Bipartisan talks on reducing the deficit have fallen apart - surprise! - over the issue of increasing the revenue side of the government's balance sheet in addition to simply cutting expenses. Is eliminating some tax breaks to some of the world's richest and most profitable companies -- including Exxon Mobil, Royal Dutch Shell and BP - really a tax increase, as Republicans insist?
For a clear-eyed discussion of the issue, read Caroline Baum's piece on Bloomberg.com. A staggering $1 trillion in tax breaks are doled out every year - at the expense of American taxpayers. Federal tax revenues, by the way, are at their lowest levels in 60 years. And corporate taxes are around 1% of GDP, a third of what they were in the 1950s and the lowest percent of GDP among major nations. (For a visual chart from the Tax Policy Center, click here.) Many of our biggest corporations (hello, GE) pay NO income taxes at all!
So let's stop falling for the line that these are tax increases. It is eliminating corporate welfare, clear and simple, to some of the wealthiest and politically-connected corporations on earth. So yes, let's rethink the 35% corporate tax rate. But let's also be clear that, as the NY Times has periodically pointed out, "nobody pays that."