I've been intrigued with the coverage of Romney's tax return releases, sparse as that coverage has been, even in the so-called "left" media and new media.
Nearly all the coverage in the major mass media has been an effort to normalize Mr. Romney's situation, using terms like "unsurprising," "typical for wealthy people like the Romneys," "sophisticated but perfectly legal," and so on.
Note is made of Romney's remarkably low tax rate -- which of course is said to be a consequence of policies set by Congress, so there's nothing wrong with it. Of course not.
The idea that someone can make more than $20 million a year for literally -- quite literally -- doing nothing to earn it is not even mentioned as a bit "unusual," as if anyone could be doing this if only they... worked hard enough, or deserved it, or something of the sort, as if it were perfectly normal and should be celebrated as "an American success story."
The fact that the Romneys literally do nothing at all to "earn" most of this money, they are merely passive investors in mostly blind trusts, is not even considered worth remarking on.
How Mitt initially got the money to embark on this do-nothing wealth machine -- from the disruption and destruction of other people's lives and futures ("that's capitalism, my friend!") -- is only mentioned by rivals. The fact that Bain Capital is and has always been a predatory outfit, looting and destroying the work of others for its own profits is not a topic for discussion amid polite company at all.
It's all perfectly normal, what anyone of his wealth and financial sophistication (not to mention political ambition) would be expected to do.
And he tithes to his church, so he's obviously moral.
Stunning.
("And did you hear? Those nasty Democrats and that arrogant Negro in the White House are engaging in Class War again.")
Obama and the Dems have normalized this as well by setting the "opposition" bar so low -- which allows the right to suggest even further cuts in taxes.
ReplyDeleteIt never should have been a return to Clinton era rates as the negotiating point. They should have chosen Eisenhower.
And Obama keeps saying a millionaire should pay as much as his/her secretary? Uh, no. They should be paying three times as much.
Keeping the "response" so low enables the right to cut further. All the GOP candidates, including Ron Paul -- who seems to get a pass on this -- advocate for radical reductions in taxes for billionaires, corporations, scions of royal houses and vulture capitalists.
Paul is one among many in the GOP field advocating for an end to capital gains taxes, which means Romney wouldn't have paid anything. He also wants to end the estate tax, which only impacts those with 5 million or more to begin with. And Paul, like all the rest of the GOP field, wants to slash corporate taxes. As if they pay their taxes now.
They all seem to want taxes to go to Less Than Zero.
Add to that, their killer love of cutting the deficit, and it's easy to see their tax cuts producing draconian austerity in America.
That's the other part of "normalizing" rhetoric. In a sane world, no one would have been able to push the upside down notion that cutting government spending in dark times was a good thing.
Those billionaire propertarians have certainly gotten their money's worth. They along with the rest of the right have managed to change the paradigm from at least an attempt at common sense to no sense at all.
Top marginal income tax rates were increased in 1932, then again in 1936, 1940, 1941, 1942, and 1944. In addition, from 1940 on, there were various surtaxes and so forth that were specifically meant to pay for the War.
ReplyDeleteIncome taxes topped out at 94% on incomes amounts over $200,000 in 1944 and 1945, reduced to 91% in 1946 where it stayed until it was increased to 92% in 1952 (Korea Conflict). Top marginal rate was reduced to 91% in 1954 where it stayed until 1964 when it was dropped to 77%. (During that period the amount of income triggering the highest marginal rates went up from $200,000 to $400,000.) The top rate fell to 70% in 1966 where it stayed until 1982, when it dropped to 50% where it stayed until 1986. It dropped to 38.5% in 1987 and to 28% in 1988.
Of course the rich have always been able to shelter vast amounts of their income, so they have never paid those "awful, crippling, confiscatory tax rates" that were advertised. The argument has been made that the rich have only ever paid what they choose to pay in income taxes, whereas everyone else is required to pay the going rate. But that's not quite true either.
What's almost always left out of the equation is that low-income workers (especially if they are married and have families) have never been assessed income taxes -- except for a brief period during WWII, and even then, exemptions enabled many workers to escape an income tax obligation.) The "going rates" only apply to the taxable portion of income, never to all income. While lower income workers have fewer ways to shelter income, much or all of their income tax obligation is negated by exemptions and credits.
Ultimately, those who pay income taxes seem to mostly be hovering in the 16% range more or less, with taxpaying workers in the lower brackets paying around 8% of their total income.
This is absurdly low taxation -- and everybody knows it.
The question of taxation is only part of the problem, however. Romney's situation is a case in point. He does nothing at all to "earn" the tens of millions of dollars he accumulates every year. Nothing. It's almost all passive investment income. Why shouldn't that kind of income be taxed at a significantly higher rate than wage and benefit income? (Social Security, Retirement, and Unemployment income are all subject to taxation above a certain very limited amount.)
Why shouldn't Romney's investment income be subject to confiscatory tax rates?
Of course some low and high income individuals and a large contingent of corporations are already in the "less than zero" tax bracket, paying nothing at all and receiving substantial refunds from tax credits.
The notion that the rich who make their money from financial chicanery and investments rather than from working shouldn't pay tax at all is hideous. The more people realize that's the Pauliac position the less they like it. But that's the widespread R point of view: they see taxes as punishment, and the rich don't deserve to have their wealth and success punished by being forced to pay taxes.
Austerity, of course, is exactly the wrong course to take in a recession -- but faith overrides reason among the highest of the mighty, and austerity is their belief system. They cannot let go.