Thursday, April 16, 2009

Deep in the heart of taxes

It must be a sign of the poor shape of the economy, but for the first time I can remember Tax Freedom Day (the date when all Americans have, in theory, earned all money needed to satisfy their tax indebtedness to the government) arrived early this year on April 13. That not only is two days before Tax Day, but a full eight days earlier than it was last year. The reasons are that the recession has apparently caused tax collections to plummet even faster than incomes and the economic stimulus packages passed in 2008 and 2009 have specific tax cuts built in them for this year and next year. The worst year for Tax Freedom Day was back in 2000 when it took all he way until May 3 of that year for Americans to start earning their own money and be free of the yoke of a tax bill. That translates out to 123 days out of 366 (that was a Leap Year) or 33.6% of the time in order to pay off America's tax bill that year. By contrast in 1900 it only took 22 days for Americans to celebrate Tax Freedom Day. In 1950 that figure had risen to 90 days. This year there was not a whole lot of celebrating, despite the early Tax Freedom Day. Yesterday's concerted effort against the Obama administration was punctuated by Tax Day "tea parties" held at various venues across the country. Many of these were promoted by arch-conservatives like radio commentator Sean Hannity as well as by several hyped by FreedomWorks, the non-profit Washington conservative advocacy group headed up by former Republican House Majority Leader Dick Armey. In New York City another former Republican Leader of the House, Speaker Newt Gingrich, spoke before a crowd of thousands gathered in front of City Hall. FreedomWorks claims that the tea parties are designed to be non-partisan, but the overwhelming reality check is that they became opportunities for Republican dissent and possible future candidacies. One of the most noteworthy gathering was held on Boston Common, not far from the original Tea Party of Revolutionary War days. Thousands of people rallied against economic stimulus packages and excessive spending. To his credit Republican Governor Bobby Jindal elected to send out e-mails advising constituents where the tea parties were being held throughout the state. However, he did not elect to attend any of these himself. Jindal is under hot water from his fellow Louisianans, who object to his decision not to accept much of the stimulus money being thrown at the states by the Obama administration. Jindal has become the poster boy for Republican counter-attacks on how best to invigorate the staid economy, claiming that accepting the billions would create future problems for the state . Utah Governor Jon Huntsman (R) drew heavy fire from critics in Salt Lake City where he was booed for accepting $1.5 billion in stimulus monies. It is, indeed, a matter of being damned if you don't and damned if you do. In the meantime we've now passed the time for tax indebtedness and can look forward to earning enough money to pay next year's taxes. We're clear for the present unless, of course, some of us asked for extensions yesterday.

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