AMERICA - Two on Economic Inequalities

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"America Isn’t Broke But Republican Fiscal Morals Are Bankrupting Us" by Ray Medeiros, PoliticusUSA 4/7/2011

The burden of taxation has been systematically and heavily shifted onto the individual and away from Corporate America over the last 35 years. This should be of grave concern to the American people. The tea party rose up in 2008 chanting “Taxed Enough Already”, I stand with them on that statement. The American individual has been shouldering more and more of the cost of Government since the conservative Reagan revolution.

Where I differ with the tea party is lowering corporate taxes. According to the Urban and Brookings Institutes, the percentage of federal revenue coming from individuals, including sole proprietors was 41.5%, the percentage paid by corporate America was 8.9% in 2010.

In 2008, the federal government collected $2.5 trillion, an amount equal to 17.7 percent of GDP. Federal revenue has ranged from 14.4 to 20.9 percent of GDP over the past five decades, averaging 18.2 percent.

The individual income tax has been the largest single source of federal revenue since 1950, averaging just over 8 percent of GDP.

Revenue from the corporate income tax fell from between 5 and 6 percent of GDP in the early 1950s to 2.1 percent of GDP in 2008.

The conservatives like to throw around America’s corporate tax rate. They say it is too high and it is the cause of our economic problems. What they haven’t told the American people is corporate tax receipts to the federal government is very low. Corporations contribute very little to our government, YOU ARE SHOULDERING THE COST! The Reagan administration and subsequent administrations have increased the FICA tax (social security tax) and used that surplus to bridge the gap. This is a direct tax on the individual.

Imagine if we brought the amount corporations contributed to our society back to the levels of the 1950s, where they accounted for 30% of tax receipts. Back in those days, we built the interstate highway, built new schools, had a balanced budget and created NASA from scratch!

Today we could renovate our national power grid and create clean energy, build high-speed rail and many other things that need to be fixed in this country since we put off maintenance. The reason why we put it off is because of a cash flow problem.

Instead of doing what needs to be done, the Republicans are cutting away at the safety net that has created the middle class and sustained our elderly population. This can not happen in the wealthy country.

We are not broke, but we are becoming morally bankrupt!

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"Off-the-charts income gains for super-rich" by Zachary Roth, The Lookout 4/8/2011

In recent years, we've been hit with a barrage of statistics, charts, and even full-length books, documenting how inequality is on the rise in America.

But very few of them capture what's happened over the last 30 years or so as well as this image:

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Put together by the Center on Budget and Policy Priorities, a liberal Washington think tank, the chart is pretty self-explanatory. It shows that the 30 years following the Second World War were a time of broadly shared prosperity: Income for the bottom 90 percent of American households roughly kept pace with economic growth.

But over the last 35 years, there's been an abrupt shift: Total growth has slowed marginally, but the real change has been in how the results of that growth are distributed. Now, the bottom 90 percent have seen their income rise only by a tiny fraction of total growth, while income for the richest 1 percent has exploded by upwards of 275 percent.

One can argue about why this is happening. Some say it's the result of a decline in workers' bargaining power as labor unions have weakened, while others blame the rise of offshoring and outsourcing. But despite the best efforts of some commentators, there's really no serious debate about the overall realignment of income in our age: The already super-rich have vastly increased their share of the pie--at the expense of everyone else.

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