Why Taxing Corporations and Wealthy Can Fix our Economy

It has been said that our country is broke, hence the need to cut entitlements that, lets face it, help the lower and middle classes. A recent study by The Institute for Policy Studies released in April this year showed that our country actually is not broke. It lists two reasons why.

One, we have indeed become wealthier than ever. But our wealth has become incredibly more concentrated at our economic summit. U.S. income is cascading disproportionately to the top.

Two, we are taxing the dollars that go to our ever-richer rich — and the corporations they own — at levels far below the tax rates that America levied just a few decades ago. We have, in effect, shifted our tax burden off the shoulders of those most able to bear it and away from those who disproportionately benefit from government investments the most.

Since there are more dollars at the top and the taxes collected on these dollars are at record low levels, this has caused a fiscal tsunami. This report offers both an analysis of our current predicament and a series of proposals that can help open our eyes to a far more equitable — and brighter — future.

Key Tax Facts

• 15,753: The number of households in 1961 with $1 million in taxable income (adjusted for inflation).

• 361,000: The number of households in 2011 estimated to have $1 million in taxable income. The number of households in 2011 estimated to have $1 million in taxable income.

• 43.1: Percent of total reported income that Americans earning $1 million paid in taxes in 1961 (adjusted for 2011 dollars) Percent of total reported income that Americans earning $1 million paid in taxes in 1961 (adjusted for 2011 dollars) .

• 23.1: Percent of total reported income that Americans earning $1 million are likely to pay in taxes in 2011, estimated from latest IRS data. Percent of total reported income that Americans earning $1 million are likely to pay in taxes in 2011, estimated from latest IRS data.

• 47.4: Percent of profits corporations paid in taxes in 1961. Percent of profits corporations paid in taxes in 1961. The number of households in 1961 with $1 million in taxable income (adjusted for inflation). 

• 11.1: Percent of profits corporations paid in taxes in 2011.