A few words about the makers and the takers.
That, as you may recall, was the formulation once favored by Fox “News” and other organs of the political right to describe the dynamic between those at the top of the economic pyramid and those at the bottom. The poor — characterized as scavenging animals by more than one conservative — were said to contribute nothing to our society, while mooching off their financial betters.
But it is worth re-examining the whole “makers and takers” paradigm in light of last week’s jarring report from ProPublica, the nonprofit online newsroom. It was based on a trove of IRS information provided by an anonymous source, and it laid out in granular detail the strategies used by the wealthiest people in America to get away with paying little or nothing in taxes.
Take, for instance, Jeff Bezos, Amazon founder and world’s richest man with a net worth estimated by Forbes at $192 billion. We are told that he paid nothing in taxes in 2007 and 2011 and a relative pittance in other years.
Not to pick on Bezos. Elon Musk, Michael Bloomberg, Warren Buffett and other ginormously rich people all reportedly employ the same strategy to avoid taxes. Which is to say, they pay themselves minimal salaries — as little as a dollar a year in some cases — and keep their wealth in the form of stocks, bonds and other financial instruments, which the IRS does not consider income and taxes at a much lower rate.
For comparison, ProPublica says the median American tax rate in recent years is 14 percent. But it calculates Bezos’ “true” tax rate between 2014 and 2018 — i.e., factoring the growth of his assets in with his reported income — at under 1 percent. It says that when people like him need actual cash, they simply borrow against their massive assets. Interest on such loans runs in the single digits, and the proceeds are not considered income and therefore are not taxable.
All of this is perfectly legal, by the way. Also, perfectly infuriating.
And here, let me just say: I believe in capitalism. I believe that when you incentivize earning, you incentivize risk-taking, innovation and hard work.
But I also believe something is wrong when CEO pay rose by about 1,000 percent between 1978 and 2018, while worker pay edged up just 12 percent.
Something is wrong when working full time doesn’t put a roof over your head or food on your table.
Something is wrong when an Amazon driver complains of 14-hour shifts and peeing in bottles to make his delivery quotas.
Something is wrong when employees at Tyson and other meat packers report wearing diapers to work because conveyor belts are relentless and bathroom breaks denied.
I also believe that paying taxes is a patriotic duty. Onerous? You bet. But patriotic, just the same. It’s how we fund our governments, local and national, and the services they provide: everything from road maintenance, fire and police to military defense, food safety and environmental cleanup. We all benefit from those services, whether ginormously wealthy, pitiably poor or somewhere in between. Any tax code that allows the rich to freeload on that which is paid for by the rest of us is morally bankrupt and in need of overhaul.