Slog
News & ArtsWednesday, February 22, 2012
2012 / Money Socialist Obama Proposes Slashing Top Corporate Tax Rate
Posted by Goldy on Wed, Feb 22, 2012 at 4:02 PM
President Obama introduced a corporate tax reform plan today that would eliminate dozens of loopholes and subsidies from the tax code, while lowering the top corporate tax rate from 35 percent to 28 percent, 25 percent for manufacturers. Both would represent the lowest top corporate tax rate since 1940.
This corporate tax overhaul is allegedly intended to be revenue neutral, but we've seen this before, and we all know how this works out in the long run. Over time, plenty of new tax loopholes and subsidies will be inserted back into the tax code, perpetuating the half-century decline in the percentage of total federal taxes paid by corporations.
Since the federal corporate income tax was first imposed, the top rate steadily climbed from 1 percent in 1909, to 52 percent in 1952, a rate at which corporations shouldered about a quarter of all federal taxes. But after peaking briefly at 52.8 percent in 1968, the top corporate rate steadily declined, settling at 35 percent in 1993 (which technically reflected a 1 percent hike, but with a dramatically higher top bracket threshold). By 2010, corporate America's share of federal taxes had been halved to 12 percent.
By comparison, Mitt Romney is also proposing a vast simplification of the corporate tax code, but with a top rate of 25 percent for all corporations, not just manufacturers. Of course the devil is in the details, but on the surface there's not much of difference between Obama's and Romney's proposals.
Personally, I'd have fewer reservations with swapping a simplified tax code for lower rates, if we could be assured that new loopholes wouldn't just reappear, further eroding corporations' share of total taxes. But history tells us we can't. Which suggests that whoever claims the White House in November, corporate America will once again come out the big winner.
1
Can you say massive Tax Giveaway To The Rich and Corporations while we borrow money for five unfunded wars?
I knew you could ...
I knew you could ...
2
Good. The US has either the highest or the second highest corporate tax rate on the planet. This brings us in line with our European competitors.
3
Unfortunately, and I say this with no criticism intended, your comprehension of the workings of the tax system vis-a-vis corporations and the super-rich, is imperfect (as it is for the vast majority of the American citizenry, and by design).
What Obama, or Warren Buffett, or those disingenuous clownsters who complain on an almost daily basis about the high taxes (yet pay no taxes), this is simply theater.
The chief causal factor in those corporations and super-rich individuals not paying taxes, regardless of what Fox-CNN-NPR-ABC-CBS-PBS say to the contrary, are those unregulated credit derivatives and those off-balance-sheet financial constructs. (Unregulated and off-balance-sheet translates to no taxes paid!)
When the vile scumbag, and wife of Phil Gramm, Wendy Gramm, allowed for the swaps exemption just prior to leaving the CFTC chair position (known as the "Enron loophole") and joining the boards of Enron and Invesco (Invesco??? Isn't that where that Falcone guy....?) it was to allow for a tax evasion/avoidance scheme for the banks and the corporations and the super-rich; equity swaps and total return swaps, etc., exchanged between the major stock holders to avoid paying any capital gains tax.
Next, with Clinton signing that Commodity Futures Modernization Act of 2000, this pretty much deregulated, or made unregulated, all credit derivatives, allow for a dramatic increase and ease of avoiding taxation by the major corporations, thus over 70% of American-based corporations and multinationals pay no federal taxes, and this is most likely and lowball estimate today!
Unregulated financial instruments, based upon securitized debt, and off-balance-sheet offshore fnancial constructs, etc., are what it's all about --- forgedda about those frigging loopholes, and raising or lowering the tax, without altering that, won't make any difference as the corps and people not paying any taxes, will continue to do so.
And that's exactly why congress was lobbied so industriously by Wall Street to keep hands off any regulation of credit derivatives by the so-called Dodd-Frank "financial reform" -- where Mrs. Dodd was with the CME, a clear conflict of interest (as if that exists in America any longer) and Barney Frank's former buddy staffer, returned as chief government lobbyist for Goldman Sachs and handed Barney financial passages he was instructed to put in....AS IS....
Unregulated = untaxed, off-balance-sheet = off the books.
'Nuff said.....
More...
What Obama, or Warren Buffett, or those disingenuous clownsters who complain on an almost daily basis about the high taxes (yet pay no taxes), this is simply theater.
The chief causal factor in those corporations and super-rich individuals not paying taxes, regardless of what Fox-CNN-NPR-ABC-CBS-PBS say to the contrary, are those unregulated credit derivatives and those off-balance-sheet financial constructs. (Unregulated and off-balance-sheet translates to no taxes paid!)
When the vile scumbag, and wife of Phil Gramm, Wendy Gramm, allowed for the swaps exemption just prior to leaving the CFTC chair position (known as the "Enron loophole") and joining the boards of Enron and Invesco (Invesco??? Isn't that where that Falcone guy....?) it was to allow for a tax evasion/avoidance scheme for the banks and the corporations and the super-rich; equity swaps and total return swaps, etc., exchanged between the major stock holders to avoid paying any capital gains tax.
Next, with Clinton signing that Commodity Futures Modernization Act of 2000, this pretty much deregulated, or made unregulated, all credit derivatives, allow for a dramatic increase and ease of avoiding taxation by the major corporations, thus over 70% of American-based corporations and multinationals pay no federal taxes, and this is most likely and lowball estimate today!
Unregulated financial instruments, based upon securitized debt, and off-balance-sheet offshore fnancial constructs, etc., are what it's all about --- forgedda about those frigging loopholes, and raising or lowering the tax, without altering that, won't make any difference as the corps and people not paying any taxes, will continue to do so.
And that's exactly why congress was lobbied so industriously by Wall Street to keep hands off any regulation of credit derivatives by the so-called Dodd-Frank "financial reform" -- where Mrs. Dodd was with the CME, a clear conflict of interest (as if that exists in America any longer) and Barney Frank's former buddy staffer, returned as chief government lobbyist for Goldman Sachs and handed Barney financial passages he was instructed to put in....AS IS....
Unregulated = untaxed, off-balance-sheet = off the books.
'Nuff said.....
4
I'd gladly give up the corporate tax entirely in exchange for doubling the top personal income bracket and capital gains rates.
5
I would expect this proposal to go nowhere. The Dems wouldn't support lowering the corporate tax rate without the loophole elimination, and the Repubs won't support the loophole elimination for fear of being painted as having "raised" taxes by Grover Norquist and the likely Tea Party challeng that they'd see in their own primary.
I think this is just good politics by Obama - it eliminates a talking point for the Republicans who bitch about how American companies are hindered by an onerous corporate tax rate when compared to foreign corporations.
I think this is just good politics by Obama - it eliminates a talking point for the Republicans who bitch about how American companies are hindered by an onerous corporate tax rate when compared to foreign corporations.
6
Anybody who expects Obama to do things differently during a 2nd term is bound to be sorely disappointed. The good part is that it's not too late to vote for 3rd party candidates or at least making sure they are on the ballot.
8
Not just a giveaway to the extremely wealthy. Dayyym, at 25% I might just reform my LLC into an S-Corp....
9
@7 If you are claiming that 3rd parties have never influenced national politics, I suggest you crack open a history book.
12
@9, everyone agrees that third-party candidates have affected US politics. Just not in a good way (i.e., in favor of what the third party wants to happen). Right or center-right candidates damage the right; left candidates damage the left. Please stay at home.
13
This is absolutely the smart thing to do. American corporate tax rates are close to the highest in the world. Trying to close loopholes while keeping taxes high to punish business? That's not smart economically or politically.
14
Every true reformist should be advocating the near elimination of all centralized taxes. The taxes are what creates the inequities. The hot shots got that way from subsidies.
15
@4, yes.
Third-party candidates will simply pare off some of the Dem vote (as happened with $@&&!! Nader). The Republicans are too shrewd to let any of their ideological slaves escape the party during election year. You need at least FOUR parties, not three.
Third-party candidates will simply pare off some of the Dem vote (as happened with $@&&!! Nader). The Republicans are too shrewd to let any of their ideological slaves escape the party during election year. You need at least FOUR parties, not three.
16
@12, without a left opposition, the Democratic wing of the corporate party will keep drifting right, as shown by the last 30 years. Not building a social and POLITICAL movement in opposition to neoliberal politics is suicide for the left, so I am not sure what you are talking about.
20
@ 16, no, the left needs to JOIN the Democrats. Being outside the Dems drives the party to the RIGHT, especially in light of the GOP's takeover by absolute loons. The "traditional" Republicans are joining the Democrats now.
There may be a situation where a new left-wing party forms and the GOP's implosion makes the Democrats the party on the right. But that's pretty unlikely at this point. More likely, a new conservative party will form, and if lefties remain outside the Democrats, you'll only have a weak left and a strong right in politics.
There may be a situation where a new left-wing party forms and the GOP's implosion makes the Democrats the party on the right. But that's pretty unlikely at this point. More likely, a new conservative party will form, and if lefties remain outside the Democrats, you'll only have a weak left and a strong right in politics.
21
@ 17, Nader took 5% of the overall nationwide vote. How many of those votes would have been for Gore, especially in Florida?
Nader handed the presidency to Bush. That's a fact.
Nader handed the presidency to Bush. That's a fact.
22
Correction: Nader received 2.74% of the national vote. But in Florida, where it all came down, he got over 97,000 votes. So the point still stands.
24
@23, Pardon me, but believing that giving another blank check to Obama will somehow stop 30 years of Democrats drifting rightward is the definition of being clueless. You didn't even manage to promote a primary challenge and you think the independent left will join you? Let me take this back, it's not being clueless, it's being delusional. In the meantime, don't choke on this: http://blackagendareport.com/content/bla…
25
@ 24, if you want to talk to an adult, answer my posts 20-22.
An "independent" left is an ineffective left.
An "independent" left is an ineffective left.
26
Wow, regurgitating the Nader thing again. It's a whole different world since then and if you're going to ignore distant history (like the times when a strong independent "left" effected changes in the party system) you might as well throw out 2000, too.
But let's say we want to be simplistic and ignore nuance. Let's just bring up that one election. Why does one only focus on the votes? What about the fact that there was institutional disenfranchisement (remember the butterfly ballot's confusing design helping seniors vote for Pat Buchannan instead of Gore?), the Supreme Court's illegitimate decision, the fact that Gore from the outset did not even pursue his case vigorously and to maximal benefit, the fact that 12,000 Florida Dems voted for Bush (but Naderites are SOLELY responsible!), etc. It might've also helped if Gore were a decent candidate.
The fact that you want to continually blame Nader for what Bush did is pathological scapegoating.
But let's say we want to be simplistic and ignore nuance. Let's just bring up that one election. Why does one only focus on the votes? What about the fact that there was institutional disenfranchisement (remember the butterfly ballot's confusing design helping seniors vote for Pat Buchannan instead of Gore?), the Supreme Court's illegitimate decision, the fact that Gore from the outset did not even pursue his case vigorously and to maximal benefit, the fact that 12,000 Florida Dems voted for Bush (but Naderites are SOLELY responsible!), etc. It might've also helped if Gore were a decent candidate.
The fact that you want to continually blame Nader for what Bush did is pathological scapegoating.
Advertisement
Most Commented on Slog
-
Hating People Doesn't Make Them Thinner by Jen Graves
-
Los Angeles Gay Bar Bans Bachelorette Parties Until Marriage Equality Is Attained by David Schmader
-
Fill in the Blank by Grant Brissey
-
This Reminds Me of the Great Calculator Scare of the Late '70s/Early '80s by David Schmader
-
Idiot Tries to Defend Bigoted Anti-Gay-Marriage Preacher on Anderson Cooper by Paul Constant
-
The Sunday Morning News by Unpaid Intern
-
Six Moms with Too Much Time on Their Hands and a Shitty Website Decide to Fight Gay Superheroes by Paul Constant
-
The Saturday Morning News by Unpaid Intern
-
What the Hell Is Wrong With Seattle's Pride Parade? by Dominic Holden
-
Why Mayor McGinn's Wife Canceled Her Family's Seattle Times Subscription by Eli Sanders
RSS
Facebook
Twitter
Comments (26) RSS