Democrat members of the budget conference committee are proposing a series of ideas that would help balance the federal budget by ending some existing tax loopholes. The Republicans, as expected, are opposed to these measures simply because they violate the first Republican commandment, “Thou shalt not increase revenues.” (Note: “revenues” is what the right consistently refers to as “taxes”.)
From Grover Norquist’s infamous Taxpayer Protection Pledge to letting the Bush tax cuts expire, the GOP has been 100% consistent on that one fundamental pillar of conservatism. They rally around attempts at tax cuts, (unless they favor working Americans) and stand bitterly opposed against repealing any tax loopholes because that might have the real effect of increasing the amount of taxes certain people pay. And to a Republican, closing tax loopholes is just another word for “tax increase,” which they’ve all vowed not to do under any circumstances.
So exactly what tax loopholes are the Democrats proposing to close? In a November 8th piece from the National Journal they include:
1. End Tax Deductions for Shipping Jobs Overseas
2. Close the Corporate Jet Loophole
3. Close the Carried Interest Tax Break
4. End the John Edwards/Newt Gingrich Loophole
5. Stop Tax Subsidies for Yachts and Vacation Homes
6. Close the “Check-the-Box” Loophole
7. Treat Companies Managed and Controlled in the U.S. as U.S. Companies
8. Tax Risky Derivative Contracts on a “Mark-to-Market” Basis
9. Limit Corporate Deductions for Excessive Executive Stock Options
10. Stop Wealthy Individuals from Playing Tax Games with their Retirement Accounts
11. Defer Interest Deductions Related to Foreign Income
12. Close Estate Tax Loopholes for the Wealthiest Americans
Closing these 12 loopholes, Democrats say, would greatly reduce the impact of, and could possible eliminate the need for the next round of automatic sequester cuts scheduled for January, in the amount of $91 billion.
Most reasonable people would look at this list (full descriptions can be found in the National Journal piece), and say…Yes! There’s nothing not to like in this list. The loopholes proposed don’t even include a rash of the usual oil and natural gas subsidies that the Democrats have been opposing for years.
And yet the Republicans consider this list a “non-starter” in negotiations. Why don’t both sides see this as a no-brainer? Why aren’t Republicans embracing this as an opportunity to work with the Democrats to balance our national budget? Why are we even having this discussion? Everyone involved in this debate admits these tax loopholes should be repealed, and that repealing them would help balance the budget.
The real problem of course, is that today’s Republican party is married to the idea that maximizing profit for corporations and wealthy Americans will help everybody. They remain faithful to this outmoded concept in spite of mounds of evidence that prove an unholy concentration of wealth in the top 1% of Americans, coupled with reports that more than 40% of Americans are now living in poverty. Unemployment is at a crisis level, greatly impacted greatly by American manufacturing jobs being shipped overseas. The money isn’t “trickling down” as predicted.
The Republican response is expected to be, “No new tax revenues ever! We are only open to cutting government programs!” These general policies, better known as “austerity programs,” have devastated European countries recently and are becoming more unpopular with macro-economists.
Sadly, Republicans and even many Democrats are in the pocket of corporations and the wealthy. They annually pocket billions of dollars from these corporate and wealthy sponsors in exchange for their support of issues like the aforementioned loopholes. And they have become so dependent on this tainted money, that they are unable or unwilling to make unbiased decisions that affect the American middle-class. And so the trend of pushing money to the top continues, that money continues to remain at the top, and American suffering is rising daily.