Two days after his re-election, President Bush offered the public some guidance on what he says will be a central goal of his second term: “tax simplification.” Bush said he wants to “encourage people to invest and save,” i.e., he favors still more tax cuts for the rich. He added that he'll propose a tax code that “rewards risk,” i.e., one that offers even more tax breaks to business. No surprises there. But as previously hinted, this time around Bush offered a twist: His plan will be “revenue neutral.” Of course, that requires raising taxes -- by a lot -- on everyone else to break even.
In September, my group, Citizens for Tax Justice, released a major study on corporate tax avoidance. We looked at 275 of the largest and most profitable Fortune 500 companies and found that almost a third managed to pay nothing (or less) in federal income taxes in at least one of the first three years of the Bush administration. Over that period, the 275 companies reported $1.1 trillion in pretax U.S. profits to their shareholders, but told the IRS that they'd made less than half of that. One company, General Electric, enjoyed $9.5 billion in tax breaks over the three years.
Read my lips: I'll raise your taxes -- a lot. Thus, paraphrased only slightly, speaks George W. Bush to Middle America. Yet many of his intended middle-class victims don't seem to hold it against him. Or perhaps they haven't been listening hard enough.
Russell Long was hardly the darling of liberal tax reformers when he chaired the Senate Finance Committee in the 1970s. In fact, we usually saw him as a toady for corporate special interests. But as the genial Louisiana Democrat liked to say, even a blind hog finds an acorn once in awhile.
Do our big accounting firms deserve some of the blame for the demise of a free press, and even democracy itself, in Russia? This thought first occurred to me when I stumbled on the fact that PricewaterhouseCoopers (PwC) is the accounting firm for Yukos, the huge, troubled Russian oil company. As has been reported, Yukos' principal owner is now in jail on massive tax-evasion charges, other corporate officers have fled the country to escape arrest, and the company's potential bankruptcy has helped push up the world price of oil to record highs. The plot thickened when I discovered that Yukos' ownership runs through a chain of tax havens, leading ultimately to a post-office box in tiny Gibraltar.