Old white men wearing dark suits and sporting locks of bright grey hair don’t like change. That’s why whippersnappers who are young, female, beautiful, intelligent, and can bust a move in the hallways of Congress, scare the shit out of them. Most specifically I’m talking about Alexandria Ocasio-Cortez, a major rising star in today’s progressivism. Besides her joy of dancing the old folks don’t care much for her suggested reforms to the nation’s income tax system. What’s got their sphincters in a twist is the 70% income tax she wants to impose on the nation’s wealthiest. If one doesn’t go beyond the 70% figure it is easy for the wealth and power block to lure the average American into thinking the government is coming after their money. Quite the contrary is the case.
During the 1950s, one of America’s most prosperous eras, the top tax on income was around 90% and most people didn’t think much about it. There was little sentiment to cut taxes and make the rich richer because, in part, it was during this era that the middle-class was on the march in America.
Furthermore that 90% was never really 90%. The government didn’t take away 90% of anyone’s money. The rich could and did purchase the services of an army of tax attorneys and accountants to whittle the number to something much smaller. Overall the system was doing pretty well for the nation. A job could last a lifetime, we could afford to feed and educate our children, our infrastructure was exploding, our military was the world’s strongest, the world envied our example and begged for our leadership.
Much of that began to change when Ronald Reagan came to power with the backing of the wealthy. Reagan brought with him this thing called supply-side economics. More commonly known as “trickle down” economics or what George H.W. Bush called VooDoo Economics. Basically, the idea was, cut rich people’s taxes and they will invest the savings in economic expansion and the middle-class would benefit from more jobs and higher wages.
Well, that never happened. The simple truth soon became evident, give a rich man an extra dollar and it will grow moldy in some secret bat cave. There is zero evidence that trickle down ever trickled down. In fact, it didn’t and the victims became the middle-class. Since Reagan, the middle-class has shrunk and the gap between the haves and have nots widened. Just one example would be the cost of attending California State University at Fullerton. In 1966 the in-state cost of tuition and fees was $47.00. For the 2017-18 school year, those same costs have risen to $6,850. Add to that the cost of books, lab materials, food, and housing and students today are faced with something those of my day rarely was, student loans and a life of debt. Add it all up and toss in the interest on student loans and college becomes out of reach for millions of America’s youth.
So where does AOC’s 70% fit in all this? Well, here are some of the basic facts:
- Beginning with Reagan taxes on earned income has been lowered to 37% and exemptions and deductions can lower it much further.
- The Trump tax cut on the wealthy has reduced their burden even less.
- AOC’s 70% is only on earned income and doesn’t kick in until such income reaches $10 million.
- Those affected can still hire their army of accounts to dig out every possible deduction and scheme possible to lover their taxable income.
And furthermore, even with increased taxes on earned income, the revenue generated still wouldn’t come close to meeting the nation’s current and future needs. Programs such as Medicare, Medicaid, and Social Security will still be looking at bleak futures, along with affordable education, universal healthcare, affordable housing, drug addiction, and so much more.
Our economic future looks dark and there few answers beyond keeping America’s wealth in America and taxing it on a fairer and more equitable way. The changes being proposed by the progressives are necessary and aimed at those who can most afford it. A person earning over $10 million a year can still afford a lifestyle you’ll never experience. And worse yet, they aren’t in the least interested in you ever experiencing it. There’ll be no personal moral question over them paying you $7 an hour to press their BVDs.
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Here’s a short video by former Secretary of Labor, Robert Reich regarding much of what I’ve said above. It clearly explains how the rich are getting richer from unfunded tax cuts and how the nation’s debt is skyrocketing. And it’s all happening on the backs of the working people.