No 395 Posted by fw, January 27, 2012
Did you know that U.S. corporations paid 47.4 percent of profits in taxes in 1961 and just 11.1 percent of profits in taxes in 2011? Would you believe that income inequality is rising at a faster pace in Canada than it has been in the US? (It’s true. Check out the infographic below, in RELATED LINKS)
The following video, We’re Not Broke, Just Twisted: Extreme Wealth Inequality in America, is an entertaining, treasure trove of financial facts for activists to add to their knowledge base. The video, uploaded by InstPolicyStudies on May 18, 2011, features the creative wizardry of Chuck Collins, Alison Goldberg, Scott Klinger, Sam Pizzigati. An accompanying text that appeared with the video is included.
Or so claim governors and lawmakers all over the country. Our states and our nation can no longer afford, their plaint goes, the programs and services that Americans expect government to provide. We must do with less. We need “austerity.”
But we’re not broke. Not even close. The United States of America is awash in wealth. Our corporations are holding record trillions in cash. And overall individual wealth in the United States, the Credit Suisse Research Institute reported this past fall, has risen 23 percent since the year 2000, to $236,213 per American adult.
We have, these indicators of overall wealth suggest, survived the Great Recession quite nicely. So how can average families — and the national, state, and local governments that exist to serve them — be doing so poorly? Why do “deficits” dominate our political discourse? What explains the red-ink hurricane now pounding government budgets at every level?
This Tax Day report identifies two prime drivers behind our current budget “squeeze.”
- One, we have indeed become wealthier than ever. But our wealth has become incredibly more concentrated at our economic summit. U.S. income is cascading disproportionately to the top.
- Two, we are taxing the dollars that go to our ever-richer rich — and the corporations they own — at levels far below the tax rates that America levied just a few decades ago. We have, in effect, shifted our tax burden off the shoulders of those most able to bear it and away from those who disproportionately benefit from government investments the most.
These two factors — more dollars at the top, significantly lower taxes on these dollars — have unleashed a fiscal nightmare. Can we wake up in time to avoid the crippling austerity that so many of our political leaders insist we must accept?
This report offers both an analysis of our current predicament and a series of proposals that can help open our eyes to a far more equitable — and brighter — future.
Key Tax Facts
- 15,753: The number of households in 1961 with $1 million in taxable income (adjusted for inflation).
- 361,000: The number of households in 2011 estimated to have $1 million in taxable income.
- 43.1: Percent of total reported income that Americans earning $1 million paid in taxes in 1961 (adjusted for 2011 dollars)
- 23.1: Percent of total reported income that Americans earning $1 million are likely to pay in taxes in 2011, estimated from latest IRS data.
- 47.4: Percent of profits corporations paid in taxes in 1961.
- 11.1: Percent of profits corporations paid in taxes in 2011.
With the United States in the grip of the worst economic recession since the Great Depression and an unprecedented budget deficit, the conclusion that our country is broke seems unquestionable. At least that’s what politicians and pundits want ordinary citizens to believe.
Karin Hayes and Victoria Bruce’s searing exposé reveals that, strangely absent from this rhetoric, is the infuriating fact that multibillion-dollar corporations are based in the U.S., make money from American consumers, and often even receive lucrative contracts from the government, yet pay nothing in U.S. income taxes. By exploiting tax-law loopholes and spending millions on lobbyists to pressure politicians to protect their interests, corporations pocket billions while the less-connected middle class disappears, and the poor get poorer.
We’re Not Broke explores how the government has allowed this inequality to develop and the growing wave of discontent that it has fostered. Presaging the larger wave of protests from the international Occupy movement, the film follows a number of activists who have had enough and are demanding that corporations finally pay their fair share.