US tax system reform is essential under this new Congress

Everybody loves potluck parties. Each person brings a dish to share, and the result is a feast! But we all know the guy who brings the measly bag of chips to the potluck. Nobody likes that guy, especially when you know that guy has a well-stocked pantry at home.

The American tax system can be compared to this potluck. Some people are bringing the much-needed fruits of their labor while others bring as little as possible and still eat like kings.

After the midterm election, the Republican Party now holds the majority in both chambers of Congress, and that means that the congressional agenda will change. There is an even more urgent need to find areas of compromise and common ground between the executive and legislative branches of government. On the short list of legislative priorities -- and a possible area for bipartisan compromise -- is tax reform. Congress will take a look at making permanent various tax credits, especially those that focus on business.

The current tax system is widening the already cavernous wealth gap, which not only harms the economy, but hurts people as well. We need to tackle the myth that large corporations pay a 35 percent tax rate. That may be the listed rate, but it is fiction. The reality is that if they have decent tax people, they don't pay that rate. They find loopholes, move their money overseas, and skirt the rules to effectively pay less. The system is intentionally complex and confusing to mask these corporate tricks. For example, General Electric Co. "pays an effective rate of less than zero in many years."

In addition, the richest 1 percent of Americans owns half of the country's stocks, bonds and mutual funds, yet this wealth is taxed at only 15 percent, while work is taxed at up to 35 percent.

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These are the tax policies that push the richest further away from everyone else, dividing our nation, undercutting our economy, and overburdening ordinary Americans.

We cannot continue to defend the idea that if the rich get richer, that will somehow make the poor better off. Pope Francis denounces this theory in favor of reality in Evangelii Gaudium, in which he writes: "Some people continue to defend trickle-down theories which assume that economic growth, encouraged by a free market, will inevitably succeed in bringing about greater justice and inclusiveness in the world. This opinion, which has never been confirmed by the facts, expresses a crude and naïve trust in the goodness of those wielding economic power and in the sacralized workings of the prevailing economic system. Meanwhile, the excluded are still waiting."

Recognizing that the "potluck" is unfair and that taxes are a matter of justice, reform is essential. I pray that as Congress addresses our overcomplicated and strategically confusing tax system, they keep in mind the common good and create a more just system that takes into account all people, not simply the elite few.


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