From Newsletter Volume 5, Number 1

01 May 2009 10:15 PM | Posted by GNHLHA
Tax Troubles  by Troy Rondinone    

           
As we all know, this past Tax Day saw widespread “rebellion” against the “tyranny” of the Obama administration.  Protesters gathered in cities across America, some dressed in American Revolutionary costume, denouncing the creeping socialism of “tax and spend” policies.  One sign in Washington proclaimed “D.C.: District of Communism.”  A protester in Texas shouted “secede!” during a rally held by the Governor.  

Supported by Fox News and lots of opportunity-smelling Republicans, the “tea parties” carried with them an ominous message.  American History, they suggest, supports revolution when civic liberties are trounced by leaders carrying out unjust taxation.

Obama’s press secretary was quick to point out that 95% of working families received a tax cut.  Indeed, the new tax policy seems aimed almost entirely at the rich.  So why protest?

Strangely, the protests do have some resemblance to the original Tea Party.  That act was also carried out by working people, but organized by wealthy merchants who had something to lose when the Crown set to cut off their smuggling profits.

The fact of the matter is that there is a problem with the tax code.  Only, this is not a problem most protesters seem to be aware of.  The problem is that the rich still pay too little.  According to a recent report from the Institute of Policy Studies, over the past generation there has been a quiet revolution in our tax code.  Back in 1955, folks who made over $2 million (in 2006 terms) paid about 49% of it in taxes.  In 2006, this same category of earners paid about 23%.  During this same period, the rich saw their share of the nation’s income double and the very richest saw an increase in wealth by a factor of more than 20 (see www.ips-dc.org/reports/#1207).  The reason for the low percentage is due to creative loophole-finding amongst the wealthy (taxes on the top are technically around 39%, up from the Bush-era figure 35%). 

The protesters, many of whom I suppose will see tax cuts this year, might want to look more closely at the folks (who actually stand to lose revenue) egging them on.

Troy Rondinone is recording secretary for the Executive Board of the Greater New Haven Labor History Association.  He teaches American History with a concentration in Labor History at Southern Connecticut State University.  His views in the commentary are his own.  The Association does not take political stands, but does welcome debate about both current and historical issues of interest to working people.

Greater New Haven Labor History Association  •  267 Chapel Street, New Haven, CT 06513 •  info@laborhistory.org •

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