The 12-Tone Republican Chorale

by | Apr 13, 2011

If you’ve perused the specifics of the Paul Ryan budget proposal, you’ll no doubt–whether you find it admirable or loathsome–have realized its purpose is aparently to force the debate much further to the right.

An anonymous commenter (“Moose49”) at TPM put it beautifully:

It’s the same playbook they used when Stockman was OMB director [under Reagan]: slash taxes and blow the deficit sky-high when you control the executive branch, then force Democrats to shrink government and accept huge spending cuts when they’re in the White House. It’s brilliant strategy from their perspective, but the fact that it continues to work 30-odd years later is testimony to the incompetence of the Democratic Party, the sycophancy and gullibility of the news media, and the inanity of our public discourse.

Game, set and match, as far as I’m concerned.

And worth noting, too, that said David Stockman said this about Ryan’s plan: “It doesn’t address in any serious or courageous way the issue of the near and medium-term deficit. I think the biggest problem is revenues. It is simply unrealistic to say that raising revenue isn’t part of the solution. It’s a measure of how far off the deep end Republicans have gone with this religious catechism about taxes.”

Go ahead–say the wealthiest or even corporations should pay more instead of less. Then get out the baton, count out a four-beat, and listen as the right wing choir launches into its Schoenbergian chorus.

UPDATE: And we have a tenor! Can we get a baritone? Maybe an alto?

UPDATE 2: An interesting follow-up just arrived in my inbox:

With Shutdown Averted, Wealthy Citizens Call for Higher Taxes on Themselves as Part of Long-Term Solution:

Urge Return to Higher Tax Rates on Capital Gains and Dividend Income

Boston, MA – Now that the government shutdown has been averted, a surprising group of wealthy taxpayers are stepping up to the plate to be a part of the long-term solution. Today Responsible Wealth and United for a Fair Economy launched the “Tax Wealth Like Work” campaign to focus attention on the discrepancies in the U.S. tax system that reward income from wealth over income from work. Income from capital gains and dividend income – a type of investment income from stocks, real estate, and other holdings – is taxed at a top marginal rate of only 15 percent. Income earned from work, on the other hand, has a top rate of 35 percent.
With Congress and cash-strapped states struggle to balance budgets, high net worth individuals are urging that income from their stocks and investment portfolios be taxed at the same rate as income that others earn from work. Mike Lapham, director of the Responsible Worth network, notes that, “restoring the capital gains and dividend tax rate to the same rate that wages and salaries are taxed would raise $84 billion. That would easily cover the federal budget cuts being hammered out this week, with funds left over to help cash-strapped states.”
Taxing income from wealth at the same rate as income from work is not new and has support from across the political spectrum. Capital gains and dividends were taxed at the same rate as income from work as recently as the late 1980s under Presidents Reagan and Bush. Restoring tax parity between the two types of income was one of the recommendations of the 2010 U.S. Deficit Commission report. The Congressional Progressive Caucus included it in their framework for an emerging “People’s Budget” circulated last week.
Capital gains and dividend income is heavily concentrated at the top of the income spectrum. A typical household with $58,000 in income receives only 0.5 percent of its income from capital gains. By comparison, the top 0.01 percent of households, who earn an average of $35 million, typically receive more than 44 percent of their income from capital gains. Adding dividends pushes it well over 50 percent. This distribution of capital gains and dividends, coupled with the much lower tax rate, upends what would otherwise be a progressive tax system.

UPDATE 3: Yes, yes we did. Clangorous. Do we dare ask for a soprano?

UPDATE 4: Corporate taxes, of course, are not merely matters of rate. They are a combination of effective rate and effective enforcement. Corporations have little loyalty or patriotism–why does the right never call for corporate loyalty to America? (For our friend–check term “rhetorical.”)

Whatever the rate, actual cooperation instead of evasion from American companies would help. Surely our conservative friends don’t believe that a lower tax rate would evoke said cooperation?

If we taxed 1 percent, corporate lawyers would immediately find a way to get yet larger rebates. The trick is finding the right rate and the right enforcement. A proper “effective tax rate.” Surely we can agree on that.

Here’s Bernie Sander’s recent list of the odious facts:

The following is a news release from the office of Sen. Bernie Sanders (Vermont-I)

…

Sanders renewed his call for shared sacrifice after it was reported that General Electric and other major corporations paid no U.S. taxes after posting huge profits. Sanders said it is grossly unfair for congressional Republicans to propose major cuts to Head Start, Pell Grants, the Social Security Administration, nutrition grants for pregnant low-income women and the Environmental Protection Agency while ignoring the reality that some of the most profitable corporations pay nothing or almost nothing in federal income taxes.

Sanders compiled a list of some of some of the 10 worst corporate income tax avoiders:

1) Exxon Mobil made $19 billion in profits in 2009. Exxon not only paid no federal income taxes, it actually received a $156 million rebate from the IRS, according to its SEC filings.

2) Bank of America received a $1.9 billion tax refund from the IRS last year, although it made $4.4 billion in profits and received a bailout from the Federal Reserve and the Treasury Department of nearly $1 trillion.

3) Over the past five years, while General Electric made $26 billion in profits in the United States, it received a $4.1 billion refund from the IRS.

4) Chevron received a $19 million refund from the IRS last year after it made $10 billion in profits in 2009.

5) Boeing, which received a $30 billion contract from the Pentagon to build 179 airborne tankers, got a $124 million refund from the IRS last year.

6) Valero Energy, the 25th largest company in America with $68 billion in sales last year received a $157 million tax refund check from the IRS and, over the past three years, it received a $134 million tax break from the oil and gas manufacturing tax deduction.

7) Goldman Sachs in 2008 only paid 1.1 percent of its income in taxes even though it earned a profit of $2.3 billion and received an almost $800 billion from the Federal Reserve and U.S. Treasury Department.

8) Citigroup last year made more than $4 billion in profits but paid no federal income taxes. It received a $2.5 trillion bailout from the Federal Reserve and U.S. Treasury.

9) ConocoPhillips, the fifth largest oil company in the United States, made $16 billion in profits from 2007 through 2009, but received $451 million in tax breaks through the oil and gas manufacturing deduction.

10) Over the past five years, Carnival Cruise Lines made more than $11 billion in profits, but its federal income tax rate during those years was just 1.1 percent.

Sanders has called for closing corporate tax loopholes and eliminating tax breaks for oil and gas companies. He also introduced legislation to impose a 5.4 percent surtax on millionaires that would yield up to $50 billion a year. The senator has said that spending cuts must be paired with new revenue so the federal budget is not balanced solely on the backs of working families.

“We have a deficit problem. It has to be addressed,” Sanders said, “but it cannot be addressed on the backs of the sick, the elderly, the poor, young people, the most vulnerable in this country. The wealthiest people and the largest corporations in this country have got to contribute. We’ve got to talk about shared sacrifice.”

UPDATE THE LAST: The largest question remains–can a duo count as a chorus?