My wife and I have served as doctors in a small rural community in West Virginia for the last 20 years. But back in the 1990s, I was able to break free from my medical work long enough to serve for two terms as an elected member of the West Virginia State House of Delegates.
During those years, I repeatedly heard the argument that we elected officials had to give one tax break or concession after another to various business sectors. The argument was that we must cut taxes on business to make West Virginia more attractive to business. Back in the ’90s, the whole notion of global competition was relatively new, and it added a sense of urgency and desperation about saving jobs. I didn’t like giving tax breaks to big business, because I knew that the rest of us would end up having to make up the shortfall. But I went along with it, voting for big business tax breaks along with the Democratic legislative leadership majority that pushed them.
When I was a boy back in the 1950s, corporations paid 30 percent of federal tax revenues. By 2001, corporations were paying only 9 percent, made all the worse by the Bush administration’s steady stream of new tax giveaways. The argument that big business needs tax breaks to remain competitive has been around for a long time. I was neither the first nor the last politician to be conned by that argument. But I know now that it is fundamentally a lie. All it has done is shift the tax burden to the rest of us.
While big business pays less and less tax, it continues to outsource jobs. Meanwhile, small businesses create 70 percent of new jobs in America, yet many successful small business people pay close to 50 percent of their income in federal, state, and local taxes. Middle-class families resort to having both parents work, sometimes more than a full-time job each, just to get by. The working poor can’t keep up, even before they are taxed. Now they are faced with cuts in benefits and services.