Corporate freeloaders seize power
by Ross Stephens, from Leawood, Kansas, as a letter to the editor in The Progressive Populist:
In his State of the Union message, President Obama referred to the fact that the tax-rate for corporations in the United States is one of the highest, which is true. What he did not say is, taxes collected from corporations are way below average for developed nations — of 30 countries, only Turkey and Mexico have lower taxes on business. American corporations have an abundance of loopholes and tax abatements; multi-national and foreign corporations hide their profits in the jurisdiction of governments or countries with lower taxes or in no-tax tax colonies. Lobbying and campaign contributions are an incentive for inserting special exemptions in legislation passed by Congress and much cheaper than paying the corporate income tax.
In 1952 the corporate income tax brought in 32.1% of all federal revenue collected; by 2001 it had dropped to 7.6%; and for 2009 was 6.6%. On the other hand, Social Security/Medicare taxes increased from 5.6% in 1952 (before Medicare) to 42.3% of revenue by 2009.
Social Security/Medicare has paid for itself, but in supplanting the corporate tax as the second most important source of federal revenue, trust fund surpluses have been in effect spent for war and national security as the deficit mounts and large corporations pay very little in taxes.
We have turned massive portions of federal services over to corporations. Three-fifths of the monetary outlays of the Defense Department are now outsourced to private corporations; as is the case for seventy percent of intelligence operations, 56% for the Department of Homeland Security, and similar portions of the national security activities for a half-dozen other federal agencies. Two-thirds of all fulltime federal civilian and military employees are in some aspect national security. Total expenditures for war/national security, including servicing war-incurred debt, amounted to nearly half of all federal expenditures just prior to the economic meltdown of 2008. It’s not Social Security and Medicare that are driving up the national debt — it’s war and the massive outsourcing of public services to private corporations that largely avoid paying the corporate income tax. Government waste, inefficiency, corruption, and war combine to increase corporate profits.
Last year the US Supreme Court gave corporations the right to vote with their money in our elections, without limits or disclosure (Citizens United v. Federal Election Commission). A recent study of this “hidden money” gave these funds to the Republicans versus Democrats by a ratio of 21 to one —resulting in a large increase of Republicans in Congress and the States. Because of redistricting and this Court decision, the results of the 2010 election will distort politics for the next decade. I want to know where in the US Constitution and legislation passed by Congress corporations are made legal persons and where legal persons are given the right to vote? Does this case mean American, multi-national, and foreign corporations all have effectively the right to vote in our elections? We should change the Pledge of Allegiance to, “I pledge allegiance to the Corporation and the CEO for which it stands …”