Tax Reform Means Everything Is On The Table

by Steve

Thanks to PollingReport.com for the graphic

As we approach the income tax filing deadline (and please disregard the annually discredited work of the Tax Foundation and Heritage, among others), and with Bush’s Social Security privatization gambit showing signs of hitting a brick wall, conservatives are talking once again about tax reform to reenergize their financial base. Yet to conservatives, tax reform is code-speak for finishing the job of eliminating any tax burden for investors and wealth, and shifting the burden totally onto the backs of wage earners. The tax victories of Bush’s first term, wherein he pushed through large cuts in the tax burdens of the wealthy by cutting capital gains, dividend, and top-margin taxes, while leaving alone a looming tax grab on more and more taxpayers should have been seen as a wakeup call by Democrats that by not addressing the unindexed Alternative Minimum Tax and then calling for making the first-term tax cuts permanent, Bush never had any intention of keeping the best interests of wage earners in mind.

Put simply, the man and his party took the surpluses that were built up in a bipartisan manner at the end of the last decade to deal with Social Security's solvency problems, and spent them away on the wealthy. Now, having committed that travesty, he wants to set the terms of the debate for crippling Social Security and permanently underfunding this country's needs in the future, while some in his own party now question how much further they can go with this selfish irresponsibility.

F**k him and the lawn tractor he rode in on.

Even in the face of deficits that our current revenue base can never erase, and a tax collection system that is tilted in favor of the wealthy and corporations, and against everyday wage earners and the poor, Bush insists that any tax reform be revenue neutral. This is not only a trap, but also a precondition that should be summarily rejected by Democrats from the outset.

Federal revenues as a share of GDP are at their lowest levels since 1950, and yet the White House is running a foreign policy that it cannot and will not pay for. We have unmet needs here at home in a variety of areas, including homeland security, veterans benefits, health coverage, infrastructure, local law enforcement, border control, and many others. It is clear that the ultimate GOP aim is to shift more taxes onto wage earners and away from the wealthy. We have a historically high disparity between rich and poor, and a growing level of tax avoidance and nonpayment by the wealthy and corporations. Recent polls show that the public is against a flat tax in favor of our current progressive taxation system. The public, according to tonight's NBC News/Wall Street Journal poll, also feels that the current tax system is unfair, with more than half now saying that corporations don’t pay their fair share.

Democrats should not be shy about asking publicly when are the wealthy and corporations going to begin paying their fair share to fight terrorism and deal with unmet needs here at home. Democrats should also make a 2006 campaign issue out of the Administration’s effort to redirect the IRS’s attention away from the wealthy and onto the backs of the working class. Lastly, as part of a large package, Democrats should make it clear that everything is on the table, including:

· Phasing out all of the first-term tax cuts;
· Indexing the AMT;
· Closing tax shelters, loopholes, and avoidance schemes;
· Making corporations pay instead of avoid income taxation;
· Increasing IRS tax collections on the wealthy;

And please spare me any drivel about class warfare. Everday folks may not want to beat up on the wealthy, but they still believe as the polls indicate that everyone should pay their fair share. The GOP engages in class warfare as their economic weapon of choice every day, and no garbage about "a corporate tax is a tax on consumers" is going to cut it with me. There is no rationale why Fortune 500 corporations escape taxation for years, and no justification for why these companies get more and more tax breaks while the IRS ignores them and goes after the wage earners in this country. And so what if corporate income taxes are a tax on consumers? Our corporations should pay their fair share for being able to operate in this country, use these resources and economic infrastructure, and have this military defend its ability to make as much money as they want.

As we have said many times before, as much as gay marriage or abortion may be moral values, how you treat your fellow man and the policies you adopt that sprinkle benefits to the few at the expense of the many are moral values also, and demonstrate the choices made by Republicans who claim a moral superiority over Democrats. Tax fairness, deficits, the arrogance and corruption of entrenched GOP control of the government, and a government that favors the wealthy while shafting and ignoring the needs of the middle and working classes is a tailor-made moral values platform for the Democrats to batter the GOP with next year.

And frankly, a man whose approval ratings have now sunk to around 40% and perhaps below, who has Tom DeLay hanging like an albatross around his neck and that of his party should not be feared, but aggressively battled on every initiative because he has no political capital. Tax policy, along with Social Security, would be two good pillars for such a moral values war against the GOP for next year’s midterms.