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Friday, April 22, 2011
Boomer with Attitude / News Be like Reagan: Raise corporate taxes
Posted By John Grooms on Fri, Apr 22, 2011 at 12:38 PM
More and more people are getting mad about tax-dodging corporations, and with good reason. We’re told that the federal deficit is a danger to the nation’s economy, and yet it seems that nearly every day we hear that some super-major, gi-normous, unimaginably wealthy corporation has gotten away with paying zero taxes — and in many cases, actually got millions, even billions, in “tax benefits,” such as GE’s $3.2 billion gift from you and me. If it’s not General Electric, it’s Bank of America. If it’s not Bank of America, it’s Exxon Mobil. Or Chevron. Or Boeing. Or Goldman Sachs. Or Citigroup. Or some other behemoth whose execs think they’re not obligated to pitch in to keep things going, like the rest of us.
So surely the spiffy deficit-cutting plan from the new GOP House leaders in D.C. will raise corporate tax rates, right? Yes, I'm joking. The truth is that, besides phasing out Medicare (which is something that even 70% of Tea Partiers oppose, for Pete’s sake) and cutting out the pittance given to those money-eating liberals at Planned Parenthood and NPR, the GOP plan calls for lowering the deficit by ... you guessed it ... lowering corporate tax rates even lower. The excuse for cutting corporate taxes, of course, is the same old wishful-thinking/lie we’ve heard over and over: “Give the rich more money and they’ll create new jobs.” Well, no. No, they don’t. Maybe that’s how it worked in olden, semi-mythical times when corporate bosses felt a modicum of responsibility toward the society that gave them the chance to get rich. But all you have to do is look where we are today after eight years of the “Bush tax cuts” for the super-wealthy to figure out that corporate responsibility toward society and creating jobs is pretty far down on the corporate priority list.
Well, enough of this crap. I say that if conservatives revere Ronald Reagan and find inspiration from him, well, how about being like Reagan, and raise corporate taxes when they’re needed? This will come as a surprise to those who get their Reagan anecdotes from the Tea Party/Libertarian fantasy mill, but Reagan, who lowered corporate taxes early in his administration, found that, by 1986, a horde of big corporations, including his former employer, GE, were paying zero federal corporate income taxes. “I didn’t realize things had gotten that far out of line,” Reagan told Treasury secretary Donald T. Regan, as told in the latter’s 1988 autobiography.
President Reagan then undertook a serious tax reform effort, culminating in the 1986 Tax Reform Act that raised corporate taxes and closed a large number of loopholes that had let big corporations dodge paying what Reagan termed “their fair share.” Yes, that Ronald Reagan. As if to emphasize it again, during the signing ceremony, he explained that the reason for the new law was to make sure “that everybody and every corporation pay their fair share.”
Unfortunately for America, Reagan’s heirs at the head of the Republican Party don’t see corporate responsibility in the same way. Newt Gingrich, for instance, as reported by Think Progress, said we should “celebrate” corporate tax dodgers; while Minnesota governor and presidential candidate Tim Pawlenty, when asked about Bank of America's tax-dodging, replied that corporate taxes are too high anyway. Here's what Reagan thought about it, in a video of speech upon raising corporate rates:
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