One of my big gripes (in case you haven't noticed) is the ease with which ordinary Americans can be fooled about tax issues by organizations, often ones with greedy purposes of furthering their own interests in lower taxes for themselves, that publish misleading or downright untruthful information and just keep repeating it. This has been a special problem with estate taxes, which hit only the very wealthiest amongst us and for a relatively small amount even for the large estates. It is also true of income taxes in general, the way flat taxes would work, the rationales for the corporate tax and many other key tax policies. Lobbyists frame the issues with inflamatory language, and most are too unknowing about the way tax really works to recognize the ruse for what it is.
Some of the worst phrases that have furthered the cause of cutting taxes for the wealthy so that the majority of Americans can either pay higher taxes themselves or do without the kinds of things that governments, not private enterprises, do best are "death taxes" and "double taxation" .
Much of the estate that is taxed when a decendent passes it along to his heirs as an unearned windfall has never been taxed at all during the decedent's lifetime, in the case of wealthy people with mostly financial assets. If there is not a good sized bite out of the estate upon the transfer to beneficiaries, there'll be very little contribution to taxes from an agglomerate of wealth that has benefited enormously from the US legal system. And the heirs won't have any taxes to pay either--they'll just keep holding and will have a stepped up basis when they sell. All that is is a system for perpetuating or creating oligarchy--letting the wealthy become a ruling class with all the money and all the power without contributing anything much to help pay for the system that made all the wealth possible in the first place.
Similarly, the phrase "double taxation" is used to make people think that taxing corporations is unfair. But the decision about whether we tax entities or not is a reasonable one for societies to make. We made it a long time ago--deciding that we should treat corporations as taxpayers and we should tax capitalist owners of corporations on the income they are paid out of their corporate ownership as well. It is one of the most progressive parts of the federal income tax, and it makes a lot of sense from a democratic egalitarianism perspective. Corporations can horde money and have enormous power because of their ability to lobby for their own benefit. Look at the way Big Pharm and Big INsurance has gotten Max Baucus in their pocket--putting money in his, and getting out of that a watered down health bill that doesn't do half of what we should be doing to move towards a single payer, single provider system like the most advanced countries already have. The presupposition behind the term "double tax" is that you are overtaxing and that you are taxing somebody that shouldn't be taxed. Since Reagan, there has been a huge push by the same economic thinkers that brought us our current Great REcession to undo the US classical corporate tax system. It's really a push for giving more money back to the wealthy and cutting the size of government. But it's all done in the name of economic efficiency--a theory without basis in reality that is probably more to blame for the greed that dominates today's society and the consolidation of huge megafirms--Big Pharm, Big Oil, Big Banks, Big multinationals in general--than anything else.
So I'm glad to see Marjorie Kornhauser's project take off. Maybe others won't agree with me on these pet peeves, but if we have better educated citizens who have more basic knowledge about taxes and how they work, it won't be so easy to bamboozle them into voting against their interest to support tax cuts for the wealthy and service cuts for everybody else while the boondoggles for the big corporations just keep pouring out (like an agreement that the government can't use its bargaining power to get cheaper drugs, or that Big Pharm can prevent generics being sold for 12 years and other crap that is getting put into the "health reform" bill that is becoming, like so much else these days, a corporate giveaway).
What's her project? It's called The Tax Literacy Project--"a non-partisan effort to informally educate the public about taxes through popular methods such as web-based games and other internet activities.
Want to help? Donations are being accepted. What follows is the appeal, direct from Kornhauser and the ASU Foundation.
Money from Taxes Helps Every Person Every Day! But polls show most of us do not understand anything about our taxes. Why should we bother learning about taxes? Because:
Tax ignorance costs each of us money. Many of us pay more tax than we actually owe. Because tax ignorance makes it hard to discuss and enact sound tax policies, we are not able to raise money in the fairest and most efficient manner possible. Why do we need taxes?
Taxes support democracy. They fund government services and goods such as court systems and national defense that protect your life, your property, and your constitutional rights.
Taxes support economic growth. Governments use taxes to encourage economic growth in numerous ways such as maintaining a stable currency, enacting and enforcing laws that protect both workers and employers (their life and property), and helping to build and maintain large and dependable energy, transportation and communication systems.
Taxes support your daily quality of life. They help you and your family buy a house, breathe clean air, have safe food and drugs, travel safely and efficiently on highways, trains, and planes. Taxes help pay for your health care (in the form of tax benefits or direct care) and they pay to educate you and your family. Taxes help you at work (e.g. enforce contracts, provide safe workplace) and help you at play (e.g. national parks).
Become part of a solution to the problem of tax ignorance by contributing to the Tax Literacy Project.
What is the Tax Literacy Project? It is a non-partisan effort to informally educate the public about taxes through popular methods such as web-based games and other internet activities. Can you support the Tax Literacy Project regardless of your political outlook? Yes, the Project’s only purpose is to help provide information about tax, not to support any particular type or amount of taxes. No matter what kind of government people want, that government will cost money. Americans must understand how that money can be fairly and efficiently raised. How can you make a charitable contribution? Make your donation payable to the Tax Literacy Fund at Thank you in advance for your interest and support. For more information or to become involved, please contact the Project Director: Marjorie E. Kornhauser, Professor of Law Sandra Day O’Connor College of Law, Arizona State University [email protected] 480.965.0396 All funds will be deposited with the ASU Foundation, a separate non-profit organization that exists to support ASU. Your payment may be considered a charitable contribution. Please consult your tax advisor regarding the deductibility of charitable contributions.
https://secure.asufoundation.org/giving/online-gift.asp?fid=418 (no appeal code necessary) or Make your check payable to the ASU Foundation and mail to the Sandra Day O’Connor College of Law, Arizona State University, PO Box 877906, Tempe, AZ 85287-7906. Please write Tax Literacy Fund (30004788) in the memo line of your check.
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