Every study of taxes and taxation has been virtually unanimous that GOP presidential contender Mitt Romney got it dead wrong that millions of poor and working people pay no taxes and in essence leech off the system. The taxes that the 47 percent that Romney blew off as tax losers pay are for Medicare, Social Security, payroll taxes, and excise taxes. They pay a far higher percentage of the state taxes than the top 1 percent of income earners in nearly very state, as well as sales taxes. Even the number that supposedly pay not a dime in federal tax is badly overstated. The Urban Institute-Brookings Tax Policy Center whittled the number down to 14 percent of households that paid neither federal income tax nor payroll tax in 2009. Even this is misleading. The Center for Budget and Policy Priorities found that between 1989 and 2006 more than half of the tax filers who received the Earned Income Tax Credit received it for no more than a year or two at a time and generally paid substantial amounts of federal income tax in other years.
It's not solely a matter of splitting hairs over dollars and cents and percentages that pay and don't pay to. The poor and lower income workers pay more than Romney for several well calculated reasons. There are too few rich people, who pay too little taxes, and while the government bills still have to be paid, they continue to rise. This is more than simply a case of armies of corporate shilling tax lobbyists that rig the tax system to insure that the rich duck and dodge their fair share. The poor have always been viewed as a ready, easy, and accessible piggy bank for state and federal governments to pay their always increasing bills.
The prevailing thinking is that workers consume while the rich and corporations (their employers) produce. In other words they produce the capital that fuels the engine of commerce and that in turn fuels the engine of government, so therefore the tax burden for every type of consumption fee from food to gasoline, must be borne by the poor and workers. Romney may have been "inelegant" as he put it in stating this, but he has hit on that theme repeatedly on the campaign trail. That government is a major impediment to private industry revival and expansion. His answer is even less taxes on the rich and corporations and though unstated since it would be the political kiss of death in an election year to openly say it, that the poor and workers must bear even more of the tax burden to make up for the shortfall.
This is what happened when Reagan slashed taxes (prematurely it turned out and had to increase them later). Bush Sr., despite his disastrous campaign promise that there would be no tax hike on his watch then promptly turned around and reneged on that promise once in the White House, did the same. They shifted upward the tax burden even more to the workers. The two Bush tax cuts had the same effect. The rich paid even less and the tax burden shifted upward again to the poor and workers. According to David Kay Johnston, "In 2008 nearly one in every 200 high-income taxpayers paid no federal income tax, up from about 1 in 1,500 in 1998" and that "the share of high incomes that were untaxed increased more than sevenfold to one dollar of every $166."
But spending on government services and defense as well as two costly wars also rose and had to be paid for. In eight years, Bush increased government spending by a colossal 104 percent. But Bush alone didn't increase spending. He just increased it exorbitantly. Government spending increased under President Clinton by 11 percent as it has with every other president whether Republican or Democrat in past decades.
There is no way to avoid this. Government bills have to be paid, and spending despite much talk, and the many cut government spending plans put forth will continue to rise due to one simple fact. There are more people who need more services, and they cost more, and with no way short of massive elimination of those services, somebody has to pay for them. That somebody will continue to be Romney's mythical 47 percent. Even under the most cheery fiscal forecasts on spending, almost inevitably there will be another shift upward in taxes to working persons and the poor, the only question is how much and when.
Who pays and how much will continue to be hit points Romney will use against President Obama to try and make the point that taxes are an unfair burden on everyone, especially corporations and mid-size businesses that prevent them from revving up the economy. But the price to do that won't change. It will take revenue, and lots of it, because those same corporations and private business and investors such as Romney and Bain have their hand out to government for legions of government subsidies, tax breaks, and contracting programs that benefit them. They aren't poor but many of them are as much a part of the 47 percent as the poor.
Earl Ofari Hutchinson is an author and political analyst. He is a frequent political commentator on MSNBC and a weekly co-host of the Al Sharpton Show on American Urban Radio Network. He is the author of How Obama Governed: The Year of Crisis and Challenge. He is an associate editor of New America Media. He is the host of the weekly Hutchinson Report on KPFK-Radio and the Pacifica Network.