Our Real National Pastime – Tom Rossi

Here in the United States, whining about taxes is probably more popular than all of the major sports, combined. Forget about baseball – tax-whining is our true national pastime.

What’s amazing is that the distribution of whining, like so many things, is so illogical. In fact, tax-whining is positively correlated with a person’s or a corporation’s wealth. So, the more you have, the more you whine. It’s sort of like a team in Major League Baseball complaining that, in their run up to winning the World Series, too many strikes were called on their batters.

The favorite topic of tax-whiners is that the top income brackets pay all of the taxes while the bottom half of the so-called “middle class” (nobody want to be labelled “poor”) pays nothing. They love to go on about the 47% – the “takers.” That number was made up, by the way.

As justification, the tax-whiners always point to one statistic… the statistic that makes them look right. Here it is, in graph form:

But this is only part of the tax story. People pay taxes on much more than income. They pay taxes on property, gasoline, and sales tax on purchases of goods. The truth is that, when you add all those taxes up, the bottom 20% of earners pay about 17% of their incomes in taxes, while the top 20% of earners pay about 29%. That’s a significant difference, and I’m sure it frustrates those who live inside a calculator.

But it’s nowhere near the claims that are made, usually by Republicans and Tea Party types. And we should pay close attention to the effect that these percentages have on people. For someone who makes $250,000 per year (for example) paying 29% in taxes means that they are left with $177,500 to live on.

For someone earning 13,000 per year, paying 17% in taxes means that they are left with $10,790 to live on. That’s less per year than what the $250,000 earner has left per month. And, as I’ve argued before, the more money a person has, the more benefits he or she gets from taxes.

To the whiners, I say this: I realized that the prospect of paying an extra $500, or so, in taxes for a year might mean you have to put off buying a house for another month. Or it might mean that your kids actually have to go to public school. Or it might mean you have to buy the Lexus GS instead of the LS. But a difference of even $100 to a family on the receiving end of this shotgun economy might mean that their kids get “new” shoes (maybe from the Salvation Army) when their toes poke out through a hole. Or it might mean that they can afford to heat the house to above 55° in the winter. Or it might mean that they can pay the electric bill for another month or two.

These are two different worlds. What I’m talking about is called “Marginal Utility Theory,” and it’s a part of standard, old-fashioned, neo-classical economic theory. It just gets ignored because it is essentially an “inconvenient truth.” Without putting you to sleep, what this boils down to is that $1000 means nothing to the well-being of a millionaire, but it could mean the world to a poor person, or a poor person’s children.

President Obama and others are in the process of attempting to re-balance the tax code which has, in recent decades, come to favor the rich and the corporations. And now, we have an influx of veterans that often have an incredibly hard time finding a good job – or sometimes any job, for that matter. This is happening while government programs are being cut left and right.

If you really want to “support our troops,” if you are really “pro-life,” then realize that your tax dollars are helping people who really need it. And their health and well-being will come back to benefit you in ways you may not be able to imagine.

-Tom Rossi

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Tom Rossi is a commentator on politics and social issues. He is a Ph.D. student in International Sustainable Development, concentrating in natural resource and economic policy. Tom greatly enjoys a hearty debate, especially over a hearty pint of Guinness.

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ExxonMobil Says Yes to Global Warming – Roger Ingalls

Denier’s walls are crumbling down. It an astonishing speech, ExxonMobil’s CEO Rex Tillerson, admitted that the burning of fossil fuel is warming the planet. Like many others, I was totally floored when reading about his revelation. Perhaps he had a moment of weakness or maybe the perpetual lying finally got the better of him. More likely reputation played a role; let’s face it, the silly-science arguments used by fossil-energy companies are making them look stupid and lacking in credibility.

Can you imagine the look on the Koch brothers’ faces when they heard about Mr. Tillerson’s speech? I bet they soiled their pants from moaning so hard.

Tillerson wasn’t, by any means, apologetic or gracious. He called the public illiterate, the press lazy and indicated that the risk of spills and accidents were worth the reward. The biggest industry challenge, he said, “taking an illiterate public and try to help them understand why we can manage these risks.”

Interestingly, Tillerson appeared to ignore any discussion relating to remedial activities that would curb global warming. I suppose this is not a surprise. Slowing the release of greenhouse gasses would negatively impact ExxonMobil financially since more energy burn means more profits for them. The CEO believes we can manage in a hotter world. “We have spent our entire existence adapting. We’ll adapt,” he said. “It’s an engineering problem and there will be an engineering solution.”

I give Mr. Tillerson credit for stepping up and acknowledging the impact fossil fuels have on the environment but I also find it obscene that these Wall Street-massaged companies go from “denying” straight to “it’s too late, the damage is done so let’s adapt to our new climate”. Again, not a surprise, it’s all about lining pockets with gold but obscenely sinister nonetheless.

As much as I hate to agree with Tillerson, it is too late. Even if we drastically reduced carbon emissions today, temperatures are going to rise and so will sea levels for the next 200 to 300 years. Forget about green or sustainable economies, we need to pursue an adaptive economy that makes today’s disasters tomorrow’s normal.