by Maura Quint
The year is 1975. The Bee Gees are at the top of the charts. “The Godfather: Part II” just won the Academy Award for Best Picture. And income inequality is the lowest it’s been in generations.
Flash forward to 1985. Wham! is the band of choice. “Back To The Future” is a thoroughly enjoyable box office smash. And Ronald Reagan is starting his second term as president.
And that’s the clincher. From Reagan’s first term to when he left office, income inequality in the United States nearly doubled. One driving factor was the president slashing the top marginal income tax rate from 70% to 28%, chasing some ludicrous theory known as trickle-down economics.
Now, in 2021, amid the pandemic, U.S. billionaires have gained nearly $2 trillion while the working class struggles to get by. It’s become clear that tax cuts for the rich did not and do not trickle down to the working class; they just make the rich richer.
Republicans have tried everything they can to block the bipartisan infrastructure package and Democrats’ reconciliation bill — and why wouldn’t they? They’re hopelessly devoted to protecting billionaires and making the rest of us pay for it, even as poll after poll shows that “Build Back Better” is a winning message across party lines. The plan’s call to crack down on tax evasion and increase taxes on the rich is backed by 97% of Democrats and 72% overall.
Taxing the rich isn’t even a new idea. Historically, our country has imposed relatively high taxes on the wealthy. From 1930 until 1980, the top marginal tax rate averaged 78%. During this time, our country saw some of the lowest income inequality rates in its history. When we really taxed the rich, our economy prospered.
The Reagan era was a deviation from the norm, and it is the rich who have benefited. Now we have the opportunity to put working families first and undo the last 40 years of bad economic policy.
When our organization Tax March launched in 2017, we were demanding that Trump release his tax returns. We’ve since evolved toward fighting to make big corporations and the rich pay their fair share in taxes.
To really build back better, we need to raise taxes on large corporations, including a minimum tax rate. (The Institute on Taxation and Economic Police found that 55 of the nation’s largest corporations paid no federal corporate income taxes in 2020.) And we have to close giant tax loopholes for corporations that earn profits abroad.
This includes increasing taxes on the top 1.8% of incomes — those making $400,000 or more per year — and closing tax loopholes so the rich pay their fair share.
As members of Congress come back from their summer vacations, we must stand firm on these policies. The pandemic has exposed the extreme inequality in our society. More people are starting to realize that economic injustice goes hand-in-hand with racial injustice. It’s time to tax the rich, tax big corporations, close the gaps and invest in working families.
Because unlike disco, trickle-down economics is dead. Now let’s create a country that allows all of us to prosper.
Maura Quint, a humor writer who lives in Pennsylvania, is a board member of Tax March.
