Friday, July 31, 2009

Tax Revision Intended to Enrich the Wealthy

Libby Sholes, of California Church Impact, sent the following message out yesterday. It's a disturbing account of how the Governor of California, and other like minded leaders, intend to dismantle the structures of social support in our society in order to benefit the wealthy. The language of "fairness" is used but it is anything but fair, just, or righteous to require that those least able to bear financial burden are required to carry the same burden as those who have little financial vulnerability. It is not accidental or thoughtless. It is a careful strategy to protect the wealthy while keeping the poor poor.

If two guys go out to move a pile of firewood, and one is very strong, lifts weights, works in a physically demanding field, while the other is not as strong or fit, is it "fair" to require that both men carry the same amount of wood? Should the strong guy sit down when he's done with "his" share and watch the other guy finish the work. It certainly wouldn't be a very good way to get a common task accomplished.

In the Episcopal Church our baptismal covenant includes the promise to "Respect the dignity of every human being." I think that means we have a responsibility to one another. If any American is living in poverty, we are all impoverished. And for that matter, if any human being is sick, hungry, or oppressed, then we all are. The least we can do is not attack those who are already struggling.

In January 2006, I attended the annual Sacramento Press Club lunch with the Governor. Abnormally subdued, Governor Schwarzenegger turned in a low-key presentation since he’d just lost all of his most cherished ballot propositions the previous November. These would have given him unprecedented power over the budget and other items. Voters sent him a resounding “NO” on all issues, much to his chagrin.

At only one point at the Press Club luncheon did the Governor become animated. That is when a reporter asked whether it was true that “the rich carry too much of the tax burden.” The Governor got very excited and agreed that not only was it true, it was entirely unfair that they should shoulder the lion’s share of taxes! He said he would work “to make the tax system more fair so that the middle and lower income classes would pay more of their fair share.”

No one in the room reacted. No one. (Except for me, but I remained well behaved. I’m sorry about that now.) Not one media outlet reported that outrageous statement – and well they should have. The Governor is about to keep that promise.

To understand the context of his tax plan, I highly recommend that you read Jacob Hacker’s The Great Risk Shift and David Cay Johnston’s Free Lunch: How the Wealthiest Americans Enrich Themselves at Government’s Expense (and Stick you with the Bill.) These books are widely available, highly readable – and infuriating. Over the past three decades support for all basic services of our nation and states have already been shifted onto our backs. Those with the greatest means bear the lightest burden.

Then read the Governor’s plan for tax system revision. In conjunction with the Commission on the 21st Century Economy that seeks the same “fairness” for the wealthy that the Governor supports, the Governor wants to call a special session this Fall to assure that we accomplish his vision. You can read the summary at:

To see the current impact of our tax system on middle and lower class people in California, go to the California Budget Project PDF report, “Uncharted Waters” especially pages 11 and 33. It can be found on the first page of their web site,

We are well under way to totally destroying real fairness in our tax system. The state raised “taxes” in California this week, but they did it by gouging those least able to pay. What are cuts in services and increased fees and demands on individuals if they are not invisible taxes? If we eliminate tax breaks or remove services for corporations and the well-to-do, conservatives holler we raised taxes on the rich. Well, that is precisely what our state has done to those already living on the edge.

One Commission on the 21st Century Economy proposal is supposedly “democratic”. That is a flat tax in which everyone would pay the same rate. However, the real outcomes are disastrous. The median family income in California is about $55,000. A 10 percent tax rate would leave $49,500 from which to pay basics, with almost no discretionary income or savings. Someone with $550,000 would be left with $495,000 from which they would cover basics, buy that boat, take trips, clothing, luxuries and save up for college for their kids.

That’s fair? Whatever happened to our notions of a graduated tax? That is based on the very real understanding that the wealthy and corporations get tax breaks the rest of us do not. That they can generate income and riches the rest of us cannot. What happened to “From those to whom much is given, much is required”? (Luke 12:48)

This is just one of a great number of proposals the Commission and the Governor support, all of them designed to push responsibility ever downward on the majority of Californians of modest means. Again, take a look at the summary of the plans:

From now until the Governor and the Commission on the 21st Century Economy get their hooks into us, it is imperative that you speak out against this new “risk shift”. It’s already made the lives of the very poor impossible and dangerous. It will soon impact us all.

Write, call, visit, email your legislators and the Governor! Go to our site for phone, FAX, and emails:

It is especially important to contact conservatives in both parties. Do NOT let the anti-tax people speak for you – it is not in your interest that they press their agenda. This is NOT democratic revision of our outmoded tax system, it is a wholesale rout to free the most wealthy from responsibility to our common good. This is our state, too, and this is our collective well being that is on the line. We must be silent no longer!

Thank you!

Elizabeth Sholes

Director of Public Policy

California Church Impact

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