Did you get a $1 million dollar cut in your taxes?
Taxpayers with incomes above $10 million saved $1 million on average on their 2003 taxes, according to the latest available IRS data, thanks to tax changes under President Bush. Tax breaks will be bigger this year.
It would take about 29 years for a full-time worker to make a million bucks at today’s average hourly wage, which is falling behind inflation.
Taxpayers with incomes above $10 million “paid about the same share of their income in income taxes as those making $200,000 to $500,000 because of the lowered rates on investment income,” reports tax expert David Cay Johnston. At the state and local level, low-income taxpayers pay a greater share of their income in taxes than wealthy taxpayers.
Taxpayers with incomes less than $50,000 — the great majority of taxpayers — saved an average $435 in 2003. It would take 2,300 years to match a million-dollar tax cut.
And taxpayers lost much more than $435 to deepening budget cuts and rising fees for services taxes once funded.
Why are millionaires getting big tax breaks while Congress cuts tuition aid for kids whose families can’t afford to pay for college?
Why are millionaires getting tax breaks while soldiers are killed and maimed in Iraq for lack of adequate armor?
Why are millionaires getting tax breaks while vital levees are shortchanged from New Orleans to California?
Why are millionaires getting tax breaks while 46 million Americans have no health insurance and, as the Institute of Medicine documents, lack of health insurance causes thousands of needless deaths a year?
Taxpayers with incomes above $1 million will see their after-tax income grow by about 6 percent in 2006 because of tax cuts the nation can’t afford.
The worst is yet to come. As the Center on Budget and Policy Priorities reports, current and proposed tax cuts for households with incomes above $1 million would cost more than the combined cuts planned over the next five years for education, veterans health benefits, medical research, environmental protection and programs such as housing, energy, child care and nutrition assistance for families living in poverty.
President Bush has given so much revenue away in tax breaks, he’s already racked up more new debt than all the presidents combined accumulated before 1990. We are in record-breaking debt to foreign countries. And without a change in course, Bush will nearly double the national debt during his presidency.
Borrowing money from economic competitors to pay for tax breaks for millionaires and billionaires is more stupid than borrowing money from Tony Soprano to gamble.
Tax expert Robert McIntyre says, in the last fiscal year, “one out of every four dollars in federal spending outside of Social Security was paid for with borrowed money. That $501 billion shortfall occurred mostly because personal income tax revenues as a share of the economy were 29 percent lower than they were in fiscal 2000. the year before Bush took office.”
“Extending the 2001 and 2003 tax cuts would add $3.3 trillion (including interest) to deficits over the next decade,” reports the Center on Budget and Policy Priorities. “Each year the tax cuts would cost as much as the annual budgets of all these federal departments combined: Education, Veterans Affairs, Homeland Security, Energy, State, Housing and Urban Development and the Environmental Protection Agency.”
Tax cuts are boosting the superrich and sales of “giga-yachts” longer than football fields, but they aren’t boosting the economy. The current economic recovery has had weaker growth in employment, wage and salary, gross domestic product, consumption and investment than the typical post-World War II recovery.
Taxes are our dues for democracy. Taxes are how we pool our money for public health and safety, infrastructure, research and services — from the development of vaccines and the Internet to public schools and universities, transportation, courts, police, parks and safe drinking water.
Without fair and adequate taxes, we cannot repair the public infrastructure inherited from past generations or meet the challenge of global warming. We cannot invest in the research and education vital for future progress.
Tax forms should come with a warning: Tax cuts for the rich are hazardous to the nation’s health, economy and security.
It’s time to change course.
Holly Sklar is co-author of “A Just Minimum Wage: Good for Workers, Business and Our Future” (www.letjusticeroll.org) and “Raise the Floor: Wages and Policies That Work for All Of Us” (www.raisethefloor.org). She can be reached at [email protected]