E-Newsletter: Resistance Report, October 10, 2017

Indivisible Bluegrass Resistance Report


October 10, 2017


Time for Tax Reform is NOW

Three speakers called for tax reform as the way to solve the state’s pension crisis at a joint meeting of Indivisible Bluegrass and Together We Will Bluegrass on Sunday, Oct. 8 at the downtown Lexington Library. About 75 people attended.

Legislators in Frankfort are currently debating how to fix the state pension plans, which are at least $37 billion short of what will be needed to meet its obligations over the next 30 years. Gov. Matt Bevin is expected to call a special legislative session early next month to address the crisis.

Three speakers called for tax reform as the way to solve the state’s pension crisis at a joint meeting of Indivisible Bluegrass and Together We Will Bluegrass on Sunday, Oct. 8 at the downtown Lexington Library. About 75 people attended.

Legislators in Frankfort are currently debating how to fix the state pension plans, which are at least $37 billion short of what will be needed to meet its obligations over the next 30 years. Gov. Matt Bevin is expected to call a special legislative session early next month to address the crisis.

“The plans are underfunded, as too many past budgets did not have sufficient revenue to adequately fund both the state’s pension plans and other vital public services,” said Larry Totten, President of Kentucky Public Retirees. “The Governor and Legislators are once again faced with either drastically cutting state services or funding pensions as they must be. The only real solution is to raise new revenues through tax reform.”

Current tax expenditures (breaks, credits, deductions and loopholes built into our tax code) will cost Kentuckians about 13 billion dollars this year, said Sarah Zeller, campaign coordinator with Kentucky Center for Economic Policy (KCEP). “When we talk about tax reform,” she warned, “we have to make sure that Kentucky doesn’t fall for ‘trickle down’ economics, a theory that giving tax breaks to the wealthiest individuals and corporations grows the economy and jobs, along with the revenue the state collects. Kansas, Louisiana, Ohio and many more states have not seen jobs or revenue increase as a result of income and business tax cuts.”

Gov. Bevin has indicated he wants to address the pension crisis now and tax reform at a later time. But Zeller said the two topics are not separate issues. “We need tax reform that cleans up special interest tax breaks to raise the revenue needed to fund pensions and start reinvesting in vital public investments,” she said.

“Currently, Kentucky has an “upside down” tax code in which the middle class pays almost twice as much, as a share of their income, compared to the top one percent,” said Tyler Offerman, Tax Justice Organizer with Kentuckians for the Commonwealth (KFTC). “Kentucky’s elected officials have never had the political courage to reform the system so that the wealthy pay their fair share.”

“Political change comes from public pressure, and public pressure comes from community organizing,” he said.

All three speakers agreed that the public’s message to lawmakers on the pension fund should be: Don’t cut it, fund it. They urged attendees to talk to everyone they know about tax reform, to write letters to the editor, to meet with local officials and community leaders, and to spread the word on social media.

“The time is right to create a movement
around economic justice.”

Tyler Offerman

To learn more about the state tax code and what you can do, go to the KFTC and the KCEP websites.


What Did We Ask Our MoCs In September?

When Indivisible Bluegrass members visited our Members of Congress (MoCs) last month, our questions focused on the Republican plan to overhaul our federal tax system. The plan would accomplish what Republicans had hoped to achieve with their failed health care plan: a massive shift of income from working class Americans to the top one percent.

We based our questions on a report produced by the Indivisible Bluegrass Research Group, titled Taxes, Tax Breaks And Who Are The Primary Beneficiaries? The report shows how Republicans want to push income equality in America to new heights by giving huge tax breaks to wealthy corporations and individuals, while slashing Medicare, Medicaid and other social welfare programs.

Changes to the tax code in recent decades have allowed America’s richest corporations and individuals to enjoy a 50 percent drop in their tax liability. At the same time, federal revenues remained fairly constant.

So who’s making up the difference?

Working-class Americans are, through higher social insurance taxes. (And a cap on social security taxes means the wealthy don’t have to pay their fair share.)

Between 1945 and 2017, the percentage of federal revenue from social insurance taxes rose from 7.6 to 33.5 percent, while the percentage from corporate taxes fell from 35.4 to 10.7 percent.

This dramatic shift in tax burden is linked to the Republicans’ revered “trickle-down” theory of economics, the idea being that when the rich make money, they create more jobs and everyone benefits. The theory, however, has been disproven repeatedly.

During the last 35 years—during which time there were multiple large tax cuts—the average salary of corporate chiefs grew nearly 1,000 percent, while the salary of average workers increased only 11 percent.

Clearly, our current tax laws favor the wealthiest Americans at the expense of everyone else. How to turn the tide? Indivisible Bluegrass supports these five changes to our tax laws:

  1. Close loopholes in the estate tax and raise the tax rate on estates worth over $5 million. The bulk of wealth in America should be earned, not inherited.
  2. Eliminate tax credits and breaks for profitable companies that are already paying little or no taxes.
  3. Raise the top marginal rate on capital gains and dividends, two sources of income that benefit primarily the top one percent.
  4. Eliminate the income cap on social security taxation. All Americans should contribute to social security programs on an equal basis.
  5. Keep and strengthen the Alternative Minimum Tax (ATM) so that the top one percent cannot get away with having the bulk of their income untaxed, which often happens now.

To see the taxation report and others produced by our Research Group, click here.


Let’s Give Ourselves a Pat on the Back

It’s tempting to feel overwhelmed by the never-ending outrages perpetrated by Trump and his supporters in Washington, which is why it’s important to take time to savor our victories, such as the crushing defeat of TrumpCare last month.

After nine months of resistance, Trump’s number one policy priority is dead for now. Indivisible chapters across the country held more than 400 local actions and made more than 420,000 calls to pressure senators in red states like ours to oppose the bill.

So on days when the news from Washington is discouraging, remember this:

As a movement, we are creative, compassionate and powerful. We don’t back down. We grow stronger each day. We are doing the impossible again and again.

Now it’s time to gear up for our next challenge: Crushing Trump’s Tax Scam. To better understand the facts, see Indivisible Bluegrass’s research report (see article above) and the tax explainer posted on Indivisible’s national website.

healthcare rally

This Indivisible Bluegrass rally held on March 17 outside Lexington’s Central Baptist Hospital was among the more than 400 local Indivisible actions across the country that helped defeat TrumpCare.


Upcoming Events

  • POSTCARDS IN THE PARK
    Sunday, Oct. 15, 2 p.m., University of Kentucky Arboretum, 500 Alumni Drive, Lexington. Join us in the picnic area to write postcards to our representatives in Congress. We supply postcards, pens and postage. Contact: Jane Eller.
  • ECONOMIC JUSTICE STRATEGY MEETING
    Tuesday, Oct. 17, 7 p.m., 250 Plaza Drive, Lexington. Sponsored by Kentuckians for the Commonwealth. Anyone interested in joining the fight for economic justice in our state is welcome. Contact: Tyler Offerman.
  • STUDY GROUP
    Wednesday, Oct. 25th, 7 p.m., Lexington Public Library – Tates Creek Branch, 3628 Walden Drive, Lexington, Kentucky 40517. We will be discussing Democracy in Chains by Nancy MacLean and Dark Money by Jane Mayer. Contact: Jane Eller.

For more information on these and other Indivisible Bluegrass events, go to the Events page of our web site.

Leave a Reply

Your email address will not be published. Required fields are marked *