Who in his right mind would demand to pay higher taxes? You may well have asked that as some argue for higher rates on wealthy taxpayers like themselves.
But it is really not that difficult to understand if you remember that the rich aren’t just taxpayers — they are, first and foremost, citizens. And good citizenship often means supporting policies that may pinch or inconvenience in the short run, but in the long run are good for your country and, therefore, for you and your family.
I am one of those wealthy citizens and today I am calling for an end to tax cuts on annual incomes above $250,000, even though it means I would pay more.
The current top income tax rate was instituted early in the George W. Bush administration. It represents a 12 percent cut from the Clinton years, a period of expanding prosperity for almost all Americans — including the rich. But after the rate was reduced in 2001 (and even before the financial panic and Great Recession that closed the decade), the economy put in a lackluster performance. Most families saw no real income growth.
Sure, I saved some money on my taxes. But those savings didn’t affect my spending or investment habits. Contrary to the expectations of anti-tax zealots, my lower taxes didn’t inspire me to start a new business that hired the unemployed.
So as a taxpayer, the Bush cuts didn’t do much for me or cause me to do much for the economy. But as a citizen, those high-income tax cuts cost me a lot. They added hundreds of billions of dollars to the national debt, threatened public investments in programs such as Medicare and college tuition aid that support middle-income families, and even endangered America’s creditworthiness and honor around the world.
That is why the cut should be allowed to expire on schedule at the end of this year, restoring the slightly higher rates of the 1990s. Only 2 percent of American taxpayers will be affected, and even among those of us who are, for the vast majority the individual impact will be relatively slight. But collectively, something like a trillion dollars in revenue will be raised over the next decade, lowering the nation’s public debt to more manageable levels and strengthening public investments in the middle class.
Among the frequently-heard, phony arguments against re-instituting more equitable tax rates for wealthy people like me are that they will hurt small business owners (recently redubbed “job creators”); that fair tax rates somehow “punish success”; that they represent “class warfare.”
Only 3 percent of “small businesses” net over a quarter million dollars a year (that is profit, not revenue) and you won’t find them on Main Street — try Wall Street. (For that matter, the picture of all wealthy people as self-made entrepreneurs is demonstrably false. Like a lot of wealthier people, I inherited my money.)
Fair taxation — expecting a higher percentage of contribution from the wealthy — does not punish success or wage war on anybody. Rather, it allots financial responsibility for the common good rationally, based on ability to pay.
Sens. Olympia Snowe and Susan Collins will be key players in a dramatic, year-end congressional session called to grapple with the budget. I hope they ignore the rhetoric of their party and in the spirit of Republican independence exemplified by Sen. Margaret Chase Smith, be guided by a commitment to what is best for Maine people, not the interests of a greedy few.
I am not alone among wealthier Mainers and Americans who want to see higher taxes on folks like ourselves be included in any deficit-reduction deal. We may appreciate low taxes as taxpayers, but as citizens, we cannot afford them.
Jonathan Lee is a filmmaker and executive director of the Machiah Center in New Gloucester.
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