Friday, January 27, 2012

On Taxes

For workers, question is not who is taxed, but who taxes  
BY JOHN STUDER  
All of the bourgeois candidates for U.S. president in the 2012 elections—President Barack Obama and his Republican challengers—tout new tax proposals, which they claim will "stimulate" the economy, help create jobs and aid the "middle class."

Each in their own way seeks support from working people and layers of middle classes. But the working class has no interest in how the capitalist rulers organize to collect revenue for their government. The question is not who is being taxed and how much, but who is taxing.

The capitalists' government does face fiscal problems, and the ruling class generally seeks to avoid raising taxes, which ultimately cut into the surplus they extract from the labor of working people. All their various tax schemes today are coupled with plans to cut social programs working people have come to depend on, including Medicaid, Medicare and Social Security.

Republican candidates call for simplifying the tax codes, as well as slashing corporate taxes and taxes on the wealthy, who they call the "job creators," as a means of boosting investment in production.

Newt Gingrich proposes to offer two tax regimes people can choose between—the current tax system and a "flat tax" of 15 percent on your income, buffered by a $12,000 personal exemption. This is coupled with cutting the corporate tax rate from the current 35 percent to 12.5, and eliminating taxes on capital gains, dividends and interest.

Mitt Romney says he will keep the tax rates the way they are now when elected, and then devise a big reform plan, as he says, to "flatten" federal taxes. He would cut the corporate tax rate to 25 percent.

They argue these proposals, heading toward "flatter," simpler tax schemes, will reduce federal bureaucracy and red tape, demagogically appealing to growing distrust in big government and its increasing interference in peoples' lives. The decrease in corporate taxes, they claim, would provide bosses with the means to provide jobs.

The working class has much experience with regressive "flat" taxes. They weigh us down daily in the form of sales taxes, homeowners taxes, taxes on gasoline, alcohol, tobacco, tuition fees, school lunches, road tolls, utility bills, driver's licenses, birth certificates, marriage licenses and so on.

Populist demagogy of 'tax the rich'

President Obama has ratcheted up populist demagoguery calling for increasing taxes on the rich, the "1 percent," with a nod toward the Occupy forces he hopes to harness into his campaign. His aim is to raise the revenue needed to fund an expansive government bureaucracy to do "good works" and regulate workers' behavior, such as with new taxes on soda pop to keep us from getting too fat.

Obama invokes what he calls the "Buffet rule," urging that those with annual incomes over $1 million—less than 450,000 out of the 144 million who filed tax returns in 2010—should pay at least the same percentage in taxes as those with median income.

Warren E. Buffett, Obama's inspiration, is the third richest man in the world as of November 2011 according to the "World's Billionaires" list in Forbes magazine, worth about $39 billion.

(This, of course, is pure demagogy. Buffett and others like him know all the loopholes to evade taxes and can pay all the lawyers and accountants they need. They can afford not to pay taxes. It's their system.)

Workers are barraged with all these tax schemes and urged to choose their poison in order to save "our" economy. But there is no "our" economy, or "our" government. We live under their government, a dictatorship of capital.

Workers have no interest in how the capitalist class organizes to get the money to fund their government. This is the reason the capitalist class levies taxes: to beef up their cops and prisons; to pay for their ever-expanding government; to pay for the profit-producing interest they rake in on their government bonds; to balance their budget. Whatever they need to advance their class interests, which are irreconcilable with those of the working class.

For this reason, communists have no "tax program," urging some taxes be raised and others cut. Communists oppose all taxation on working people. Up until 1943, workers in the U.S. paid no income tax. The first was imposed by Democrat Franklin D. Roosevelt, because the U.S. rulers needed to pay for their drive to dominate the world capitalist order through the slaughter of World War II.

Can't tax our way to political power

The working class needs to chart its own political course. There is no way for workers to tax our way to taking political power out of the hands of the capitalist exploiters. No way to change the government and its class priorities by advocating more taxes on the rich.

This can only be done out of the battles fought by working people to defend themselves and others, deepening class consciousness, leading to a victorious revolutionary struggle for political power.

To do this requires a break with both capitalist political parties, the Democrats and Republicans. We have to do away with all illusions that their system can be reformed to serve us.

Workers know that the rich get away with murder. They also know the capitalists' government bureaucracy is a nightmare for us. But no reform or tax scheme can alter the class nature of the power we face.

It is the labor of working people that creates the massive surplus value that capitalists appropriate and from which they derive their profits and power. Nothing workers get in terms of schooling, medical care, or pensions is charity—it's all produced by us.

A workers and farmers government will not levy taxes on working people. A government of toilers will provide universal lifetime education, health care, and disability and pension benefits by drawing on society's enormous surplus wealth—wealth produced in one and only one way, by the working class.  
 

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