Guest Spot: Middle class is shouldering unfair burden

03/31/2011 5:48 AM |

Benjamin Franklin once famously wrote, “In this world nothing can be said to be certain, except death and taxes.”

Well, leave it up to the ingenuity of American business 200 years later to prove him wrong.

Few people enjoy paying taxes, but most recognize that paying taxes is a necessity. While we can all debate the best level of taxation, we broadly understand their need and the value of the services they support.

This entire system is upended by efforts by the richest Americans and top corporations to use their resources and influence to avoid paying their fair share.

In fact, a recent New York Times report showed that last year, not only did General Electric avoid paying taxes on its $5.1 billion in U.S.-based profits, GE actually got a $3.2 billion rebate!

This windfall is no accident; GE employs 975 highly paid lawyers and accountants to ensure the company pays as little tax as legally possible. GE’s tax shop is also on the lookout for ways to amend the tax code to the company’s advantage, with an army of Washington lobbyists at the ready. It is a sorry state when profitability is based on hiring accountants to devise new ways to exploit loopholes rather than workers to build better products.

The bottom line is that the tax code is written by Congress, and we all need to take responsibility, Democrats and Republicans, for devising a system with so many loopholes that a profitable company can escape taxes entirely. Much is made of the 35 percent federal tax rate for corporations, but virtually all corporations pay a far lower effective rate — and a great many profitable corporations pay no corporate taxes whatsoever.

The fact that corporations are able to avoid paying taxes is unfair to those of us who pay our fair share. But the issue takes on added urgency at a time when we are grappling to control a deficit that all sides can agree is unsustainable. It is neither fair nor sustainable to say that the deficit requires us to cut financial aid for nine million students, fire 1,000 scientists at Brookhaven National Lab and eliminate heating oil assistance for thousands of desperate Long Islanders, but heaven forbid we collect one dollar in revenue from General Electric. But that is what the House Republican budget does.

Additionally, the House Republican budget would cut $250 million from enforcement at the IRS. In other words, we’ll be making it easier for people who cheat on their taxes, putting an even heavier burden on the rest of us who play by the rules.

Perhaps some will say, “OK, they’re not paying taxes, but they’re putting people to work.” Unfortunately, in the past decade, GE has eliminated 20 percent of its American workforce while hiring workers overseas.

Over the next few weeks and months, I hope to join with my colleagues on both sides of the aisle and work to restore a fair tax code. Some may choose to demagogue an issue like this and say I want to raise taxes. If you consider that GE paid zero on more than $5.1 billion in profit, then yes, I suppose that’s correct. I also suppose you could say that if they paid one dollar that would represent an infinite increase in taxes.

I hope we can address this problem in the same spirit as when Ronald Reagan worked with Congressional Democrats in 1986 to support sweeping changes to the corporate tax code when he found that numerous large businesses were effectively paying no U.S. tax, including — you guessed it — GE. But that bipartisan reform has been steadily eroded over the past 25 years, to our nation’s great detriment.

Real reform will make the tax code simpler and perhaps lower rates, while eliminating loopholes to ensure that the effective rate is fair and evenly applied. This will help encourage job creation and investment in America, while ensuring that corporations, not just middle-class families, pay their fair share to fund our government.

Mr. Bishop is a Democrat and Southampton resident who represents New York’s 1st Congressional District.



24 Comment

  • Mr. Bishop seems to have forgotten that he is a member of Congress, and thus responsible for the hideous mess that is the U.S. tax code. The constitution specifically states that all tax legislation begins in the House of Representatives.

    Another convenient omission is that Democrats were in charge of the House, Senate and White House during GE’s last fiscal year, and that President Obama appointed GE CEO Jeff Immelt to high government office.

    Maybe there should be an apology in order.

  • I have heard of revisionist history but, THIS TAKES THE CAKE!

    Obama’s competitiveness adviser runs a company that paid $0 in taxes on $14B profit? Mr.Bishop, you know who that corporation is!!! It’s GENERAL ELECTRIC! It is an Obama/Bishop CORPORATION playing for YOUR team. You really think CD1 residence are going to fall for this line of hooey, you have another thing coming to you! Don’t worry, we will make sure the good folks are fully aware of this line of tripe!

    NOW, you worry about fair taxation?!!! To little to late!

    I really wish you were NOT in congress for AGES, but you have been and are RESPONSIBLE for the MESS AMERICA IS IN!!

    PS: RONALD REGAN WAS A REPUBLICAN! You, Sir, are NO republican!

  • Hahahaha
    That is soooo funny. I’m sorry if this sounds rude but I can’t contain myself. I went to meetings, heard Tim Bishop, and have actually voted for him because this is the kind of language distortion he engages in regularly and he tricked me. I’ve fallen for it, but no longer.

    He sounds like he cares about not spending, but he always votes for spending; he sounds like he cares about soldiers and helps paint VFW halls while he’s voting to defund military in the field (twice); he pretends he’s not an outsourcer while he votes to outsource whole industries. Tim Bishop gets entitlements for illegals while he pretends he cares about the border fence, knowing the fence isn’t going to be continued He is the opposite of what he says in this article.

    People really need to research for themselves. Don’t listen to me. Research and don’t listen to what he says, watch what he does. He was incompetent at Southampton College and he’s incompetent in this job.

  • Surely this is a joke. Rep. Bishop paints GE, the company that is in bed with him and his buddies, as the enemy. GE’s Immelt is ADVISOR to President Obama, Rep. Bishop’s leader. GE has made a good deal of money off our government/taxes so how can Rep. Bishop say GE is the enemy? He’s voting to fund them. Rep. Bishop is GE’s partner so if they didn’t pay taxes, blame Rep. Bishop.

  • I agree with the comments here. Rep. Tim Bishop is the problem. He is part of the corrupt system that allows GE’s Immelt to function as a U.S. company without paying taxes. Tim Bishop is the taxman and he is the outsourcer.

  • This is a bipartisan issue. Commenters, shouldn’t we be asking why GE and the other large corporations pay so little in taxes, and we, the middle class, pay so much?

  • Tim Bishop is responsible for the tax code. This is disingenuous. I agree with Lara to a point but the hypocrisy in this article is too much to ignore. It overshadows the tax issue.

  • Eveyone needs to pay there fair share hows about doing away with tax-exempt status of religious organizations for starters….they make Millions pay no taxes on the money they take in and dont pay any property taxes…..nice deal…..

  • Congressman Bishop speaks the truth about GE and most of the comments ignore that truth. Years ago when a child I asked my Dad what was the difference between Democrats and a Republicans ? He replied, “The Republicans were mainly for the rich and the Democrats were more for the poor.” That simplistic answer seems to have been born out over the six decades he told me that. How many Republican congressmen would have written their local paper what Congessman Bishop wrote?