Wednesday, March 16, 2011

None of state's congressmen support most-popular revenue plan

According to an NBC/Wall Street Journal poll taken on March 2, 81 percent of Americans support putting a surtax on federal income taxes for those who make more than $1 million per year. Seeing that the vast majority of Americans favor such a notion, and the needs for federal aid to states stands at an all-time high, U.S. Rep. Jean Schakowsky of Illinois has drafted a bill to do precisely that.

Schakowsky has collected support in the form of co-sponsors for her bill from across the land, from Raul Grijalva in Arizona to Keith Ellison of Minnesota, to John Yarmuth of Kentucky and Steve Cohen of Tennessee, to Donna Edwards of Maryland and Pete DeFazio of New York, and others. Missing from her list of co-sponsors is a single name from South Carolina.

Here again, an idea identified by a majority of Americans as a good one is decidedly out-of-favor here at home.

Income inequality in America is the worst we’ve seen it since 1928. Wages have stagnated for middle and lower income families despite enormous gains in productivity. Where has all the money gone?

“In the United States today, the richest 1% owns 34 % of our nation’s wealth – that’s more than the entire bottom 90%, who own just 29% of the country’s wealth,” said Rep. Schakowsky. “And the top one-hundredth of 1% now makes an average of $27 million per household per year. The average income for the bottom 90% of Americans? $31,244. It’s time for millionaires and billionaires to pay their fair share, which is why I introduced the Fairness in Taxation Act. This isn’t about punishment or revenge. It’s about fairness. It’s about avoiding budget cuts that harm middle class families and those who aspire to it. We can choose to cut education, job creation and health care, or we can choose to ask those who can contribute more to do so.”

Is it the case that South Carolina's population includes so many millionaires that their numbers outweigh the will and needs of the remainder? Is that what holds back our legislative delegation in Washington from supporting a popular tax proposal?

I stood last Saturday among the 2,500 at the State Capitol in Columbia and, honestly, though I didn't do a poll of the rally crowd, I doubt there was a single millionaire present.

And to date, I haven't seen a single protest or demonstration organized by or for South Carolina's millionaires.

The current top tax bracket begins at $373,000 in income and fails to distinguish between the “well off” and billionaires – like the top 20 hedge fund managers whose average income last year was over $1 billion.

The Fairness in Taxation Act asks enacts new tax brackets for income starting at $1 million and ends with a $1 billion bracket. The new brackets would be:

* $1-10 million: 45%
* $10-20 million: 46%
* $20-100 million: 47%
* $100 million to $1 billion: 48%
* $1 billion and over: 49%

The bill would also tax capital gains and dividend income as ordinary income for those taxpayers with income over $1 million.

Schakowsky has even lined up support from some conscientious millionaires:

“I think very wealthy people like me should pay substantially higher taxes, since we have done exceedingly well in the last few decades,” said Katharine Myers, a millionaire from Pennsylvania whose income comes from royalties from the Myers-Briggs personality test, created by her mother-in-law, which she has managed with Peter Myers since the 1980s. “Our taxpayer-funded government contributed to my success.” Myers has been a supporter of United for a Fair Economy and its Responsible Wealth project for many years.

But none from those elected to represent impoverished South Carolinians in Congress.

Congresswoman Schakowsky has shown that there is another way,” said Steve Wamhoff, tax expert from Citizens for Tax Justice. “Her proposal would make the federal income tax more progressive by introducing higher rates for taxpayers with income in excess of $1 million. Millionaires have benefited disproportionately from the tax cuts enacted over the past decade, so it seems entirely reasonable that they share in the sacrifices needed to get our fiscal house in order.”

“The budget cuts being debated in Washington shamefully require middle class families to pay the price for the recklessness of the Wall Street bankers and hedge fund managers who broke our economy,” said Brian Miller, Executive Director of United for a Fair Economy. “Instead of punishing middle class families and de-funding America, the Fairness in Taxation Act asks those who have benefitted so heavily from the economic bounce of Wall Street to share responsibility for getting our nation's finances on track.”

“Any sensible program for deficit reduction must begin with changing the massive tax cuts for the very wealthy,” said Roger Hickey, co-director of the Campaign for America’s Future. “Those tax give-aways were a major cause of our current deficit. In an era of excessive inequality we should end Bush era tax cuts for the wealthiest Americans. We need progressive revenues not just to bring down deficits, but also to finance investments in job and sustainable growth. The introduction of the Fairness in Taxation Act is an important step that will be popular with the American people.”

Are there any conscientious members of Congress representing South Carolina? Even one?

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