State Budget Crises:Tax The Rich!

The state budget shortfalls show no signs of abating. On the chopping block are education, health care, help for the poor and disabled, mental institutions, libraries, city services, fire departments, and more. Already, the pain and suffering of millions of people is escalating. Kids can’t afford to go to college. High schools and grade schools are closing down. The elderly are cutting back on their medications. And, as remaining services such as schools, toll ways and water, are privatized, (part of the game plan) costs are skyrocketing.

What is the meaning of this new stage of social destruction—and what can we do about it?

The crisis in the state budgets has come about as the result of a convergence of factors. On the one hand is the outright theft of the public coffers by financial speculators, energy and other corporations. On the other hand, the ongoing real estate crisis, along with the permanent unemployment due to automation and plant closures, means that state reserves cannot be replenished. More people are forced into poverty, putting tremendous pressure on Medicaid and other Federal programs that deal with poverty. The government’s answer is to push this burden onto the states, further intensifying the crisis. Meanwhile, the billionaires—the 1 percent of Americans who now own over 70 percent of all financial assets—continue to wallow in their wealth while paying little or no tax proportionate to their income.

As a result, we are witnessing the pending collapse of the state structures. Forty-eight states face shortfalls in their budgets for fiscal year 2010, totaling $196 billion or 29 percent of state budgets—“the largest gaps on record,” according to the Center on Budget and Policy Priorities. And, it’s not getting better. There is a combined gap of $375 billion for 2010 and 2011.
Most states are legally prohibited from running a deficit or from borrowing money to cover their operating expenses. Thus, they can 1) use their available reserves, 2) cut spending, or 3) raise taxes.

As far as the first option, most states have already used up their reserves. Therefore, most states are slashing spending. To back this up, there is a propagated viewpoint that budget cuts, regardless of the pain and suffering they may cause, are “a necessary evil.” The money has to come from “somewhere,” so the saying goes.

This is all well and good, but who is doing the suffering and who is basking in million dollar homes with servants, state of the art gyms and golf courses and not a worry in the world?

We, the people, must take matters into our own hands. There is no way out of this without raising taxes. But we are not talking about raising taxes on the working class. We have to respond with a clarion call that: “Cuts are unacceptable—the rich must be taxed.”
A small town in Oregon is pointing the way. Faced with severe cuts, two ballot measures were introduced that would raise taxes on wealthy residents and businesses to help pay for services. The tax increase would affect less than 3 percent of the population.

The bottom line is that you can’t have a just society in an unjust economy. The essentials of freedom are food, clothing, healthcare, housing and education. If we don’t control these things, we are going to continue to live in an unequal, unjust society. If we get our hands on these corporations we can create a society where everyone has what they need to lead a healthy, happy, cultured life.

A first step toward the kind of society that we need is to again raise the battle cry of the people: TAX THE RICH!