Inequality and the Common Good

"'The ultrawealthy in this country will still be able to pass on enormous wealth to the next generation,' said Chuck Collins, who studies income inequality and has worked with billionaires like Warren E. Buffett and Bill Gates to promote an estate tax. Mr. Collins argues that the tax is a 'recycling program for economic opportunity.'"

"Because as activist and author Chuck Collins has discovered, misery really does love company, especially when social interactions are aimed at helping end the misery. Since January 2009, Collins, an energetic, dark-haired 50-year-old, and his assistant, Andree Zaleska, have launched 115 Common Security Clubs in nine states. The clubs are citizen action groups designed to bring the unemployed — and the anxiously employed — together to help each other. Each club consists of 15 to 20 members, drawn from churches, union halls, environmental groups or neighborhoods. They meet in homes and church basements, and in Marion County, Ore., a group meets in an old Grange Hall."

According to Alternet’s David DeGraw, "The poorest one-fifth of the population pay more than eleven percent of their income in taxes, whereas the top one percent earning an average of more than two million dollars a year, are paying about seven percent." Over the last sixty years, the federal income tax level levied on those earning more than $400,000 has dropped nearly twenty percent from 91 percent to 70 percent, according to a recent report by the Institute for Policy Studies.

The Institute for Policy Studies reported:  '"Today, we have a two-tier federal tax system: one tax system for the wealthy and powerful corporations and another tax system for everyone else. The tax system for the privileged features loopholes and special provisions that enable wealthy individuals and global corporations to hide taxable income and receive special treatment. The tax system for 'regular people' offers few loopholes. Regular people pay the bulk of their taxes automatically, via paycheck deduction."

Use of the airspace is considered public information because taxpayers fund air-traffic controllers, radars and runways. "It belongs to all of us," said Chuck Collins, who has studied private jet travel at the Institute for Policy Studies, a progressive think tank. "It's not a private preserve."

"After 50 years of tax cuts by Kennedy, Reagan and Bush II, the middle class is paying the same share of income as they did in 1960," said Chuck Collins, co-founder of the group. "The richest 3 percent have gotten the gargantuan share of tax cuts."

In my community we’re facing severe cuts in schools and elder services, and our local public library and community recreation center will soon close. Yet our local property taxes and fees are rising. Why are we paying more and getting less for it?

In my community we’re facing severe cuts in schools and elder services, and our local public library and community recreation center will soon close. Yet our local property taxes and fees are rising. Why are we paying more and getting less for it?

What's crystal clear in this well-documented report--whose title might have been "The Real Story Behind Today's Unfair Economy"--is that the middle-class has largely been shafted by both Republicans and Democrats, whose campaign coffers are equally greased by wealthy donors. And the shift in the tax burden has fueled a rising inequality and concentration of wealth that weakens our democracy--as The Nation argued in its June 30, 2008 special issue, "The New Inequality."

The WCG report notes that the top marginal tax rate was 91% in 1960 before it started dropping during the Kennedy administration. The effective rate (total tax paid on gross income) for the "IRS 400" dropped from 51.2% in 1955 to 16.6% in 2007. The report says the effective rate on the middle class--defined as the middle 20% of taxpayers--rose from 15.9% in 1960 to 16.1% in 2007.

The authors assert, "Our nation has borrowed money to pay for the tax cuts that have gone and continue to go to America's wealthy, a reality that will have future generations of mostly middle-income taxpayers footing the bill--with interest--for these tax cuts."

“When the economy is reeling, the most stable form of pay isn’t stocks, it’s cash,” said Sam Pizzigati, an associate fellow at the Institute for Policy Studies in Washington who has written about executive compensation and shareholder activism. “In rough times, the surest thing is cash, and that’s what they went for.”