Thursday, August 16, 2012

But they're more important, aren't they...

Mitt Romney has thus far been unwilling to release more than two years of his tax returns. It’s not that he has to release his returns, but what Romney doesn’t understand is that while no one is going to actually force him to do so, not releasing them keeps the question in the air and will ultimately be answered by the American people during the election. Romney doesn’t get it. He’s whining, as if it’s the Obama campaign that is demanding the release. The Obama campaign knows he doesn’t want to release them, so having someone else like Harry Reid continue to press the issue is brilliant, because as long as people are suspect about why Romney doesn’t want to release them, they’re not thinking about the fledgling economy.
However, Romney’s reticence to release more than two years’ returns is not what I want to take about, it’s more about Romney’s general philosophy on taxation. Romney just released a statement today (unsubstantiated by documentation) that he has paid no less than 13% taxes over the past 10 years. Okay, let’s take that statement at face value; that would mean that Harry Reid’s “source” was lying, and that Mitt Romney had in fact paid taxes. However, 13% taxes is a MUCH lower rate than the majority of Americans pay, especially working Americans.
The standard rate is about 35%. Fair or not, that is what it is. However, most wealthy people pay much less that than, typically between 15 – 25%, if not less. The current Republican position is that capital gains and inheritance should be taxed at a much lower rate than income. Flat – that’s their position. So essentially what they’re saying is that they think that people who make money from doing nothing (and already have a substantial amount of money) should be taxed at dramatically lower rates (or nothing at all) than people who actually work. If I make $10,000 a year, I would pay roughly $3,500 in taxes. However, if I made $100,000,000 from investment income, I would only pay $13,000,000 in taxes (taking home $87,000,000), or none at all under they Romney/Ryan plan.
Romney says that the reason for the lower tax rate is because those people with vast sums of money invested are “job creators”; but Warren Buffet, one of the richest men in the world, makes the argument that people make investments to make money, not based upon what tax they will be paying. The reason the so-called “job creators” are not investing in the current economy is because it’s in the tank and they will not see a return on their investment.
Ultimately, this is an issue of supporting the country that supported you (Obama’s argument). Wealthy people have made vast sums of money over the past 3+ decades because of policies that cut their tax rates dramatically and allowed them to park their money in foreign countries. Also, a lot of their money has been made in investments that did little or nothing to actually create jobs, but instead were specifically made to create wealth (hedge funds, investment firms, etc.). Therefore, while their incomes and wealth have risen dramatically (nearly 400%), the real incomes of the upper middle, middle, and lower classes have either stagnated or even fallen. Literally fallen. The average income has fallen from about $36,000 in 1970 to $32,000 in 2010.
Since the wealthy have benefitted so nicely from these rates and policies over the last three decades, and since their wildcat investments drove our economy over a cliff, it’s time they started paying back. Even making the tax rate even across income/investment levels would be more fair than what we currently have. But what we really should do is cut out tax breaks and loopholes specifically designed for the wealthy, and create a graduated wealth and income tax that forces the wealthy to put in their fair share of income to this country that has benefitted them so much. If they don’t like the tax policies, they can leave. The country could use LESS people who are making vast sums of money toying with the market, but then paying nothing into the public coffers once they get their big payoff. Our country is hurting, and it’s obvious that Mitt Romney and those of his ilk care nothing for this country or the economy, but instead are still looking out for themselves and their wealthy friends.
Newt Gingrich charged Obama with stoking the flames of “class warfare”; and you know what, he was right. But the class warfare is not being waged by the poor against the rich, it’s being waged by the rich against the poor, and has been for generations. It’s about time a leader, and especially a president, highlight this issue and try and open the eyes of the majority of the people in this country who are being swindled by a bagful of citizens.

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