Our upside-down tax system
(published at the Bellevue Reporter) with the title “Blame politicians, poverty for school problems”)
The fundamental economic fact of the last 30 years is the relentless transfer of wealth from the middle class to the rich. During the 1950s and early 1960s, the top bracket income tax rate was over 90%. Now the top rate is 35%, but few corporations pay that rate. In 1952 corporate taxes covered 33% of federal tax revenue; now they cover less than 9%, despite record profits. Dozens of major corporations pay little or no federal income taxes, via gimmicks such as moving profits overseas. The Wall Street Journal reports that 95% of the income gains from the economic recovery of 2009 – 2012 went to the richest 1%. Nationwide, the percentage of corporate profits paid as state income taxes has dropped from 7 percent in 1980 to about 3 percent today. [See http://www2.ucsc.edu/whorulesamerica/power/wealth.html the articles on the left side-bar of this website, http://waliberals.org, for additional shocking statistics about income inequality.]
Conservatives slashed taxes for the rich, while at the same spending trillions of dollars on military adventures and hardware that lined the pockets of private defense contractors. Obsession with tax cuts and deregulation crashed the economy in 2008, causing corporations to come crying to the federal government for bailouts.
We don’t live in a capitalistic country. We live in a country where there is Socialism for the rich.
Washington State’s tax system is particularly regressive, due to our dependence on a sales tax and due to tax breaks for rich corporations such as Microsoft and Boeing — tax breaks supported by both Democratic and Republican lawmakers. There’s a race to the bottom among states competing to see who can starve education the most to line the pockets of the rich.
The plan among conservatives now is to blame economic problems on public schools, which society has been underfunding for decades. In fact, educational outcomes closely tracks rates of poverty, and countries which outperform us have public schools and lower levels of poverty. So don’t blame public schools. Blame our corrupt political system, in which politicians depend on the largesse of wealthy donors to get elected.