Cornyn’s Half-Truth

July 19, 2011 § Leave a comment

John Cornyn, (known as Good Hair Senior to distinguish him from Rick Perry, Good Hair Junior)is  one of Texas’ protectors of the Greedy Rich.  He is now stationed in the U.S. Senate, to which he transferred from the Supreme Court of Texas.  [He was no longer needed there because the Texas Legislature had essentially abolished all common law remedies for injury due to corporate negligence or medical malpractice.]  His current assignment is to justify the enforced payment for the wars,  spending sprees and disastrous economic policies of the last Bush administration by gutting every federal program designed to provide medical care, decent education or relief from jobless poverty for working class Americans.  His prime targets are Social Security, Medicare and Medicaid.  His loyalty to the GR requires him to accomplish this without a penny’s worth of contribution from them.

Because we live in a democracy; because the victims of his effort far outnumber its beneficiaries;  and because those victims are allowed to vote [although strenuous efforts are underway to remedy that problem], Good Hair Senior’s selling job would appear to be daunting.  He is required to explain why raising taxes on the GR  should not be at least a part of the solution for our fiscal problem.

GH, Sr.’s response to his problem is remarkable for its simplicity:  He simply attacks the fairness of the federal government’s system of taxation.  On July 7, 2011, on the floor of the U.S. Senate, he charged that only 50% of Americans pay any income taxes.   Therefore, he argued,  it would be unfair for that half of our citizens to be expected to pay for programs that benefit the other half.   He implied that he might favor taxation as a remedy for our fiscal distress if taxes were more evenly imposed.

This is the current version of Saint Ronnie’s mythical “welfare Cadillac” recipient of federal largesse.  “Why”, the argument goes, “should half of us hardworking folks pay taxes so that these other louts could get handouts from the government

I have described it as a half-truth.  Here are the facts, as stated by PolitiFact:

“Cornyn took care to refer to households that pay no ‘income tax,’  rather than suggesting that they paid no taxes at all. Many Americans who pay no income tax pay other federal taxes, most notably the payroll tax, which funds Social Security and Medicare and is deducted from every working American’s paycheck.

Estimates by the Urban-Brookings Tax Policy Center project that for tax year 2011, 46.4 percent of households won’t have any income tax liability. However, of this number, 28.3 percent will pay payroll taxes, the center projects. Of the remaining 18.1 percent with neither income nor payroll tax liability, 10.3 percent are elderly and 6.9 percent are not elderly but have incomes lower than $20,000. In other words, all but a tiny sliver of Americans without either income tax or payroll tax liability are either elderly or poor.”(emphasis added)

When the relevant facts are understood, it does not seem so unfair to tax the wealthiest 10% of Americans, who own more than all of the wealth owned by the other 90%, to help pay the tab for Bush’s blunders and deliberate misdeeds.   After all, Social Security, Medicare and Medicaid are major targets for proposed cuts in spending and two of those programs are the very ones paid for by payroll taxes.

The real reason for this remonstrance is an op/ed piece in the morning Chronicle by John W. Diamond, described as “the Edward A. and Hermana Hancock Kelly Fellow in Public Finance at the Baker Institute at Rice University”.  Fellow John does not bother with GH, Sr.’s hair-splitting about “income tax” payers.  He just goes for the simple lie.  Here is what he allowed to be published in his name:

“A tax-the-rich strategy has three disadvantages:  It creates disincentives to engage in economic activity and increases the amount of effort spent on avoiding taxes; it is based on class-warfare and increases the probability that brinkmanship will end badly; and it does not spread the costs of paying for public goods and services among all taxpayers.  The last point is important is important given that almost 50% of tax filers do not pay taxes, and thus are more likely to support unsustainable budget policies if viewed as a free lunch.” (emphasis added)

The first of his three “disadvantages” is ludicrous; the second is based on a gross misuse of the phrase “class warfare”and the third is a lie.

No one smart enough to make taxable income is going to pass up a chance to make more money because the amount he or she gets to keep is reduced by a few percentage points.  We are not talking about confiscatory tax levels.   All that has been proposed is to return the GR to the same tax levels they happily paid during the Clinton administration.  They were happy to pay it because they and the rest of the country were doing very, very well.

So far as concerns “class warfare”, his statement is out of Animal Farm or Humpty Dumpty, who claimed the right to make words mean whatever he chose.   Protecting the rich by picking the pockets of the working class is exactly what “class warfare” is all about.  Fellow John and others like him are waging it.

His third “disadvantage” is a lie because he refers to “tax filers”, not “income tax filers”.   Wage earners who pay payroll taxes are required to file income tax returns .* Their taxes have been withheld from their earnings.   Are we to believe that the “Fellow in Public Finance at the Baker Institute at Rice University” was unaware of that fact?  Perhaps  he never worked for a living.  Or, perhaps he is a liar.

Don’t forget that the Baker Institute is named for Jim Baker.  Remember him?  Remember the architect of the Florida coup d’etat?  And the subsequent coup d’Supreme Court?  Same guy.

*According to my brief online research , any wage earner who grosses over $12,000 (for a joint return) is required  to file a tax return.  A single wage earner has an even lower threshold amount.  I assume those who are not required to file a return based on these numbers are some of the “poor” referred to in PolitiFact’s report as making less than $20,000 per year.

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