Tuesday, August 21, 2012

Redistribution of Tax Liability: A Message from the American Working Class

   Over the last 30 years we have been indoctrinated into believing that redistribution of wealth was a black mark against the American Dream, capitalism and the world of free markets. It caters to the notion that “taxation is a form of punishment for success” and that we tax the wealthy for the sole benefit of ‘freeloaders”. The wealthy are the “job creators” has been bellowed from the highest mountain as if it should alarm us to impending doom. The reality is that there has been a redistribution of tax liability from the wealthiest to the bottom 95% and our revenues have plummeted to unsustainable levels. 
   Americans are the most productive workers in the world. Our productivity has realized a steady rise over the last couple of decades and yet our median income has remained flat and is now on its decline. All of the benefits and profits of our increased productivity have benefitted the top. Apparently we have not “earned” it and they did. We are not in control of the levers that give or deny us a raise even for consistent excellent performance. The business model of ‘pay for performance’ is largely a ruse. Those that have benefitted the most are the ones in control of this distribution of wealth. 
   They are the same people in control of the redistribution of tax liability via our tax policy. Our country’s ‘progressive’ tax code has realized a flattening of the tax structure because of a tax code that most Americans do not have access to. Different laws for the different classes. The tax cuts for the wealthiest on the federal level have resulted in the shifting of tax liability to the states and then on to localities as federal dollars dry up. I can remember Lowell Weicker falsely reassuring us that our new state tax was only a ‘temporary’ measure. That was twenty one years ago. 
   Simple math now escapes our congressmen. If we cannot tax the bulk of American wealth, who will pay for a necessary government? One can easily make the argument that we are on a slippery slope to fascism. Corporate power is palpable in all facets of our government and our law making process. 
   Let me say this out loud. I am a job creator. The 95% are the job creators. We collectively create the demand that generates production of goods and services. Starving us is what is starving our economy. The only mechanism to retrieve our fair share of the productivity advances is to tax the top at an appropriate tax rate. If those in control feel our excellent performance does not warrant financial reward, then we should at least compel them to help adequately fund our government and lessen our burden of taxation. When it becomes acceptable that an hourly wage worker should pay a higher effective tax rate than a multi-millionaire, something has gone wrong with the system.
   America needs to redirect the conversation from the misappropriated and inaccurate catch phrase of redistribution of wealth and focus our attention to the distribution of wealth and redistribution of tax liability. These are the true killers of the American Dream.

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