Op-ed by Henry W. Bloch, co-founder of H&R Block Inc.:
Something has gone terribly wrong in Washington, D.C. Over the last two decades, both Republicans and Democrats have put our country in a financial dilemma largely caused by one simple fact: The government borrows nearly 45 cents for every dollar it spends. Now the ongoing debt-ceiling fiasco has brought the nation to the edge of a fiscal precipice.
I am a registered Republican. But I speak out on this subject not to support the Republicans’ or Democrats’ position. Instead, I advocate for average, middle-income Americans. Their voices are too often ignored in policy debates.
I am appalled at the behavior of this Congress, which now seems more intent on political maneuvering for power than on making rational public policy. For example, some Republican members of the House appear to be refusing to agree to any solution for which President Obama can claim any credit. Consequently, our country finds itself on the brink of defaulting on the nation’s debt, not because of the actions of the American people but because of the actions of certain elected officials.
Clearly we have borrowed from our future to pay for today’s benefits. That practice has now caught up with us. We need Congress to formulate a plan to deal with this problem. The debt gap cannot otherwise be closed. A balanced approach — a combination of spending cuts and increased revenue, not merely spending cuts — is the right answer.
I’m not the only one who feels this way. A large majority of Americans are calling for compromise and a fair and balanced approach to resolving this debt crisis. The average American understands that digging our way out of this crisis will require shared sacrifice in the form of fewer benefits and higher taxes on the top income earners. Yet our political leaders continue to go about their business of trying to “one-up” one another and score political points that they will look to cash in when they run for re-election in 2012.
I do not understand some Republicans’ resistance to the idea of tax increases on the wealthy. The argument we have been hearing from some politicians about the rich being the “job creators” is misguided. First of all, let’s not forget that our economy was doing better and the nation’s unemployment rate was lower before the Bush tax cuts, which benefited the top 1 percent of earners the most. Secondly, one would be hard-pressed to prove that low tax rates result in increased job creation. Companies today are holding record levels of cash, yet unemployment remains stubbornly high.
I have been a student of the U.S. tax system for more than half a century. From the mid-1930s to the early-1980s, the marginal tax rate for the highest income earners in this country was between 68 percent and 94 percent. That’s double and triple of what it is today. Yes, it’s time we balance the budget, but it is also time we balance the tax burden.
The strength of our political system has always been our elected officials’ ability to put the country’s interests first and come together in the spirit of compromise.
Those of us earning more than $250,000 a year are very fortunate. We have an obligation to help our nation overcome this challenge. While I don’t look forward to paying more taxes, it must be done. And it’s a small price to pay for living in this wonderful country. Responsible change that promotes good public policy and tax fairness is to be welcomed.