The top 10 percent own 85 percent of all stocks, so the 15 percent capital gains tax benefits a large segment of wealthy taxpayers.
It is just silly to argue that raising the capital gains tax back to Clintonera levels (up to 36 percent) is going to “lose much of the capital we need to jumpstart this economy.” American corporations are hoarding $2 trillion in cash that they’re not investing in the economy.
Real GDP grew twice as fast under Clinton than in the 2000s, when we handed out massive tax cuts and didn’t create a single net job. Under Reagan, capital gains were taxed the same as ordinary income after 1986, and America created 40 million jobs between 1980-2000.
Ellis says “The ‘rich’ earn (read income) about 20 percent of the income annually while paying about 40 percent of the taxes annually.” Really? The actual share of income going to the top 1 percent depends on whether you include capital gains income or exclude it (Census Bureau), so the figure varies from “nearly a quarter of the nation’s income” (Nobel economics laureate Joseph Stiglitz) to less than 20 percent. The IRS also estimates that just 70 percent of business and investment income is reported (rich folks cheat a lot), so we really don’t know how much income they have.
The top 1 percent pay 27.6 percent of all federal taxes (Congressional Budget Office) or 22.9 percent (Tax Policy Center), certainly not the bogus 40 percent that Ellis and Michelle Bachmann foolishly claim. This can be compared to the 48.4 percent of all non-home wealth they own.
And yes, Virginia, wealth can be taxed. Economic success in America is predicated on rising incomes of American consumers, but during the past 20 years, the income of the average taxpayer has fallen $400, while the loot of the richest 1 percent soared 33 percent (IRS).
If the rich and corporations are unwilling to invest in jobs, the alternative is higher taxes on them to put unemployed Americans to work with infrastructure jobs (highways, railroads and bridges), and hire back teachers, police and fireman. “Do nothing” is the GOP’s solution.
Tiffee ran as an independent for Congress in 1994
Gazette provides an open forum for the discussion of all points of view
in its Letters to the Editor section. The Gazette reserves the right to
edit letters for length and clarity. Letters can be mailed, faxed,
firstname.lastname@example.org or sent online at okgazette.com, but
include a city of residence and contact number for verification.