27 January 2010

Americans vote for higher taxes for the rich - Don Paskini


Voters in the American state of Oregon voted yesterday on two ballot initiatives to raise the minimum taxes paid by corporations and increase marginal tax rates on people earning more than $250,000 per year.

Both proposals passed, with 54% support for higher taxes on the rich and 53.4% support for higher taxes on corporations. Apparently, this is the first time that voters in the state have supported a tax increase by ballot initiative since the 1930s.

It is a victory for local Democrats and their union allies, thanks to large turnout by traditional Democratic supports.

It means that rather than planning for spending cuts, the state legislature can focus on new spending priorities.

I’ll be interested to hear how the great and the good analysts who have been telling us that the Democrats have been losing because they have been too ‘liberal’ and ‘big government’ explain this results.

More information here and here.

George Says:

The idea that tax-rises for the rich solve the problems of society, and increase the tax revenues for the state is a commonly held myth. The rich and super-rich have, and always will be, aware of loopholes, tax havens and creative accounting techniques.

What this vote could signify is a changing realisation that more taxes, spread throughout society, are the answer to many problems in the USA, and to a lesser extent here in the UK.

The most important principle, which is unlikely to spread throughout America, although it should, is the realisation that this recession is the fault of the hyper-risky investment banks. The over reliance on the financial sector in both countries has caused huge, long-term problems for so many areas of society. This is crucial, the growing numbers (who never had any interest in economies or financial institutions) are beginning to show disgust, and this is just one way of highlighting that, even if the potential returns from it are minuscule in comparison.

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