America Isn’t Broke But Republican Fiscal Morals Are Bankrupting Us

Apr 07 2011 Published by under Uncategorized

The burden of taxation has been systematically and heavily shifted onto the individual and away from Corporate America over the last 35 years. This should be of grave concern to the American people. The tea party rose up in 2008 chanting “Taxed Enough Already”, I stand with them on that statement. The American individual has been shouldering more and more of the cost of Government since the conservative Reagan revolution.

Where I differ with the tea party is lowering corporate taxes. According to the Urban and Brookings Institutes, the percentage of federal revenue coming from individuals, including sole proprietors was 41.5%, the percentage paid by corporate America was 8.9% in 2010.

In 2008, the federal government collected $2.5 trillion, an amount equal to 17.7 percent of GDP. Federal revenue has ranged from 14.4 to 20.9 percent of GDP over the past five decades, averaging 18.2 percent.

The individual income tax has been the largest single source of federal revenue since 1950, averaging just over 8 percent of GDP.

Revenue from the corporate income tax fell from between 5 and 6 percent of GDP in the early 1950s to 2.1 percent of GDP in 2008.

The conservatives like to throw around America’s corporate tax rate. They say it is too high and it is the cause of our economic problems. What they haven’t told the American people is corporate tax receipts to the federal government is very low. Corporations contribute very little to our government, YOU ARE SHOULDERING THE COST! The Reagan administration and subsequent administrations have increased the FICA tax (social security tax) and used that surplus to bridge the gap. This is a direct tax on the individual.

Imagine if we brought the amount corporations contributed to our society back to the levels of the 1950s, where they accounted for 30% of tax receipts. Back in those days, we built the interstate highway, built new schools, had a balanced budget and created NASA from scratch!

Today we could renovate our national power grid and create clean energy, build high-speed rail and many other things that need to be fixed in this country since we put off maintenance. The reason why we put it off is because of a cash flow problem.

Instead of doing what needs to be done, the Republicans are cutting away at the safety net that has created the middle class and sustained our elderly population. This can not happen in the wealthy country.

We are not broke, but we are becoming morally bankrupt!

Image: CBO/America For Purchase

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