing our society.

Congress could levy a modest financial transaction tax on the transfers of stock, currency, and speculative investments that do little to strengthen the real economy. This would generate $150 billion a year while exempting smaller investors.

Lawmakers could reduce corporate tax dodging by closing overseas tax havens and requiring companies to pay U.S. taxes on the profits they actually earn in this country. This could generate as much as $100 billion a year.

Congress could establish new top tax rates on households with annual incomes over $1 million, which could generate another $100 billion a year. Under our current tax system, a person earning $374,000 a year pays the same top tax rate as someone earning $10 million a year.

Lawmakers could institute a progressive estate tax on fortunes over $5 million, with higher rates on billionaire estates. That would generate $45 billion a year.

Taking all four of these straightforward steps could raise a total of approximately $400 billion per year.

Sure, some politicians would rather cut services for children and the mentally ill before they dare to propose tax hikes on millionaires and tax-dodging corporations. But that doesn’t mean we’re broke. It just means we need to get our priorities straight.

Originally Published in OtherWords.

Senior scholar at the Institute for Policy Studies where I direct the Program on Inequality and the Common Good (www.ips-dc.org/inequality). Co-founder of Wealth for the Common Good (www.wealthforcommongood.org). Co-author with Bill Gates Sr. of Wealth and Our Commonwealth: Why America Should Tax Accumulated Fortunes. Co-author with Mary Wright of The Moral Measure of the Economy.”

It is no secret that the current wars in Iraq and Afghanistan have cost America dearly in terms of life and treasure. We need to end those conflicts yesterday. But what we also need is to spend our money wisely when it comes to the military. Other than the obvious reduction in bases across the planet and the relinquishing of defense to those countries that are prosperous enough to do so rather than being their defenders and guardian angels; we also need to have the military begin to act responsibly. Why do I say that? Because there are far too many “exercises” and “war games” that serve no purpose whatsoever other than to entertain the generals that play it as one would tic-tac-toe.

The other issue is the wasteful use of ordinance; when we shoot a rocket or fire a bullet, we better make sure that there is a legitimate reason for doing so and most importantly that we are going to hit the target. It does nobody any good to explode a $100,000 rocket on a sand hill in the middle of the dessert somewhere in the Middle East. Think before we shoot, aim before you pull the trigger.

SOURCE: http://blogs.alternet.org/speakeasy/2011/04/04/400-billion/