When you also get brave enough to stop calling a failure to increase the amount of government spending cycle to cycle a "budget cut" you just might be on to something.

Now let's get back to first principles. You claim an argument of "fairness" based upon a formula of treating citizens differently. Essentially, you ask nothing of a broad swath of the citizenry (consumers of public services primarily) and you ask more and more (graduated income tax with a surcharge on top) of an increasingly narrower band of the citizenry (revenue providers). How again is that honestly characterized as fair? Are you channeling some disreputable Rawlsian notion of "distributive justice?"

You can't just claim "fairness" without underpinning it with some sort of argument as to why you view it as such.

You forgot to add, Jeff, that some conservatives believe that if you don't use it yourself, you are not obligated to pay for it. I have a cousin who fights tooth and nail over giving his tax money to the schools when he has no kids attending them. "Why should I pay anything when I do not have a dog in the fight (so to speak)" he says.

Well, Jeff, you have answered my cousin very well in your post.

Wow, Boats. Reminds me of the late great Boats Johnson - a local comedian.

  Here's the solution: If the extremely wealthy would stop using their disproportionate amount of power and influence to their extreme advantage, we wouldn't need to tax them more.

   That would be fair, but you know that's not going to happen.

  The standard argument during these last few decades where there's been an unprecedented migration of wealth to the upper class, is that it's still not fair because they pay more taxes. Besides, even bringing it up is class warfare and sounds like communism.

   Of course, if everybody made zero except for one rich person who made it all, that person would be the only one paying taxes, and you could argue how unfair the system was to him or her, with her probably being Oprah.

  Meanwhile, the extremely wealthy have essentially purchased the government and crushed the unions. They have no qualms about making that part of the equation unfair. In effect, they have gamed the system. That is why, for example, Warren Buffett pays less taxes as a percentage than his secretary.

  And of course, we all know what happens when they mess up. The many must step forward and deliver welfare to the super-rich. And guess what? They never complain about how unfair that is.

  When I was a kid there were no billionaires. Now there are lots of billionaires. Yet, they still complain about helping too much, unless, of course, they're asking for help themselves.

  One last point: This "drowning the baby in the bathtub" image is sick. We've got to come up with something better than that.

Do corporations pay taxes, or do they pass them off to their customers as a cost of doing business?

Bill,

It's claimed that Margaret Thatcher once said:

"The problem with socialism is that eventually you run out of other people's money [to spend]."

Source: http://en.wikiquote.org/wiki/Talk:Margaret_Thatcher.

There is no true reference to the actual statement, but the wikiquote digs deeper into its likely origin.

Also, your reference to few or no billionaires when you were growing up, there are several reasons: inflation being the most prominent.

Isn't this a great country when a poor, smart schlub can work hard, and build and accumulate wealth from almost nothing, despite the barriers that government might place in his way? There have been many opportunities for people to become millionaires and billionaires in the last 100 years that has nothing to do with the "rich getting richer" crowd.

Regarding the wealthy crushing the unions: not only them. Today's WSJ writes about the union leadership getting rich off the backs of their own members who are suffering.

And as for Sid's question, of course corporations pass on their costs to their customers. Most customers simply don't realize it until it is too late. Heck, even employees of these big, bad corporations pay taxes on their wages and salaries.

In other words, we're still trying to get beyond the Reagan Revolution. It has destroyed the country. Those who are still in the fold should be tried for treason and hung on piano wire. Newt, yer first!

Good points, Jeff. I especially like the reminder that we tried the extreme right's way and it didn't work. It was a fair test - and it crippled our nation and our state.

However, you missed the other leg of the anti-tax, anti-government segment: What we pay in taxes is plenty if government were only properly managed. In other words, they (the Gov'mint) are all corrupt and incompetent (but apparently not incompetent at being corrupt), and a drain on the economy besides. If we have to have government workers, they ought to work for minimum wage and be grateful for the opportunity.

An even cursory examination of that argument and a brief review of the facts would/should scotch that argument, but people never get there. It just feels too good to scapegoat government workers. The only politician we've ever had that really tried to engage the right on that front was Barbara Roberts, and she paid a heavy price.

Sid asked: Do corporations pay taxes, or do they pass them off to their customers as a cost of doing business?

If I remember right from public economics, the incidence of the tax (who the tax falls on, which may be different than who writes the check to the government) depends on the particular tax. For a sales or property tax, much of the tax is passed on to customers - the exact amount depends on the elasticity of demand.

For the corporate income tax, which is levied on corporate profits, the incidence is generally thought to fall on the owners of the corporation (the shareholders).

What we pay in taxes is plenty if government were only properly managed. In other words, they (the Gov'mint) are all corrupt and incompetent

That statement is udder crap. Show me any entity, private or public, that is even remotely efficient. What we ask, is that since govt is using the public's monies, that it at least proactively work toward a high level of efficiency.

Eric,

As a childfree person, people often ask if I feel if I should have to pay for schools...my answer is always "of course". After all, today's students are going to be my doctor, surgeon, mechanic, elected official, storekeeper, etc. in future years and I want them to be well-educated and trained in their chosen fields. If you haven't already, try putting it to your cousin that way and he might see the light.

The wingnuts love to talk about having a country without taxes, and how evil govt. is. I suggest they ship out with their AK-47s to Somalia or Afghanistan, the no-tax paradise countries without govt. without police, fire, medical care, social security, public parks, roads, bridges, and no limits on use of weapons. Winguttia paradise! I say, America/Oregon, love it or leave it!

If Democrats would significantly reduce the funding of their war mongering, e.g., 1000+ military bases around the world, and more than a trillion a year for the military-security complex, then taxes would not have to be raised for education and health care.

There are two wingnut parties.

Excellent post. At the bottom line, there is a fundamental difference between fiscal conservatives and progressives. Trying to paper over the differences does not accomplish anything, and seems to make both sides look less and less credible. As a progressive, I believe that the government should collect enough money from taxpayers to fund appropriate public services. As a progressive, I also believe that a graduated income tax is the most equitable method of collecting taxes. My wealthy Repub friends can disagree, but until they win at the ballot box, the progressive Dems are in control and raising taxes is a perk of power.

With the passage yesterday of two modest tax hikes on the wealthy and on corporations, Oregon took a step away from a philosophical orthodoxy that has governed the state for nearly two decades.

Jeff, I'm not sure this is "philosophically" any different than the income tax surcharge passed by the legislature in 2003. As I recall, that surcharge was supported by some brave Republicans as well who saw the devastation that the budget cuts were going to bring. The surcharge was referred to the voters where it got trounced, and the Republicans who strayed were ousted.

I think it's too early to tell if Oregon has really undergone a philosophical shift. The lesson of 2003 as I see it is that Oregon voters WILL NOT support broad-based tax increases, even to fund absolutely essential services. The 2009 tax hikes are politically easier to sell, which is a smart move on the Dems part, but I'm not as confident as Dave Hunt is that Oregonians will be smart enough to see through the populist arguments headed our way during a referendum.

"Oregon took a step away from a philosophical orthodoxy"

I was kinda hoping that meant they were running the state more efficiently rather than just asking for more money.

The elitist BS about "essential services" and the idiots who make up the electorate at large is pretty amusing stuff in a state with a way higher than average voter turnout.

Perhaps people appreciate being robbed by their "betters" about as much as they enjoy being victimized by the permanent underclass.

Sid, it's not that simple. Business income taxes are on profits, not sales. If one business raises their prices to cover the additional tax and their competitor doesn't then the competitor may increase their market share enough to increase profits despite the increased tax while the price raisers profits drop (reducing their income tax so maybe that's what they wanted). Businesses don't price things based on the cost of production but on how much people are willing to pay. Raise prices and fewer people buy but you make more per unit, lower prices and more people buy but you make less per unit. Somewhere in there is a happy medium that maximizes profits. If something costs more to produce than people are willing to pay then it probably won't be made for long.

mp: Your "udder crap" comment is right on. A few years ago Nike spent something like $200 million on a failed business software installation. The difference is that government has to tell you when they screw up, businesses don't.

Do corporations pay taxes, or do they pass them off to their customers as a cost of doing business?

An excellent question, designed no doubt to stimulate thinking. The answer is that customers of the company's products, and shareholders (your 401K) pay these taxes, in some proportion. Taxing a public corporation is a pass-through to the public.

This is certainly not lefty orthodoxy, but it is arguable that it doesn't make sense to tax public corporations at all (private corporations are a different story, and should be taxed). The burden should be switched to individuals, where it already lies in effect. Then, we the public would not have to pay for corporate tax accounting departments, which are also paid for by customers and shareholders. Corporate profits would be taxed when distributed to individuals, as employee compensation or dividends.

Do corporations pay taxes, or do they pass them off to their customers as a cost of doing business?

Yes, corporations pay taxes. (Or rather, businesses do.) Whatever goods or services a business provides are subject to basic market forces. The nature of the corporation is to maximize income (dividends for shareholders), which means they sell their products at the highest price they can get in the current market. If a corporation can sell a widget for $100, they aren't going to sell it for $90 just because they keep their costs low and want to pass the savings onto their customers. (If they cut their price to $90, it's because they weren't selling enough widgets at $100). Whether their cost for the widget is $30 or $50 or $80, they'll sell it for as much as they can get.

So if their cost for the widget increases (say, from $50 to $55) due to taxes, guess what? They still won't be able to raise the price of a widget to $110 without cutting into widget sales.

Increases in corporate taxes come out of corporate profits. That means smaller dividends, but not higher prices for the customers. Because if a business could get away with charging higher prices for whatever they're selling ... they'd be doing it already.

Douglas K says: Increases in corporate taxes come out of corporate profits. That means smaller dividends, but not higher prices for the customers. Because if a business could get away with charging higher prices for whatever they're selling ... they'd be doing it already.

A bit simplistic... I wonder if you've ever run your own business before. Why did the price of so many products go up last fall when gasoline hit $4+ per gallon and other energy prices spiked? Not because everyone was all the sudden willing to pay more - but because of higher production/transportation costs. that's why. Don't sh*t yourself - businesses have to find ways to pass on their cost increases... sometimes they just reduce the cost/quality of their product/service rather than increase the price (e.g., notice the old half-gallon ice cream containers at the supermarket are now a few ounces less than a half-gallon now - albeit at about the same old half-gallon price...)

And taxes are a cost of doing business that impacts the entire market just the same as transportation/production costs.

A bit simplistic... I wonder if you've ever run your own business before.

Yes, simplistic, but basically true. And yes, I've run my own business for the past sixteen years. If my expenses go up (rent increase, health insurance costs, transportation) maybe I can raise my rates. But then again, if my costs go down, maybe I can still raise my rates. I raise my rates too high, I lose business. If I don't lose business, then I obviously wasn't charging enough to begin with.

Bottom line, I do what businesses do: I trim my expenses as much as possible and charge as much as I can, with the goal to maximize profit. I do that whether taxes go up or down. If taxes go up, yeah, they eat into my profits. But they won't magically increase the market value of my services. And a tax cut won't incent me to cut my rates and pass along the savings.

" I wonder if you've ever run your own business before".

Very interesting to watch the debates on this stuff. A legislator who has a small business will make a remark, then another legislator will say "But the business community believes....".

Folks, don't forget the individuals. OSBA does not control the views of all school board members, OEA does not think for all teachers (as anyone who has been in a staff room or a summer school class or otherwise around a bunch of teachers would know), not all environmentalists agree with every detail of the OLCV report card, not all business owners follow the NFIB or AOI or OBA script, and about a quarter of the voting population doesn't register with a major party.

<h2>Taxes are a cost just like rent, electricity, wages, etc. When the price of oil goes up do finished goods prices go up, down, or stay the same? Overtime, they will go up. If oil prices go up for just one company and all of its competitors for some reason do not get an oil price rise then that one company will have difficulty raising prices. The increase in taxes over all companies will tend to over time get passed on to consumers. It does not happen in one day but it happens.</h2>