By Sally Kohn, ,
Published May 07, 2015
My grandfather was a small business entrepreneur. He owned a clothing store in Penns Grove, New Jersey, and families came from across the southern part of the state to get slacks and blouses and jumpers for their kids. My grandfather employed two people who earned decent, middle class wages and made a good living for himself, probably upper middle class for that region.
And good for him. He worked hard and earned it.
But there were things that helped my grandfather’s business that he didn’t have to pay for. The roads trucks drove on to bring him products to sell. The court system that incorporated his business and protected the patents of what he sold. The police force that made it safe for people to shop there. The public schools that taught his employees how to read and do math, so my grandfather didn’t have to teach them. Make no mistake about it — my grandfather succeeded because of his hard work and initiative. But government played a supporting role.
By grandfather was not rich, certainly not by today’s standards. But when Ronald Reagan was president, my grandfather paid almost 50% of his income in taxes to help make sure that good public schools and safe streets and the things we all need to succeed in America would be available for the next generation. Today, hedge fund managers and big business CEOs pay lower tax rates than middle class families. In fact, the tax rate for the very wealthy is the lowest it’s been in over 60 years.
That’s right: We’re not even debating whether the wealthy should pay more than middle class workers. President Obama wants the very rich to pay the same rate as the rest of us. Those who have succeeded in our country, in part with the help of our public infrastructure, should just bury their money in off-shore accounts and loopholes. That’s un-American. Those who do well in America should do well by America — and pay their fair share of taxes so others have the same opportunity to succeed.
A lot has been made over comments made by the president last Friday to this effect. In many cases, President Obama was deliberately quoted out of context. Here is what the president actually said:
"If you were successful, somebody along the line gave you some help. There was a great teacher somewhere in your life. Somebody helped to create this unbelievable American system that we have that allowed you to thrive. Somebody invested in roads and bridges. If you’ve got a business. you didn’t build that. Somebody else made that happen. The Internet didn’t get invented on its own. Government research created the Internet so that all the companies could make money off the Internet. The point is, is that when we succeed, we succeed because of our individual initiative, but also because we do things together."
It’s not either/or. The president was clear: We succeed because of our individual initiative but also because of the public investments that help springboard that success. Don’t believe me? Then go start a business in Pakistan or Russia. American entrepreneurs succeed in part because they’re in America. And in America, we don’t get ours and then yank away the ladder of opportunity for the next generation.
We can slash Medicare and Social Security and public schools and college grants and all of the stepping stones that poor and middle class families have historically relied on to help climb the ladder of prosperity. Or millionaires and billionaires can pay the same tax rate as the middle class.
Jerry’s Bargain Store went out of business after my grandfather died. Now people shop at a Wal-Mart instead. Wal-Mart’s CEO, like most corporate executives today, is paid mostly in stock, which is taxed at a far lower rate than income.
My grandfather built his business with his own two hands, ran it every day, paid far more than his due of taxes and never complained. He would be appalled that big business CEOs today aren’t paying near their fair share.
We should all be appalled.