America’s Tax War: Principle or Necessity?

TurboTax Premier Fed + E-File + State Tax Year 2011 417416 

            The right wing argument of “class warfare” in the US has been at the forefront of American politics as of late.  The Democratic agenda to increase the tax rates on the upper-class has made the top one percent of Americans cringe at the idea of having to pay tax rates comparable to the middle and lower classes’ long standing tax burden of upwards of 30%..  Since the average upper class citizen pays a rate of less than 15% on an annual income of $1,000,000 or more, the high rate of the lower and middle class’s 30-36% is seen by many Americans as being an unfair and unbalanced financial burden.  The question the general public seems to be asking is why are the rich paying taxes at a rate that is less than half of what the average income American pays?

           

            President Obama has teamed up with billionaire entrepreneur Warren Buffet to push through a bill know as “The Buffet Rule” which will ultimately raise the tax margin on the rich to equal that of the lower and middle income percentages.  The idea is that by increasing these margins the revenue increase to the country will help in the long and arduous process of reducing the national deficit.  The middle and lower class voters agree with this bill on the principle that because we are all in this country together and we are all responsible for doing our part to help this country grow stronger then we all should pay our fair share of taxes in order to do so.  They also feel that out of necessity the entire country’s tax revenue burden should not rest solely on their shoulders.  The need for lower tax rates lies with the people who generate lower annual incomes and require the money in order to survive.W-2C Continuous Tax Form, 100 FORMS/PK, 8606862-B, Use to correct 

           

            Some wealthy Americans see this argument in a different light.  They feel that out of capitalistic principle the upper one percent of the country should not have to pay more for their achievements than the lower classes. Their argument is that with a 36% rather than their current 15% tax rate they would be paying a substantially larger margin in taxes on their annual income than the rest of the country.  This would only be counterproductive to job growth because they would be more reluctant to hire new employees in order to save money and continue to allow their companies to expand.  They spend millions of dollars every year lobbying congress to extend the Bush era tax cuts on the wealthiest Americans so that they may increase their profit margins without fear of tax increases.
           W-4 Tax Form 25 CARDS/PK, V2245-2012, Employee's Withholding

            The majority of Americans agree that there has got to be a compromise between the upper and lower classes in this country.  The idea that we should all pay our fair share in taxes has been demonized by the right as being an anti-capitalist or socialist philosophy.  This in fact has been the right’s strongest argument to date against raising taxes on the wealthy.  This argument does not seem to be an intelligent one though, rather it is aimed at the small percentage of conservatives in this country who still fear a socialist democracy out of ignorance of what that philosophy would truly mean for the vast majority of American citizens.  The Cold War era fears of a communist takeover of the country have all but vanished leaving only a small minority of individuals who still falsely believe that socialism is a large step in the transition between a democracy and communism.  So the question remains: Is there a compromise that both sides of this debate can reach? Or, will the income gap between the upper and lower classes continue to expand until there is no longer a middle class?  This country has not seen this kind of class warfare since the Great Depression.  What will be, if anything, our generation’s New Deal?