At some point in the dim, distant past — around the time I was born, just before Dwight Eisenhower took the oath of office — incorporated businesses accounted for 32 percent of Federal tax receipts. By contrast, personal income taxes — not including Social Security and other retirement programs — accounted for 42.2 percent. Things would never be the same.
You might want to look some of this up, if for no other reason than to satisfy yourself that it is the truth. There are those out there who, for reasons of their own, will completely misrepresent the past, who will try to sell you their own version of history.
The fifties were a heady time. The United States had firmly established itself not only as a world power, but as the predominant world power. World War II had been fought largely on foreign soil, and the cost — both in terms of human life and destroyed property and infrastructure &mdash had been borne largely by our allies and our foes. Our economic engine, spurred on by new housing and a manufacturing engine revved into overdrive, was humming along. Things were pretty good, and the future never looked better.
These days, in the desolate landscape that passes for an economy, some of us struggle to find glimmers of home. Some of us. Others struggle to find scapegoats or, at the least, issues that might serve to distract us from the real problem. In the canine world, this is known as the squirrel distraction.
The estimated breakdown for tax receipts in 2011 is as follows: personal income taxes, not including social insurance and retirement receipts, will account for 43.9 percent. Corporate income taxes, however, will account for 9.1 percent.
You will hear certain people howl about the onerous tax burden we place on our corporations, and how this leads them to flee America and set up shop overseas. You will hear certain people howl about this despite the fact that the Corporate share of federal tax receipts has shrunk by 71 percent.
What about the economy since 1952? How have corporate taxes fared when compared with corporate profits? It’s a different picture. In 1952, corporate profits, after tax, were 83.3 billion; GDP was 358.3 billion that year, so corporate profit as a percentage of GDP was 23.2. In 2010, corporate profits were 5633.5 billion and GDP was 14508.2 billion, so corporate profits rose to 38.8 percent of GDP.
Corporate profits rose from 23.2 percent of GDP to 38.8 percent, while corporate taxes fell from 6.2 percent of GDP to 1.2 percent during that period. Individuals didn’t fare nearly as well; their income taxes fell from 8 percent of GDP in 1952 to 7.1 percent in 2010.
There are people who don’t want you to pay attention to these figures, and these people will shout things like “Unions! Those damn union employees still get decent pay and benefits!” in the hopes that you, with your stagnating pay and diminishing benefits, will be tempted to shout “Yes! Those union bastards are still making enough to get by! Cut their pay! Slash their benefits!” This is the modern version of one dog yelling “Squirrel!” to another. The hope is that you will not demand that corporations pay their fair share in taxes; the hope is that you will demand that your own taxes be reduced. The hope is that you won’t notice your own small reduction. The hope is that you will have the standard knee-jerk reaction to the cry of “taxes are too high” and, like most people, won’t even bother to find out if that’s true.
And you know what? So far, it’s working.
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