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Political Animal

Tax The Poor!

By Brian Morton | Posted 12/25/2002

America, at its best, is compassionate. In the quiet of American conscience, we know that deep, persistent poverty is unworthy of our nation's promise. -- George W. Bush, 2001 inaugural address

Back on Nov. 20, the Wall Street Journal's editorial page, where many conservative ideas are hatched and test-marketed, published a novel thought: The poor pay too little in taxes, and some, horror of horrors, are so poor they don't pay any at all. The Journal, in its paroxysms of compassion, even coined a term for these people: "Lucky duckies."

By last week, the idea had already taken hold in the heart of the administration. On Dec. 16, the Washington Post reported that "Economists at the Treasury Department are drafting new ways to calculate the distribution of tax burdens among different income classes, which are expected to highlight what administration officials see as a rising tax burden on the rich and a declining burden on the poor."

In times of riches or recession, the Republican party loves the tax cuts. When the budget showed a surplus at the end of the 1990s, George W. Bush argued for tax cuts as a way to give people back their money. Despite the oncoming train wreck of Social Security, a health care crisis, and a still-sizeable national debt, he said we could afford it.

If gas prices were too high--pass his tax cut. That $300 you got back could go right into your gas tank.

If you couldn't afford prescription drugs--pass his tax cut. That $300 you got back could help ease the high cost of those pills (which are cheaper over the border).

When the bottom fell out of the economy, the president then argued that we needed a stimulus--pass his tax cut. Never mind the fact that he admitted that most of his tax cut benefited the wealthiest 1 percent of Americans, and that $300 payoff is a long-distant memory. It's time to fix the tax system again.

See it turns out the tax system isn't fair--to rich people. And those allegedly untaxed poor people, those "lucky duckies" in the Journal's parlance, aren't sympathetic to the heavy burden the wealthy pay and therefore won't line up in support for more tax cuts. "Workers who pay little or no taxes," the Journal's editorial stated, "can hardly be expected to care about tax relief for everybody else. They are also that much more detached from recognizing the costs of government."

Bummer, dude.

Typically enough, whenever the Right starts moaning about how untaxed are the poorer strata of the Great Unwashed, they tend to forget that little behemoth gnawing at the corner of your W-2s--your Social Security payroll taxes. As economist and New York Times columnist Paul Krugman points out, the Journal's editors whine about someone who makes about 12 grand a year might only pay four percent of his income in taxes--although when you add in those payroll taxes, it comes to more than 20 percent of income.

But according to the Post, ousted White House economic advisor Larry Lindsay was telling an American Enterprise Institute tax forum that payroll taxes shouldn't count toward calculating a person's tax burden, because we are supposed to be getting that back as a benefit later in life.

Now hold on a minute there, pardner.

They mocked Al Gore's "lockbox" back in 2000, saying we could save Social Security, cut taxes, and give each and every one of us back 300 bucks all at once. Now they're dipping into Social Security after having cut taxes for the rich; they're proposing to cut taxes further on the rich by trying to make those tax cuts permanent; and now they're saying that Social Security (whose funds they are dipping into as we speak) payroll taxes shouldn't count toward our tax burden because we'll get them back?

Oy.

This is all too funny when you consider the incoming man at the Treasury Department, John Snow, had the third highest compensation package among 37 transportation company executives surveyed recently, while his rail company's stock was falling. At the same time, that rail company paid no income taxes in at least two of the last four years while recording more than a billion dollars in pretax profits at the same time.

So remember, when companies flee to a post office box in the Bahamas in order to evade paying taxes, they're not doing anything illegal. When the Treasury designate can help his company avoid paying taxes for several years and get rewarded with a $2 million annual pension plan, while at the same time cutting back benefits for retired line employees, that's just doing good business by rewarding good managers.

But on $12,000 a year, you lucky duckies, you're just not taxed enough. Now get back to work.

On principle . . . those in the greatest need should receive the greatest help. . . . Now is the time to reform the tax code and share some of the surplus with the people who pay the bills. -- George W. Bush, nomination acceptance speech, 2000

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