This week, Patriotic Millionaires had its annual conference in DC. This thread has some of the highlights. Their message revolved around America’s approach to its 250 birthday and the choice we have to make: “Will we acquiesce to the coming of a Second Gilded Age or challenge the concentration of wealth and power that threatens to topple our democracy? The promise America held at its inception no longer exists for many Americans. Nearly half of American households are hanging on by their fingernails, unable to afford an unexpected expense of $400, while the richest households control fortunes that exceed $100 billion, an amount of wealth greater than that of many mid-sized cities. Extreme wealth concentration precipitates extreme concentration of political power. The concentration of wealth is strangling our economy, while the concentration of political power is strangling our democracy. All of this— a rigged economy, obscene wealth concentration, and the destabilizing effect it has on democracy— rests on a rigged income tax code. The time for tinkering is over. In order to realize the promise offered at the dawn of our first 250 years, we must first unrig the tax code and rebuild it into a fair, equitable system. Foundational changes to America’s tax law usually augur a change in the year referenced by the Internal Revenue Code’s naming convention. We are currently operating under a tax regime written in 1986. After nearly forty years, the changes required dwarf those of any tax reform package enacted since the income tax first was introduced 111 years ago. It’s time for a fundamentally new tax code: it’s time for the Internal Revenue Code of 2026.”
Their vision continued: “For almost 50 years, the American tax code has been deliberately structured to ensure the benefits ofthe economy flow to the uber-rich at the expense of everyday working people. President Reagan cut corporate taxes, cut the top income tax rate from 70 percent to 33 percent, more than tripled the exemption from the estate tax and cut the estate tax rate, and cut the capital gains rate from 28 percent to 20 percent. He promised the cuts would create jobs, spur growth and eventually ‘trickle down’ to everyone else. Shockingly, that never happened. Undeterred, politicians of both parties continued to espouse the virtues of voodoo economics.”
Their solution starts with a proposal to permanently address structural economic inequality:
• First: Tax all income over $1 million at the same rates, regardless of how income is generated (ordinary income, capital gains, or inheritance).
• Second: Reduce the number of people who are required to pay income taxes by creating a full “cost of living” exemption and imposing progressively higher marginal tax rates of up to 90% for annual incomes over $100 million.
• Third: Create a wealth tax designed to rein in the extreme concentrations of wealth over one billion dollars.
As you know, Bernie isn’t one of those politicians who continues to espouse the virtues of voodoo economics— nor has he ever. On Wednesday, he and Jan Schakowsky took on one piece of the solution by introducing a bicameral bill that, if it passes, will close tax loopholes for corporations, end tax breaks for businesses that move jobs abroad and stop companies from hiding profits in tax havens.
Bernie: “At a time of massive wealth and income inequality and soaring corporate profits, it is an outrage that many large, profitable corporations continue to pay little to nothing in federal income taxes. As working people struggle to pay rent and put food on the table, we have a corrupt and rigged tax code that is designed to benefit the wealthy and the powerful at the expense of working families. Meanwhile, Republicans would make a bad situation even worse by providing even more tax breaks to their corporate campaign contributors and the billionaire class while proposing massive cuts to Social Security, Medicare, and Medicaid. That is unacceptable. We need to create an economy and a government that works for all of us, not just the top one percent. And, one of the ways we can begin to do that is by making sure that large corporations pay their fair share of taxes. American workers should not be paying more in federal income taxes, in a given year, than profitable companies like Target, Amazon and T-Mobile.”
Schakowsky: “We live in the richest country in the world at the richest moment in history, yet many Americans are unable to feel the magnitude of our wealth. One of the biggest problems we face is income inequality. As big corporations continue to rake in record profits, there are many families struggling to put food on the table. Thanks to President Joe Biden, we are growing the economy from the bottom up and the middle out, but we must go even further by passing the Corporate Tax Dodging Prevention Act to help put the interests of everyday Americans ahead of billionaires and transnational corporations. I thank Senator Sanders for devoting his career to tackling income inequality and am proud to partner with him on this important measure.”
There is no way that a bill like this could pass a Republican-controlled House or even a Senate where, though the Democrats hold a razor-thin majority, the balance of power is held by conservatives Joe Manchin and Kirsten Sinema, both blatant tools of the billionaire class. That’s something the American people could change in November, replacing Manchin with Zach Shrewsbury, replacing Missouri Republican Josh Hawley with Lucas Kunce and replacing Florida Republican Rick Scott with Alan Grayson. You can contribute to any of them or all of them here. Similarly, in the House, Democrats have a chance to flip 2 dozen red seats. These are the ones Blue America is most excited about.
Back to the bill Bernie and Jan Schakowsky introduced. “Despite record breaking profits, many of the largest and most profitable corporations in the United States continue to pay little to nothing in taxes. The Corporate Tax Dodging Prevention Act would build on the important progress made by the Inflation Reduction Act in reversing corporate tax breaks— which included a 15 percent minimum tax on large corporations that will raise $222 billion over the next 10 years. Sanders’ legislation would go well beyond this by entirely shutting down offshore tax avoidance and restoring the top corporate tax rate to 35 percent — where it was before Trump became president. Together, these policies will raise more than $2.3 trillion over the next 10 years.”
According to a study from the Government Accountability Office (GAO), 34 percent of large profitable corporations paid nothing in federal income taxes during the first year that the Trump tax cuts went into effect. Overall, the study found that large, profitable American corporations on average paid less than 9 percent of their profits in federal income taxes in 2018. Another study found that 109 large profitable corporations paid zero federal income tax in at least one of the last five years. For example, any American worker who paid a single dollar in income taxes, paid more than the below companies paid in corporate incomes taxes:
Amazon in 2017 and 2018
Target in 2022
AT&T in 2021
Whirlpool in 2022
T-Mobile in 2022 & 2018-2020
Dish Network in 2022 & 2020
How do companies get away with paying little to nothing in taxes? The biggest loophole in the corporate tax code is the one allowing corporations to pay a lower or even zero percent tax rate on profits stashed in tax havens. This loophole explains why American corporations report 59 percent of their offshore profits in tax havens and the absurd situation where one five-story office building in the Cayman Islands is “home” to about 20,000 corporations.
The collapse in corporate revenue is notable both in the U.S. and internationally. The corporate tax used to represent about 30 percent of total revenues to the federal government in the 1950s, but that number is now down to just 9 percent in 2023. Similarly, U.S. corporate tax revenue as a percentage of the economy is one of the lowest among major economies and half the level of the Organisation for Economic Co-operation and Development countries (OECD) average.
This would change under the Corporate Tax Dodging Prevention Act. In addition to putting an end to offshore tax havens and tax breaks for companies that ship jobs and factories overseas, this legislation would reform the tax code by:
Restoring the top 35 percent corporate tax rate, the rate it was from 1993-2017;
Ending the rule allowing American corporations to pay a lower or zero percent tax rate on offshore earnings compared to domestic income;
Closing loopholes allowing American corporations to shift income between foreign countries to avoid U.S. taxes;
Repealing the “check-the-box” and “CFC Look-Thru” offshore loopholes;
Preventing multinational corporations from stripping earnings out of the U.S. by manipulating debt expenses; and Preventing American corporations from claiming to be foreign by using a tax haven post office box as their address.
The Corporate Tax Dodging Prevention Act has been endorsed by Americans for Tax Fairness (ATF), a coalition of more than 420 national, state, and local organizations.
“The global tax system has long allowed corporations to avoid paying their full amount in domestic taxes by shifting their profits overseas to tax havens like the Cayman Islands and Bermuda,” said David Kass, Executive Director for Americans for Tax Fairness. “The Corporate Tax Dodging Prevention Act would remove incentives for offshoring of American factories and jobs by equalizing the tax rates between foreign and domestic profits— and make corporations pay their fair share of taxes.”
Economic inequality goes hand-in-hand with political corruption. Here are a dozen examples of corrupt politicians who should spend the rest of their lives in prison cells:
