Should taxes be cut across the board, including taxes on the wealthiest?
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From the pages of In Business magazine.
Welcome to "Political Posturing," featuring opposing views on current issues important to Wisconsin's business community. In this column, Wisconsin Business Alliance Board President Brad Werntz and conservative columnist David Blaska offer their opinions from the left and the right, respectively.
No, no, no — 1,000 times no.
By Brad Werntz
Google the words “Translate No,” and the machine provides about 300 ways to say it. When I saw this I thought, “Man, my work is done, I’ll just type ‘no’ in every language and fill the column word count.” However, it seems that “no” translates most often as a word with an “n” sound added to a vowel sound — “no,” “ne,” “non,” “nyet,” and “nein,” to name a few — and therefore the net result is that “no” sounds something like “no” in almost every language.
So should taxes be cut across the board? Let me just say “no”
Why? Thanks for asking.
In spite of all the hysteria about how rough the rich have it, they don’t need tax cuts. Our top tier income earners are doing just fine, thank you very much. In 1980, when Reagan took office, the top 1% of income earners garnered 8.9% of total income in the U.S. In 2015, the top 1% earned 22% of total income, and this percentage has certainly grown since.
Income inequality is approaching dangerous levels. History proves that when income inequality reaches a certain tipping point, there’s always an adjustment. We’re now approaching that point. By comparison, at the start of the Great Depression the top 1% earned 23.9% of the total income. Taxation didn’t cause the Depression; income inequality did.
Same goes for corporations. While our top rate is higher than the rest of the world at 39%, nobody pays that. Because of the available deductions, the average corporate tax rate is less than half this at 18.6%, which is closer to average for countries like ours. Most very large corporations pay little to no taxes at all.
Some remember the “tax refund” we got from George W. Bush back in about 2002: “It’s your money, let me give it back to you.” Never before had a budget surplus turned into a record deficit so quickly. The result not long after? A recession.
Those who forget history are doomed to repeat it. Those who willfully ignore history are doomed to be remembered as idiots, fools, grifters, or worse. Looks like we’re going to go down this familiar road, and earn a similar outcome, but don’t say I didn’t tell you so.
Brad Werntz is a small business owner in Madison.