Category Archives: Taxes

Blog: Blast from the Past: The Reality of Tax Breaks

Blog: Blast from the Past: The Reality of Tax Breaks

Eric Gibble
Oct 24, 2011

As those in Congress continue to debate solutions to stabilize our economy, we must be cognizant and reflective about past policies that have failed the American people. After all, those who forget history are doomed to repeat it. One of the solutions on the table is to cut taxes for the super-rich in order to spur job creation.

Our government is cutting essential services utilized by the people to put themselves back on their feet and lead a healthy, stable life. We should be providing for those who have too little. Yet our nation is putting more in the pockets of those who have more than enough. This idea goes against our core American, and Catholic, values.

We know that tax cuts have done little to help the middle class and the most vulnerable in our society. But that wasn’t what we were hearing in 2001 when the Heritage Foundation was supporting the first round of tax cuts. According to the conservative think tank’s 2001 “The Economic Impact of President Bush’s Tax Relief Plan” report:

  • They said President Bush’s tax plan would boost economic activity and over 1.6 million would be working at the end of FY 2011.
    What really happened?  In 2001, 6.8 million Americans, at a rate of 4.7%, were unemployed. Currently, there are 14 million Americans unemployed at a rate of 9.1% according to the U.S. Bureau of Labor Statistics. The numbers are clear – 1.6 million jobs were not created.
  • They said the plan would reduce excess tax revenue and effectively pay off the publicly held federal debt by FY 2010.
    What really happened? Our public debt now exceeds $14 trillion, and the Bush tax cuts of 2001 and 2003 account for 13% of it. By 2019, the tax cuts are projected to account for 50% of our debt according to the Center on Budget and Policy Priorities the tax cuts are projected to account for 50% of our debt according to the Center on Budget and Policy Priorities.
  • They said $568 billion in new revenue would be created.
    What really happened? The Congressional Budget Office expects revenue to be just 14.8 percent of G.D.P. this year. Revenue has averaged 18 percent of G.D.P. since 1970 and a little more than that in the postwar era.

While we experienced events like the Sept. 11 attacks and the 2008 financial meltdown that had a devastating effect, the Bush tax cuts certainly did not relieve the resulting economic downturn. For the sake of maintaining our social safety net programs like SNAP that deliver critical aid so that those in poverty can feed themselves, we must let the flawed Bush-era tax cuts expire next year.

Blog: Putting Tax Rates Into Historical Perspective

Blog: Putting Tax Rates Into Historical Perspective

Page May
Jul 06, 2011

From Remapping Debate–

At a time when both the President and his GOP adversaries are looking to lower income tax rates, it is helpful to get some historical perspective — a process that quickly reveals that federal income tax burdens are near post- World War II lows.

Users of this tool will be able to make a host of observations. Two that Remapping Debate have noted: the halving of the tax burden from 1945 to 2011 for a married couple with taxable income (in 2010 dollars) of $1,000,000 saves that couple more than $340,000 over the tax bill that they would have had to pay back in 1945. A similar percentage reduction in tax burden for a married couple with taxable income (in 2010 dollars) of $30,000 saves that working class couple only about $3,350 over the 1945 bill.

Check out this great, interactive resource here!

Your Federal Taxpayer Receipt

Your Federal Taxpayer Receipt

By Page May
July 07, 2011

In his State of the Union Address, President Obama promised that this year, for the first time ever, American taxpayers would be able to go online and see exactly how their federal tax dollars are spent. Just enter a few pieces of information about your taxes, and the taxpayer receipt will give you a breakdown of how your tax dollars are spent on priorities like education, veterans benefits, or health care.

Click here to use this tool and see your receipt.

Blog: I Want to Respect Our Leaders

Blog: I Want to Respect Our Leaders

Marge Clark, BVM
Jul 13, 2011

Yesterday I wrote a letter to members of the House and members of the Senate expressing concern about the tremendous perils facing our nation as administration and congressional leaders continue to struggle (or play political games) with the full faith and trust in our nation. Moments later, I was appalled to read Senator McConnell’s statement, “…I have little question that as long as this President is in the Oval Office a real solution is probably unattainable,” (Congressional Record, July 12, 2012, p. 4495) as he laid out his plan for a three-tier rise in the debt limit.

This plan would be difficult, as votes would be required at each stage. It would be no more moral than the current Republican stance (taxes are not to be a part of the solution) as this is a contingency in the three-tier plan also. They continue to hold that the only solution to the deficit problem – which holds hostage the nation’s ability to avoid default on any of our debts – is cuts to programs which predominantly assist those living in poverty to live with some measure of dignity.

Senator McConnell’s statement yesterday about the President harkens back to his oft repeated statements earlier this year that his main goal in the next two years is to ensure that this is a one-term President.

Holding firm on “no taxes” is a political move, directed toward gaining votes from those who mistakenly believe that the President’s goal is to significantly increase their taxes—now while we are perhaps edging toward recovery from the second deepest recession in recent history. It is a stance he hopes will ensure that President Obama is not reelected in 2012. Whether the President is reelected or not should be based on reality, not on seductive, easy-to-remember falsehoods.

It becomes more and more difficult for me to respect some of those in leadership.

Mind the Gap! Petition delivery to the White House

Mind the Gap! Petition delivery to the White House

By Jean Sammon
July 28, 2011

NETWORK staff delivered the petition for a White House summit on the wealth gap to the White House on Monday July 25. We met with Jon Carson, Director of the White House Office of Public Engagement, who actually was very engaging! We presented him with the petition, the list of 6170 names of people who signed the electronic version, including their comments, and the paper petitions signed by another 200 people. We had signatures from each of the 50 states, the District of Columbia, Puerto Rico, Guam, Palau, and the Marshall Islands.

Jon Carson's office in West Wing

In our conversation with Mr. Carson, we were please to see the he understands the importance of this issue.  We talked about how the wealth gap relates to the current debate on the debt crisis, and he was very interested in what we were hearing from people around the country. He stressed how important it is for constituents to make personal contact with their elected representatives. Even if elected officials won’t always admit it in public, constituents do have an influence on their behavior.

One of the nice surprises was that Lauren Dunn joined us in the meeting. Lauren was a NETWORK associate in 2006, and is now working with the White House Domestic Policy Council. She told us that the people in her department are working to increase opportunity for people at the low end of the wealth gap.

We will follow up with Jon Carson and Lauren and others at thNETWORK staff at White Housee White House on the idea of a summit on the wealth gap. We still intend to meet our goal of 10,000 signatures on the petition, and we will deliver all of them in future meetings, as we continue to educate elected officials as well as the public on the causes and consequences of the wealth gap in our country, and advocate for responses.

If you haven’t signed the petition, please do so athttp://www.networklobby.org/petition-white-house-summit. If you have already signed, please forward the link to others and ask them to sign.

Blog: The Budget Reflects Our Values

Blog: The Budget Reflects Our Values

Fr. John S. Rausch
Mar 20, 2011

Last February when the U.S. Catholic bishops wanted to underscore the morality involved in budget priorities, they asked Stockton Bishop Stephen Blaire to write members of Congress.

“On behalf of the United States Conference of Catholic Bishops,” he wrote as chairman of their Committee on Domestic Justice and Human Development, “we call on Congress to place the needs of the poor, the unemployed, the hungry, and other vulnerable people first in setting priorities in the Fiscal Year 2011 Continuing Appropriations Resolution.”

His comments drew strident criticism from numerous Catholics admonishing him and other bishops to steer clear of political involvement and to see their job as saving souls, promoting subsidiarity and avoiding socialism. Eventually, the budget axe did chop fingers and toes, sometimes arms and legs, off the programs championed by the bishops.

Church-going people easily get wrapped in discussions about deficits and debt framed around individualism and entitlements. Many ask: hasn’t individual freedom created the wealth in America? Don’t billionaires and mega-millionaires need tax cuts to create new jobs? Won’t entitlements bankrupt the U.S. in the future? Admitting no simple answers, these types of questions distract from the deeper questions and fuel the wrangle that is polarizing the country.

For people of faith the bishops are right to flag the morality of budget priorities. A budget actually reflects society’s values. It quantifies the importance of what to cut and what to cultivate. But, the bishops’ perspective rests on the common good and the enhancement of community, not simply the enrichment of the individual. In essence, the budget process asks what kind of community we want to promote.

For three decades the U.S. has experienced a redistribution of wealth–upward. Between 1979 and 2008 the top 1 percent saw their income increase by 224 percent, while the bottom 20 percent experienced a 7 percent loss in theirs. Currently, the top 1 percent get nearly a quarter of the nation’s income and control 40 percent of the wealth. Just 25 years ago that top group held 33 percent of the wealth and took 12 percent of the nation’s income. The result: society today mirrors the inequality just prior to the Great Depression.

Observe: with wealth comes power. Translated into politics, the super-rich can inordinately influence legislation and special interest tax breaks. Lower tax rates on capital gains, largely benefitting the super-rich, shift the tax burden to other sectors of the economy, or beg for budget cuts. These cuts, together with free trade agreements sucking manufacturing jobs overseas, force “the poor, the unemployed, the hungry, and other vulnerable people” whom the bishops want to protect, to face their own financial tsunami.

The mantra “Smaller Government, Less Taxes” fits easily on a bumper sticker, but the average total U.S. income tax rate (combining federal, state and local) ranks lower than 24 other industrialized nations.  Bank of America paid no U.S. income taxes in 2009 & 2010.  Boeing, recording profits of $9.7 billion over the years 2008-2010, actually received a tax rebate of $75 million during those years.

A vibrant democracy requires healthy educated citizens who can participate in the political process. A tax system based on the ability to pay–favored by popes and bishops for over a century–will raise the revenue so everyone can have a place at the table.

Should Congress cut funding for Head Start, the Women, Infants, and Children nutrition program, the Global Health and Child Survival Account, Hunger Free Communities Grants, or the Peace Corps?  People of faith ask: do these programs reflect profligate spending, or our better angels?

Blog: Standing Together for Economic Justice

Blog: Standing Together for Economic Justice

Simone Campbell, SSS
April 14, 2011

I am grateful that President Obama spoke out yesterday about what is at stake in our nation. I agree that we as a nation need to focus on the thread of our relationships that bind us together into community. As he noted, it is tempting at times to think that we live this life alone and we get what we earn individually. But the truth is that we are interdependent. The top 1% of our population who have amassed so much wealth over the last 30 years are totally dependent on the workers in the country for creating that wealth. We are all dependent on the transportation and educational systems that have enabled us to build our nation. We are all dependent on these systems supported by our tax dollars.

In order to protect their wealth, I believe that the richest folks should be interested in a real safety net that allows for low wage workers to live in dignity. Social Security and Medicare are two programs that keep senior citizens who have worked all of their life out of dire poverty. This is a program that is necessary because employers neither pay enough to allow workers to save for their retirements nor provide healthcare benefits once they do retire. These two programs, paid for by workers, need to be protected from short sighted politicians who want to trash them for quick political gains. The wealthy should say no to this and certainly the rest of us should too.

I was glad to hear President Obama say that our nation is called to integrated sense of the common good into public policy. I would have gone farther and said that it is time workers received salary increases and that our faith calls of “those who have two coats to share one with those who have none.” I would add that those who have two houses, two cars, two boats, etc., are in the best position to invest in our nation. It is a good faith practice, but it also is needed to keep our country strong. The president articulated a good beginning, but we must do more to ensure that billionaire campaign contributors do not have an iron grip on the soul of our nation. Rather, it is the broad 90% of us that know we must stand together and invest in our future. This is a plan and a tax policy that makes sense.

Blog: The Good News about Taxes

The Good News about Taxes

By Casey Schoeneberger
April 15, 2011

Taxes are the means with which we all work together towards a greater good. With so much confusion and scornful rhetoric surrounding our taxes, however, it is no wonder they end up being more despised than loved. As a result of that confusion and rhetoric, America now faces record low revenues combined with the problem of enormous deficits.

Tax season is the perfect time to examine exactly where our federal taxes are spent and thankfully, The National Priorities Project provides the ideal tool to find those answers.

This tool demonstrates where taxes paid by your type of household (single, single head of household or married filing jointly)—and with your  specific tax responsibilities are directed. You can check where your tax dollars go by using this tool. You’ll get a chart similar to the one below that shows how much an individual would pay towards each budget area.

In the example below, as a single head of household with one child, earning $50,522 in 2010, my federal tax contribution would equal approximately $3,586. When you break that down into individual categories (as seen below) my federal contributions to Veterans Benefits through my taxes would equal a mere $139 while my tax dollars contribute $982 to military expenditures. In no way do I advocate for jeopardizing the safety and security of our military, but this skewed chart does speak to our national priorities. As much as we may be investing in our military, we are certainly not dedicating those same resources to soldiers when they return from service.

As much as we invest in the defense of our nation, we will never be secure if we continue to cut investment in international affairs programs that work to build understanding and consensus among nations. With my hypothetical tax bill, I’d contribute $43 a year to international affairs. Our country may never agree on where each dollar should be directed, but I do believe a majority of Americans would contribute more than $40 to peaceful development in other nations—before conflicts arise that demand military intervention.

chart

Take a look at this tool and see where you’d be willing to spend more (or less) of your tax dollars.

Source: National Priorities Project

To see a further breakdown of the above categories, click here.

Blog: Please, Stop Calling Me a Taxpayer!

Please, Stop Calling Me a Taxpayer!

By Mary Georgevich
April 18, 2011

Recently, I’ve been doing a lot of thinking about the way we talk about citizenship in this country. Especially when it comes to taxes and citizenship.

Does it bother anyone else that we’re now referred to as, “taxpayers” instead of “citizens?” I hate it. It seems an attempt to make me feel like a consumer and the government should give me great customer service. I’d like to think that my contributions to my country go much farther than the check I send on April 15 every year.

My father and I were having a discussion about unions when he came to visit earlier this month, and he said something that I think is valid. “Unions got greedy,” he said. I think that’s true to an extent. But I think we could substitute any number of nouns for unions, and it would still be true. “CEOs got greedy.” “Lawyers got greedy.” “Doctors got greedy.” “Professional athletes got greedy.”

Malcolm Gladwell wrote a piece in the New Yorker where he makes this point: at some point in the 20th Century, people asked for what they could get instead of what they deserved or needed. (I’d link to the article, but unfortunately, it’s behind a paywall).

Bonuses are now like encores at concerts: expected, not special rewards for a job well done. Salaries keep climbing, regardless of actual performance, and the rich continue getting richer, even when they have to lay off workers to pay for those raises.

Americans, even those who are falling further and further behind, have come to believe that bonuses for the wealthy, or increasingly generous tax loopholes, should be the norm. And this type of thinking has affected the way we think and talk about taxes. People seem to believe that they should do everything they can to minimize the amount of taxes they pay.

But is it right? And should it continue? There’s been a lot of focus on General Electric right now, because itappears they’ve taken advantage of the complexity of the tax code to avoid paying their fair share. But they aren’t the only ones. It’s become a common practice across industries to take money that would be spent paying taxes to provide better roads, schools and other services and instead pay lobbyists and accountants to help companies avoid having to pay taxes.

What if we just accepted that taxes are necessary and good? What if we were to stop thinking that no money is enough, and started asking for what we need, instead of what we think we can get? I’m happy to be a citizen of the United States. I get clean water, sturdy roads, and I received a great education. I also know that during the worst economic downturn since the Great Depression, SNAP benefits helped keep families from starving. So I hope the taxes I paid in 2010 will help keep those benefits coming for all citizens.

Blog: Taxes Off the Table?

Blog: Taxes Off the Table?

Simone Campbell, SSS
May 06, 2011

This morning I read the headline “Boehner Says Only Taxes Off the Table in Debt Reduction Talks” and was once again outraged. The continuous Republican posturing about taxes is really about their recklessness a decade ago. In the Clinton years, when the deficit was an issue, tight federal spending and a boom economy created budget surpluses. The Republicans then immediately “forgot” that the surplus money was to be used to pay down debt and save for when the baby-boomers retired. So what did they do? They enacted sweeping tax cuts that primarily benefited the wealthiest in our country. These policies continued to shift wealth to the top. Then the Bush Administration entered the US into two wars without doing anything to pay for them. It is these actions that have principally created the mess we are in today. The fact that the Speaker Boehner wants to protect the wealth of his campaign contributors is understandably loyal to them, but disloyal to the country. It makes me wonder if the debt issue is really such a problem or only a political tempest in a tea cup. From my perspective it is a problem that needs to be addressed responsibly. This means that revenue (taxes) and spending need to be on the table. It is irresponsible and unpatriotic to do otherwise.