Thom Hartmann: Nobles Need Not Pay Taxes

A new aristocracy is taking over not just the United States of America but also the world. Proof of how far along it has come was in an article by Glenn R. Simpson in the January 28, 2005 edition of The Wall Street Journal.

"European countries have been steadily slashing corporate tax rates," wrote Simpson, adding, "...between 2000 and 2003, one nation after another has moved toward lower corporate rates with fewer loopholes."

On January 31, 2005, the Journal followed up with another story ("Tax Showdown Promised by EU Chief") pointing out that "...the new president of the European Commission launched a blunt attack on French and German efforts to end tax competition among European Union countries."

Ironically, EU leader José Manuel Barroso is also quoted in the Journal as saying: "Corporatist vested interests are the most important problem, be they from the left or the right."

This is more than just a tax cut story. It's about a fundamental shift in power and wealth from average people and the governments they had formed to represent them, to the capture of those governments and economic enslavement of their people by corporate aristocracies.

In it, Europe is simply following the lead set out by the United States, starting with the Reagan/Bush administration, when, in 1983, corporate taxes revenues were slashed to a low not seen since 1929.

This isn't the first time this has happened. Marc Bloch is one of the great 20th Century scholars of the feudal history of Europe. In his book "Feudal Society" he points out that feudalism is a fracturing of one authoritarian hierarchical structure into another: the state disintegrates, as local power brokers take over.

In almost every case, both with European feudalism and feudalism in China, South America, and Japan, “feudalism coincided with a profound weakening of the State, particularly in its protective capacity.”

Whether the power and wealth agent that takes the place of government is a local baron, lord, king, or corporation, if it has greater power in the lives of individuals than does a representative government, the culture has dissolved into feudalism.

Bluntly, Bloch states: “The feudal system meant the rigorous economic subjection of a host of humble folk to a few powerful men.”

This doesn’t mean the end of government, but, instead the subordination of government to the interests of the feudal lords. Interestingly, even in Feudal Europe, Bloch points out, “The concept of the State never absolutely disappeared, and where it retained the most vitality men continued to call themselves ‘free’…”

The transition from a governmental society to a feudal one is marked by the rapid accumulation of power and wealth in a few hands, with a corresponding reduction in the power and responsibilities of governments that represent the people.

Once the rich and powerful gain control of the government, they turn it upon itself, usually first eliminating its taxation process as it applies to themselves. Says Bloch: “Nobles need not pay taille [taxes].”

Or, as Glenn Simpson noted in the Wall Street Journal, "General Electric Co., for example, reported paying an effective tax rate of 19% last year on world-wide income, compared with 26% in 2003."

Corporations are taxed because they use public services, and are therefore expected to help pay for them - the same as citizens.

Corporations make use of a work force educated in public schools paid for with tax dollars. They use roads and highways paid for with tax dollars. They use water, sewer, and power and communications rights-of-way paid for with taxes. They demand the same protection from fire and police departments as everybody else, and enjoy the benefits of national sovereignty and the stability provided by the military and institutions like NATO and the United Nations, the same as all residents of democratic nations.

In fact, corporations are heavier users of taxpayer-provided services and institutions than are average citizens. Taxes pay for our court systems, which are most heavily used by corporations to enforce contracts. Taxes pay for our Treasury Department and other governmental institutions which maintain a stable currency essential to corporate activity. Taxes pay for our regulation of corporate activity, from assuring safety in the workplace to a pure food and drug supply to limiting toxic emissions.

Under George W. Bush, the burden of cleaning up toxic wastes produced by corporate activity has largely shifted from polluter-funded Superfund and other programs to taxpayer-funded cleanups (as he did in Texas as governor there before becoming President).

Every year, millions of cases of cancer, emphysema, neurological disorders, and other conditions caused by corporate pollution are paid for in whole or in part by government funded programs from Medicare to Medicaid to government subsidies of hospitals, universities, and research institutions funded by tax dollars through the NIH and NIMH.

Because it's well understood that corporations use our tax-funded institutions at least as heavily as do citizens, they've traditionally been taxed at similar rates. For example, the top corporate tax rate in the US was 48% during the Carter administration, down from the a peak of 53% during the Eisenhower and Kennedy years.

Today it stands at 35%, but in May of 2001 Bush administration Treasury Secretary Paul O'Neill suggested there should be no corporate income tax whatsoever. This was the opening salvo in a very real war to have working people bear all the costs of the commons and governance, while the wealthy corporate elite derive most of its benefits.

And, as George H.W. Bush pointed out when he was president, this isn't just an American phenomenon. It's a New World Order.

"The corporate tax-cutters of recent years stretch from Portugal, where the rate has dropped 10 points to about 17%," notes The Wall Street Journal's 28 January article, "to Austria, down nine points to about 25%."

A cornerstone of the conservative movement to consolidate power in the hands of a wealthy corporate elite, the campaign to end corporate income taxes altogether - and leave the rest of us to pick up the entire tab for corporate use of our institutions and corporation despoliation of our commons - first picked up steam when Reagan came to power in 1980.

As Cato Institute adjunct scholar Richard W. Rahn noted in Rev. Moon's Washington Times, "The idea and practice of the corporate income tax has been dying slowly for the last two decades."

The December 1, 2004 Washington Times article, titled "End Corporate Income Tax," reflects a powerful and growing movement not just in the United States but across the world. So-called "free trade" agreements and supranational institutions like the WTO have given multinational corporations control of the economic lives of nations that were previously democracies. Holland, Ireland, Germany, Portugal, Belgium - the list goes on and on.

In a feudal state, as Bloch reminds us, the nobles need not pay taxes.

And as Mussolini told us, the newest form of feudalism has been reinvented and renamed. He called it "fascism" - a word that was defined by The American Heritage Dictionary (Houghton Mifflin Company, 1983) as " fas-cism (fash'iz'em) n. A system of government that exercises a dictatorship of the extreme right, typically through the merging of state and business leadership, together with belligerent nationalism."

We are quickly shifting toward a corporate-run state in countries all over the world. It appears "free" and even allows elections, albeit they are only among candidates funded and approved by corporate powers, held on voting machines owned by those corporate powers, and marketed in media owned by those corporate powers.

But this bears little resemblance to the democratic republic envisioned by our nation's Founders.

If our elected representatives - and those of other "free" nations - don't quickly wake up and reverse course, we will soon again be in a feudal world. And it's up to us - We the People - to help them awaken.

Thom Hartmann (thom at thomhartmann.com) is a Project Censored Award-winning best-selling author and host of a nationally syndicated daily progressive talk show. www.thomhartmann.com His most recent books are "The Last Hours of Ancient Sunlight," "Unequal Protection," "We The People," "The Edison Gene", and "What Would Jefferson Do?."

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