Froma Harrop

Hey Folks,

Froma Harrop, who appears irregularly in the Dispatch is a favorite of mine, and in her most recent column she hit the nail on the head !!!

Below is the "Thank You" letter I sent her and the column itself.

I am particularly pleased that she pointed out a lie that has been foisted on the masses by the Super-rich, via their toadies in the Bush Administration: "The top 1 percent of incomes pay 34 percent of all federal individual income taxes."

Conveniently our honorable leaders always fail to include the massive payroll taxes regular folks pay (and which the super-rich essentially escape). Makes you wonder what "democracy" really means if government serves the top 1 % at the expense of the rest of us!

- Uke Man


Dear Ms. Harrop,

Your piece on taxes was the best, most important, and - to me - gratifying column I've read in quite a while.

Everything you reported has needed reporting for a long, long time. Sure, bits have been put out now and then and here and there; in small, back-pages news stories or in small circulation progressive publications; but not all together and on the editorial page and by a nationally syndicated columnist on April 15 !!

Thanks.

Now there is no excuse for the people not to stand up on their hind legs and demand a change.

If they don't, perhaps we should consider calling this the "Gelded Age."

Yours - Tom Harker, Ukulele Man






The Gilded Age
by Froma Harrop

Come to Newport, R.I., and see what America was like before the income tax. The Elms is a Gilded Age mansion graced by a Louis XV ballroom and tapestries from Imperial Russia. Its owner made his tax-free fortune off the coal mines of Pennsylvania and West Virginia. Down the street is Rosecliff, a copy of the Grand Trianon at Versailles and financed by Nevada's Comstock Lode. Steamships and railroads paid for the Vanderbilts' 70-room Breakers and equally lavish Marble House. Like the other Newport mansions, they were used for only a few weeks in the summer.

To the tycoons reveling in their personal splendor, America was about taking, not giving, and the job of the masses was to toil for them cheaply. But by the dawn of the 20th century, American farmers, miners and factory workers started thinking that the Vanderbilts and their ilk should contribute more to the country. And so on Oct. 3, 1913, President Woodrow Wilson signed the bill that created an income tax. It touched only the wealthiest 4 percent.

This piece of history needs remembering as the Bush administration passes around statistics purporting to show that today's wealthiest Americans bear an unreasonable tax burden. The helpers in the Republican base, meanwhile, sing songs of gratitude to the modern moguls. They refer to them as golden geese, who would perish if tax rates returned to the Clinton-era levels -- even though the rich did wonderfully well in the '90s.

The Bush people are particularly fond of noting that in 2003 the top 1 percent in incomes paid 34 percent of all federal individual income taxes. That's not terribly surprising when you consider that the richest 1 percent now earn 15 percent of all the money made in America, and that the income tax was designed to be progressive. (In 1913, the top 1 percent were raking in a not-very-different 18 percent of total U.S. income.)

Middle-income families also pay federal income taxes, and some tax-cut crumbs have fallen their way. But do compare the helpings. For 2006, the Bush tax cuts are worth $39,000 to people with incomes above $403,000 (the top 1 percent) and only about $750 to those making around $50,000, according to the Urban Institute-Brookings Institution Tax Policy Center. Put another way, the elite 1 percent enjoy a 5 percent increase in their after-tax income, while folks in the middle see a 2.5 percent gain.

Of course, the administration propaganda totally ignores payroll taxes, which bring in nearly the same amount of revenues as individual income taxes. When you add all the federal taxes, the top 1 percent account for only 23 percent of the total.

The interesting part will come when the federal government is forced to stop borrowing money and start paying its bills honestly. Who is going to finance government then? The Bush camp has been lining up the planets to ensure that any future tax increases fall onto the middle class.

The centerpiece is the lowered tax on investment income, which Republicans are trying to keep at 15 percent. As a result, the idle rich living off their stock portfolios are taxed at 15 percent, while the working husband and wife, each earning $40,000, pay a marginal tax rate of 25 percent. Even Ronald Reagan was content to have dividends and capital gains treated like "sweat" income.

In 1904, Mrs. Hermann Oehlrichs held her famous "Bal Blanc" at Rosecliff. Everything was white -- from the women's gowns to the truckloads of exotic flowers dumped in the gold ballroom. Mrs. Oehlrichs even asked the U.S. Navy to anchor its "White Fleet" just off her property, as a kind of decoration. When the Navy said no, she commissioned an army of carpenters to build a dozen full-size ship models, which were set in the Atlantic Ocean.

Nine years later, the American public felt justified in asking Mrs. Oehlrichs and other fabulously wealthy citizens to help the country that had so enriched them. Though today's federal income tax covers the middle class, it still asks more of the rich than of others. And that's the way it should be. President Bush clearly regards progressive taxation as a hurdle for the expanding fortunes of our new Gilded Age.