The ProPublica report on the taxes paid by the ultrawealthy is an important backdrop in a syndemic framework for evaluating health. A strong tax base contributes directly to health in several ways. Public parks, social services, education, community health centers, strong infrastructure, and Medicaid rely on tax dollars. Medical research is often funded by NIH seed money. Tax dollars have ramifications for the fight against racism, covering federal judges, federal support of states improving housing, policing, and education.
The basket of goods known to determine health relies on certain collective, public goods, which require a strong tax base. Grit and determination may help people take advantage of those goods or compensate for a lack of them, but the social determinants of health generally require access to education, food, positive workplace conditions, and living wages.
When the tax structure favors the ultrawealthy, the result is continuing the corporate welfare state. Failure to pay a living wage is a pervasive problem in the United States. Minimum wage workers have trouble paying rent and cannot afford a two-bedroom apartment in any US county. The Out of Reach report tracks the gap between income and housing.
In the New York mayoral debate on Wednesday, the affordable housing discussion was purely supply side, and reflected only ideas about development. A demand-side approach would be much better, yet no candidate used the housing question to examine why people cannot afford housing here. To say the housing does not exist hardly gets to the root of the problem. Workers are generally saddled with low wages and taxpayers fill the gap through financing social services, SNAP, and housing and healthcare subsidies.
As the low taxes are legal and embedded in the tax code, the “true tax rate” of 3.4 percent is sort of a “what-if” analysis as growth in wealth is not taxed as income, nor is it taxed at all unless an asset is sold. Abigail Disney explains how it is to be wealthy, and how protecting that wealth can cloud out other priorities. She also cites the concept that “government cannot be trusted with money.” The idea that the government is not the right entity to have, redistribute, or spend too much money as it does so either inefficiently or dishonestly with political motivations, while antiquated, is a predominant Republican viewpoint that perpetuates low taxes as a primary policy platform. The one feature that I see uniting old school Republicans and Trump voters is the use of distrust for government as an excuse for very low taxes on the ultrawealthy. Certainly, the wealthy vary in their wealth protection strategies and in their political views, and many wealthy people do not support candidates promoting low taxes for the ultrawealthy.
Some tax history reveals a change in the degree of willingness to tax income in the Reagan and post-Reagan era. Now, cries of socialism depict all taxes and all social programs as “socialism” in contrast to the historically higher tax rates associated with capitalism in the United States, a capitalist country.
From 1944 through 1951, the highest marginal tax rate for individuals was 91 percent, then 92 percent for 1952 and 1953, and back to 91 percent in 1954 until 1963. (I cannot imagine a Congress haggling over 91 or 92 percent now.) In 1964 tax year, it was lowered to 77 percent, and then to 70 percent for tax years 1965 through 1981. Even for the early Reagan years, it was 50 percent. After the experimentation at the 28 percent level in 1988, 1989, and 1990, it has remained under 40 percent. See IRS historical taxes, Table 23
Currently, the highest marginal tax rate is 37 percent. The social determinants of health probably require more from the ultrawealthy to create a sustainable tax base that fosters opportunity. If taxes were to be kept low, eliminating corporate welfare by requiring large corporations to pay higher wages would alleviate some of the burden shouldered by the taxpayers—Should my taxes go to SNAP or housing assistance for an Amazon or Walmart employee? This US Government Accountability Office report shows that they do.