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Saturday, June 11, 2011

Michelle Bachmann takes the lead in promoting income inequality

First Paul Ryan proposed lowering the corporate income ta to 25%. Tim Pawlenty doubled down and suggested 15% along with eliminating capital gains and the estate ta completely. In the race to the bottom, or the far right which is really the same thing Michelle Bachmann staked out new territory. She wants the corporate ta rate lowered to 9%. That alone will cost $2 trillion over the next decade. She all for eliminating capital gains (68% of which are paid by the top 1%) and the estate ta (paid by 1/4 of the top one percent). God knows, Paris Hilton needs a break.

She also wants the 47% who don't earn enough to pay taxes to offset her largesse to the super wealthy.

Her main goal is to get tax rates down with a broad-based income tax that everyone pays and that “gets rid of all the deductions.” A system in which 47% of Americans don’t pay any tax is ruinous for a democracy, she says, “because there is no tie to the government benefits that people demand. I think everyone should have to pay something.”

Actually that 47% pay taxes in the form of payroll taxes, sales taxes and local taxes but then Bachmann is never one for facts. The Bachann's of the world complain that the rich pay too big a share of taxes. That because they have gamed the system and over the past couple of decades have increased their share of earnings disproportionately while income for 90% of Americans has remained static.

This doesn't create a healthy economy. America's greatest period of economic gain was in the post war years when income gains were spread among all stratas of society. Taxes were higher yet economic growth was far more robust. Maybe lower taxes don't correlate with economic growth the way current GOP tax cutting fanatics would want to believe.

Witness recent reports from Walmart, a canary in the coalmine company if ever there was one. They are reporting far lower sales of everything but basic essentials towards the end of the month. Demand is lower for everything else save items that the wealthy buy. When half or more of the population are cutting back on everything but essentials, the economy can't grow even if you eliminate all taxes for corporations. That basic logic escapes the right.

I am well aware that the GOP doesn't want the economy to grow as long as Obama is in office but it has gone beyond that. Cutting taxes and cutting the deficit on the backs of the less fortunate has become a religion that cannot be violated under any economic circumstances. If Michelle Bachmann were to have her way, the economy would continue to wither while the income gap will approach third world proportions. This is not America, or at least the America that became the greatest nation.

For a comparison red this NY Times article about Germanywhere Unions remain strong and the government and ensures that relative wealth remains proportional. Needless to say Germany is coping a lot better with the world's current economic circumstances.

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