Slowly Coming Out Of Hibernation…
Tuesday, October 28th, 2008I have a tendency to retreat into the privacy of my own private den when things are not going perfectly in my life. This is not a good trait. It is not fair to me or my friends. I am sorry, and I am going to work on this trait, so please bear with me. Pun intended. With that said, I am slowly coming out of hibernation, so I will be trying to get back in touch with the rest of society very soon and will be blogging more regularly. As I wake from my hibernation, the bear is apparently pissed.
The fact though is that I have been in hibernation, so I may not have my facts straight. I thought I was waking up in the year 2008, not sometime in the 1940s and 1950s where McCarthy and other fear mongers thought that we can simply dismiss and, in some cases, destroy lives by screaming socialism. I thought that I was taught that a true and strong democracy was based on a battle of ideas. Again, my mind may be a little cloudy due to the hibernation, but surely we have not returned to these tactics of screaming socialism in the year 2008. I almost wish that I was wrong.
The fact is that we are in the year 2008. The fact is that Republicans are now screaming socialism on the campaign trail. This pisses me off. Whatever happened to expecting professionalism and maturity out of adults? I expected professionalism from my secretary, so why can I not expect and demand the same from my politician? Why would the scream of socialism not be professional and not be mature? Simply, it is wrong…the Republicans know that…the Republicans have made the choice to appeal to the worst in humanity by scaring the voting public with emotionally charged words. In full disclosure, I am not voting for Obama…or McCain for that matter, but I do hate it when I am put in a position to completely defend someone attacked unfairly.
This is why it is wrong…
All of this is coming from McCain’s continued use of Joe the Plumber’s question regarding Obama’s tax plan. McCain keeps describing Obama’s tax plan as a redistribution of wealth akin to socialism.
First, read Karl Marx before you call anyone a socialist. Tax plans do not make someone a socialist.
Second, we have a progressive tax system in this country. This is a fact. What does this mean? This means that the more money that you make, the more taxes as a percent of your overall income you will pay. To illustrate this, the tax brackets for a single (unmarried) person in 2008 are the following:
- 10%: from $0 to $8,025
- 15%: from $8,026 to $32,550
- 25%: from $32,551 to $78,850
- 28%: from $78,851 to $164,550
- 33%: from $164,551 to $357,700
- 35%: $357,701 and above
Why do we do this? Because it is fair. Why is it fair? Here is an illustration. Take Person X that is trying to live on $10,000 a year. Person X is poor. Person X is dirt poor. Person X has to worry about basic necessities of food and water, shelter, and clothing at this income level. Person X is in the 15% tax bracket. Now, take Person Y making $200,000 a year. Person Y’s worries are very different. Person Y is not worrying about survival. Person Y has all necessities covered by their large income. Person Y is in the 33% tax bracket. Yes, the percentages of taxes are different, and yes it is fair. But shouldn’t Person X and Person Y pay the same percentage in taxes for it to be fair? Well, we do not have a flat tax in this country. If we were to expect Person X and Person Y to both pay 25%, just to pick a percentage in the middle, more and more people like Person X will not be able to afford the basic necessities of life, eventually becoming dependent on the state for shear survival. In order to avoid this, we ask those of us that can afford to pay more to pay more. The fact is that those of us who have been given an opportunity to make more have the infrastructure, society, and culture that the government helped to create and maintain to thank for it…to some degree.
Obama did not invent the progressive tax system. It is a fact of our society. In the last 100 years, we have never had a flat tax system. The only thing that changes is the steepness of progression. In fact, during WWII, the highest tax bracket was 94%. 94 fucking percent… Surely, this was just because we were in war. Obviously, WWII was the main driving factor to taxes being that high in the highest tax bracket, but the reality is that we have a strong history of high taxation of the rich. To illustrate this, when I was born in 1978, the highest tax rate was 70%.
If McCain is going to complain about a progressive tax plan, you would expect his plan to be a flat tax…right? Nope…Not at all. He is taking his plan completely out of context in order to scare us all. The Tax Policy center compared Obama and McCain’s tax plans. It can be found here:
http://www.washingtonpost.com/wp-dyn/content/story/2008/06/09/ST2008060900950.html
McCain can claim that he will be reducing taxes, but this does not mean that he himself is not guilty of a redistribution of wealth. You see, just because you lower taxes on the wealthy, does not mean that you have created a flat tax where everyone is paying the same percentage of income in taxes. He still is proposing a progressive tax system. He knows this, and he is a hypocrite that is trying to scare voters by screaming socialism.
Another example of him being a hypocrite…McCain voted against Bush’s tax cuts “because of the disproportional amount that went to the wealthiest Americans.” I guess he was in favor redistribution of wealth at that time. Check out the transcript on Meet the Press this past Sunday.
Third, a nuanced fear that McCain is pushing is that Obama’s plan will result in refundable tax credits that would result in the government cutting a check to citizens that actually have no income tax liability resulting in Obama giving welfare to Americans…i.e. – OBAMA IS A BIG SOCIALIST…He is giving money to people that do not pay income taxes…Here is the problem. Our tax system already pays out refundable tax credits to people that have no income tax liability…How can this be? McCain is not pointing out an important factor…People who do not have income tax liability due to low income still pay taxes. How? They still pay payroll taxes…What are payroll taxes? Payroll taxes go to Social Security and Medicare.
McCain’s own tax plan has a refundable tax credit for health care expenses, so he knows that these exist and is even proposing some himself…
More color on this issue can be found at this link:
http://www.politifact.com/truth-o-meter/statements/813/
Finally, still on the tax issue, but less on the socialism issue, McCain wants us to worry that Obama’s tax plans will hurt corporations in this country because the statutory tax rate is not the lowest corporate tax rate amongst industrialized nations. Surely McCain cannot be wrong that corporations would be attracted to countries with lower taxes. He is actually quite right. The problem is that McCain is playing the fear card again because he knows that the American public does not understand the nuances of the tax code. Yep, he is purposely misleading the American voter, and scaring them into voting for him…Country First…I think not.
The nuance is in the concept of the effective tax rate. An effective tax rate refers to the actual rate of taxes paid, not the tax rate written in the statutes. Why would a corporation pay a different tax rate than the ones written in the tax codes? First, corporations have tax offsets that lower taxable income. Second, corporations…are you sitting down?…keep two separate tax books…and this is legal. One tax book is kept to report earnings for the stock market…i.e. – higher earning means that the stock will go up. The other tax book is used to determine how much in taxes the corporations have to pay. How are these tax books different? One way is that the two books use different ways of valuing inventory which drives up earnings or liabilities depending on the method you use. What is the end result? The Government Accountability Office found that 2/3 of all corporations did not pay any taxes between 1998 and 2005…Good times…
http://www.nytimes.com/2008/08/13/business/13tax.html?_r=1&oref=slogin
So where does this leave us? No candidate is perfect. No platform is perfect. However, there is no room for screaming socialism in the year 2008. A democracy is a battle of ideas, so show up and bring some ideas to the table. We need some fucking ideas. What we do not need is diversions of stating that I am putting the Country First while at the same time purposefully and knowingly appealing to the worst in all of us.
Here is the reality…
- A recession is coming.
- We have 2 fucking wars going on.
- We have a disappearing middle class as more and more middle class jobs leave the country leaving us with working class service jobs.
- 3 weeks ago I had friends wondering if they should pull money out of their checking accounts…Seriously, a potential run on the bank. 3 weeks ago I was reliving “It’s a Wonderful Life.”
- Whether you want to ignore all science and say the global warming may not be caused by humans (this is an issue for another time), the world is changing.
- People are losing their homes.
And you want me to tolerate a Red Scare now?
Both plans are progressive tax plans. The fact is that the rich will still be rich, will still be able to live a rich lifestyle, and just because you may pay more taxes if you get rich this does not in any way destroy the incentive system for people wanting to be rich…
McCain is a liar, and he is putting McCain and McCain alone First.

