As the deadline to file federal taxes is finally behind us amid rocky but slowly improving economic times, the typical debate about whether wealthier taxpayers should shoulder a greater portion of the tax burden has again become a ubiquitous topic in both political debates and within the media.
Usually, it’s people in the middle and lower-income brackets that contend that the rich don’t pay their fair share. Now, however, an organization has been formed that offers quite a surprising and remarkable take on this perennial debate.
A group of admirable Americans has formed an organization called United for a Fair Economy that hopes to change federal tax laws to increase taxes on the wealthiest Americans. The leaders of this organization are indeed “admirable” because they are willing to walk the talk. They are in the upper echelons of wage earners and are helping to serve as lead advocates to make people like themselves pay more in taxes.
Why would they do this? The organization’s founders, who total some 700, believe that it’s unfair that they pay so little in taxes under the current IRS code and insist they are fully capable of doing more. It is to many a thoroughly refreshing attitude.
When you consider how much of this country doesn’t contribute at all or pays out far less than perhaps they should, it’s no wonder our government’s fiscal health appears to be in critical condition. The Tax Policy Center, an independent Washington think tank, estimates that 45 percent of all U.S. households will pay no federal income tax in 2010. None. Meanwhile, the federal tax code now provides some $1.1 trillion in credits, deductions and exemptions, an average of about $8,000 per taxpayer, according to the National Taxpayer Advocate, empowered to act as a watchdog agency operating within but monitoring the actions of the IRS. United for a Fair Economy isn’t simply an organization of like-minded people with a vastly different view of personal responsibility when it comes to taxes compared to so many other wealthy people. It’s a determined group of activists who are working strenuously to get their message out and who are determined to change the way other wealthy Americans, as well as citizens across the country, view the responsibility to assume an equitable burden for paying taxes.
Just their mission statement alone is virtually shocking to read when considering that it’s coming from the haves, not the have-nots: “UEF raises awareness that concentrated wealth and power undermine the economy, corrupt democracy, deepen the racial divide, and tear communities apart. We support and help build social movements for greater equality.”
The group’s bold pledge brandished on their web site is “Tax us More.” Intriguingly, the organization even encourages wealthy Americans to use a calculator on their website to figure out what their taxes would have been if the Bush era tax cuts were repealed, encouraging those who do so to “redirect their savings” to help fund the efforts of groups working to institute more progressive tax policies.
United for a Fair Economy points out that inherited wealth and passive income, such as the interest that investors earn on securities, is taxed at a smaller percentage rate, 15 percent, than the 25 percent federal tax rate on earnings. The distinction that this group makes between tax on income and on inherited or investment funds is one that revered Republican president, Teddy Roosevelt, made part of his own personal platform. Roosevelt was adamant in his belief that taxes on money actually earned should be equitable among different classes and that there should be a greater burden placed on those with incomes received from inheritance or investment funds.
There are critics of such enlightened thinking that would simply dismiss the views of a group offering such a provocative philosophy as “socialism.” But as one of the organization’s leaders, Eric Schoenberg, is quick to point out, there’s simply no reason he shouldn’t be required to pay more. While in a typical year, he earns more than half a million dollars, when his income fell to just over $200,000 in 2009 due to investment losses, his federal income tax bite was just $2,000.
“Do you think this is reasonable, that somebody in my circumstances should only be paying 1 percent of their income in tax?” Schoenberg asked rhetorically.
One of the geniuses in Congress, Sen. Orrin Hatch, recommends that rather than mandating higher taxes on the biggest wage earners, wealthy people who feel the way Schoenberg does should simply increase their tax payment and specify that they are donating money to the U.S. Treasury. Yeah, right.
It’s heartening to see some of America’s wealthy step to the plate and acknowledge that yes in fact,they can pay more and there’s no reason they shouldn’t do just that.
What a revolutionary concept. Now all we need to do is get a lot of U.S. corporations – say American-based oil companies for example – to follow the same example. Even then, these will just be small drops in the revenue bucket compared to the tsunami of debt created by four decades of deficit spending. (Our federal government has spent more than it has taken in every year since 1969).
No doubt, it’s going to take a lot more than leaning more heavily on the richest corporations and individual citizens to prevent the U.S. government from going bankrupt. Still, the spirit of people who care enough about this country to put more back into the public treasury represents the kind of unselfish thinking we so desperately need. If only America’s most prosperous companies would follow suit, it would be uplifting to people across this country. At least the middle class might feel that, for once, they are not all alone in shouldering the disproportionate burden imposed on them by the inequities in our federal tax code.
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