H&R Block Founder: The Rich Need To Pay More Taxes

By Justin Gardner | Related entries in Debt, Money, Republicans, Smart Things Said By Smart People, Taxes

In an op-ed I HOPE will get picked up across the country, Henry Bloch explains why taxes need to be raised on the rich ASAP.

From KC Star:

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.

He’s a registered Republican.

Your thoughts?


This entry was posted on Tuesday, August 2nd, 2011 and is filed under Debt, Money, Republicans, Smart Things Said By Smart People, Taxes. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

30 Responses to “H&R Block Founder: The Rich Need To Pay More Taxes”

  1. cranky critter Says:

    I agree, but of course such things are more true when republicans say them, right? LOL. Wonder if he’ll enjoy being an apostate. Let the unfriending begin.

  2. mw Says:

    Whether you think or agree that “rich paying more” is going to happen is to some extent about semantics and framing. I’ve no doubt that revenue increases will be be part of the second leg of cuts to come out of the debt ceiling legislation / super-committee. Boehner said that he was willing to agree to $800B of revenue increases in the Grand Bargain he was negotiating with Obama, then reinforced that this week in his speech on the floor of the house.

    To provide political cover for Republicans ,I expect this will come in a form that can be described as Tax Reform with flattening of brackets, expansion of the base, elimination of many loopholes, and perhaps even a reduction in the corporate rate. To provide political cover for Democrats the “rich paying more” aspect will be in the form of eliminating tax breaks and loopholes.

  3. Tillyosu Says:

    Balance the tax burden? I agree. In fact, the tax burden should be shifted downward.

    Currently, the top 5% of income earners pay more than 50% of the income taxes, but the bottom 50% of income earners pay less than 3%. Does anyone here really think it’s healthy for a democracy to give more than half its citizens an equal say in how national income is spent, but not an equal burden in contributing to that income? No wonder we have a spending problem.

    What’s that you say? Income inequality demands a progressive tax burden? Fair enough. But would it surprise you to learn that among industrialized nations, the U.S. has the most progressive tax structure already? You see, we demand that the top 10% pay 45% of the national taxes (when payroll taxes are included), but the top 10% only earn 33% of the national income. Me, I’d prefer a system where if the top 10% earns 33% of the income, they’d be responsible for 33% of the tax burden…you know, like in Sweden.

    By the way, if Mr. Bloch feels that his personal tax burden is not heavy enough, he is absolutely free to send a personal check to the federal treasury at:

    Gifts to the United States
    U.S. Department of the Treasury
    Credit Accounting Branch
    3700 East-West Highway, Room 622D
    Hyattsville, MD 20782

    Though I seriously doubt he has ever done so.

  4. mdgeorge Says:

    O/T but thanks to whoever stepped up and fixed the excessive moderation. It’s nice to see the discussion picking up a bit again. I missed out on everyone’s perspective while all the sausage-making was happening.

  5. Paul Says:

    Sorry but I’m not buying the whole “the rich are too highly taxed” meme, considering many on wall street have their income taxed at capital gain rates and don’t have to pay payroll taxes on income above 106,000 is why as Warren Buffet says people like him pay less taxes percentage wise then their secretaries.
    Taxes as a percentage of GDP is at a fifty year low but for some paying one cent of tax is one cent too many.

  6. Mike A. Says:

    @ Tilly
    “Currently, the top 5% of income earners pay more than 50% of the income taxes, but the bottom 50% of income earners pay less than 3%.”

    Yes and if the top 5% earn 99% of the income, I would assume they would be paying nearly 100% of the taxes.

    If the income levels between top and bottom are severely imbalanced, then of course they will pay a larger percentage of the total. Even if they have the exact same tax rate, it’s possible they will pay a dominate share of the overall tax bill. You have 10 people. The top two make $2M/yr, the bottom 8 make $10k/yr. At a 35% tax rate the upper 2% would pay 86% of the overall taxes. So what?

    I agree that both the top and bottom should pay the same PERCENTAGE of their income in taxes. If that’s not the case, then it’s not fair

  7. Tillyosu Says:

    @ Mike A.

    I totally agree. Fortunately, someone has developed a solution.

    @ Paul

    Yes but this op-ed wasn’t concerned with capital gains taxes or payroll taxes, it was concerned with income taxes. And you’re right, many wealthy on Wall Street have capital income, not ordinary income. But you know who does receive the majority of their income from ordinary income? Small business owners, because their business income passes through their ownership entity and is taxed at ordinary rates.

  8. kranky kritter Says:

    Does anyone here really think it’s healthy for a democracy to give more than half its citizens an equal say in how national income is spent, but not an equal burden in contributing to that income?

    Yes. I do. Doesn’t bother me a bit. It’s fair because we voted for representatives who set it up that way. That’s exactly how democracy is supposed to work. Wealthy Americans who are upset are free to move to a republic somewhere else.

    Besides, what about all the other taxes that are regressive? If you were really and truly concerned about fairness, you’d look at total tax burden, not just income tax.

    And as Mike point out, what about the fact that the top earners are earning most of the income in the first place?

    I agree that both the top and bottom should pay the same PERCENTAGE of their income in taxes. If that’s not the case, then it’s not fair.

    I don’t support that at all. There are plenty of other ways to conceptualize fairness that are just as defensible, if not more defensible. For example, one big part of the progressive nature of the tax code is that you essentially don’t get taxed at all until your income moves above some subsistence baseline. That makes WAY more sense to me.

  9. kranky kritter Says:

    … would it surprise you to learn that among industrialized nations, the U.S. has the most progressive tax structure already? You see, we demand that the top 10% pay 45% of the national taxes (when payroll taxes are included), but the top 10% only earn 33% of the national income. Me, I’d prefer a system where if the top 10% earns 33% of the income, they’d be responsible for 33% of the tax burden…you know, like in Sweden.

    The average tax rate in Sweden is almost 58%. So I think you’re full of sh!t. Would you prefer to pay WAY MORE TAXES if only the rates were less progressive and more “fair.” Not a chance. You’re just cherry-picking one aspect of the swedish tax system for the sake of winning an argument. And that’s the epitome of bad faith dialogue.

    Of course, I’m making a huge assumption here. My guess is that the idea of living in a heavy social democracy with really high (but fair, oh boy!) taxes and nearly omnipresent government makes you want to throw up. But maybe I’m wrong. Maybe you’re a closet Sweden-phile. Maybe you don’t rant against socialism. Maybe you love dishes that involve dried fish.

  10. Tillyosu Says:

    Yes. I do. Doesn’t bother me a bit. It’s fair because we voted for representatives who set it up that way. That’s exactly how democracy is supposed to work. Wealthy Americans who are upset are free to move to a republic somewhere else.

    “A democracy cannot exist as a permanent form of government. It can only exist until the majority discovers it can vote itself largess out of the public treasury. After that, the majority always votes for the candidate promising the most benefits with the result the democracy collapses because of the loose fiscal policy ensuing, always to be followed by a dictatorship, then a monarchy.”

    -Alexander Tytler

    BTW, when 10% of our population provides more than half of our national revenues, I would advise against suggesting they move somewhere else.

  11. Mike A. Says:

    cc (kk)
    I agree with your definition of fairness, but it seemed Tilly was making an argument for the opposite: a system where the wealthy pay a smaller percentage of the overall, and are therefore taxed at a lower percentage than the poor. This would be the only way to make his argument “fair”

  12. kranky kritter Says:

    Ahhm the renowned authority Alexander Tytler. He’s always right.

    BTW, when 10% of our population provides more than half of our national revenues, I would advise against suggesting they move somewhere else.

    I’ll drive them to the airport. Then I’ll give their jobs to folks left behind.

  13. kranky kritter Says:

    WTF. my comment keeps just disappearing? Three times now. I really need to get to the bottom of why tilly wants to adopt the swedish system with an average income tax rate of 58%. That seems so unlike him.

  14. Tillyosu Says:

    I’ll drive them to the airport. Then I’ll give their jobs to folks left behind.

    Yes! Because we all know that just about anyone could do the job of a hedge fund manager, or a CEO, or a real estate mogul right? In fact, I’ll do you one better, we should strip everyone of their jobs, and then hold a national lottery to redistribute them. The highest paying jobs should go to the best politically connected or most needy, of course.

    I really need to get to the bottom of why tilly wants to adopt the swedish system with an average income tax rate of 58%.

    Oh now you’re just being dishonest. Is that what I said? What I said was, we should adopt a system where the taxpayer pays taxes more in line with the proportion of the income they receive, like Sweden. If you’re opposed to that, then explain why. But don’t misrepresent. You’re smarter than that.

    Tilly was making an argument for the opposite: a system where the wealthy pay a smaller percentage of the overall, and are therefore taxed at a lower percentage than the poor.

    That is absolutely not what I was saying. I said that taxpayers should pay taxes based on their share of the national income (with a caveat – I would allow an allowance for income required for subsistence).

  15. Tillyosu Says:

    KK in all seriousness, you seem to be concerned about spending. Don’t you think that Congress would be under more pressure to control spending when more of their constituents have to actually fund it?

    I mean, if the poor vote mostly for democrats, and the democrats are the most reckless with the public finances (highest spenders) don’t you think that confirms my theory?

  16. Mike A. Says:

    @Tilly

    Didn’t mean to misrepresent. That was my impression of your first argument, which made the comparison between the absolute amounts of taxes paid by the rich without regard to the absolute amount of income received.

    I am an advocate of the flat tax system until it comes to the extreme poor. That’s where my liberal side comes out. I’m ok with that.

    If it wasn’t so dark in the winter, Sweden would be a great retirement destination.

  17. kranky kritter Says:

    KK in all seriousness, you seem to be concerned about spending. Don’t you think that Congress would be under more pressure to control spending when more of their constituents have to actually fund it?

    What exactly is your “theory?” State it in one sentence if you can. You have a tendency to flit to more convenient shadings when your contentions get countered? Is your theory that EVERYONE should pay higher taxes? Progressivity stems from us having a bigger rate gap between the least and highest taxed. If we fixed that by becoming more like Sweden, everyone’s ttaxes would go up.

    Just to be clear, I don’t care about government spending. I care about overspending. So long as the spending is sustainable based on revenue and doesn’t consume ever more GDP with government getting larger, I’m Ok with it. I think we’d likely be better off with less government in some instances, but not to the point where the country would be VERY different, just a little bit.

  18. Jim S Says:

    For many hedge fund managers they’ve rigged the game to where capital gains taxes are the only taxes they pay. Others who are extremely wealthy do the same thing. You can’t honestly distinguish that neatly between the two. No one in a position of power is seriously proposing damaging levels of taxation on the wealthy, in spite of Republican propaganda to the contrary.

    In addition overall tax burden and how it relates to income can’t be ignored. The burden on those people who get off so easily in Tillyosu’s mind from sales taxes, property taxes and payroll taxes can’t be brushed off so lightly.

  19. bongstar420 Says:

    If a hypothetical rich person does not want to pay taxes on monies they take (not earned, there is only so many hours a day and a person cannot be a billion times better then average), then they should not take it. The problem is that they want to take it but all of it not some of it.

    Hearing about how the rich are unfairly taxed is absurd. The income they took from productive workers in the first place was unfairly taken. They cheated the community into believing that it was OK for them to take thousands of times more then the average productive laborer.

    Tell you what, if the rich want what theyve got so bad they can have it. But only if everyone can too. Oh, wait! They wont be rich if everyone has as much stuff and power as they do.

    I do not see how someone can deserve a billion times the average. As far as I am concerned, the difference between bums and rich people is money.

  20. Tillyosu Says:

    My theory is that spending has been profligate because a majority in congress represented constituencies that won’t ultimately bear the burden of paying back the debt.

    It makes perfect sense. If you buy the premise that poorer voters tend to vote democratic, while wealthier voters tend to vote republican, then, in a highly progressive tax system such as our own, of course spending will get out of control. You see democrats can spend freely knowing that their own constituents will benefit, while republican constituents will pay.

    But I think what happened was that from 2006 to 2010 democrats overreached, and their spending became so wild that they drove spending to levels that were unsustainable, and consequently drove paying constituents in several districts to political activism. They strangled the golden goose, and it ended up biting them.

    So it’s no surprise to me that a majority think the rich should pay more in taxes, or that democrats are harping that they don’t pay their “fair share.” My point was that the numbers don’t bear out that story, and the only real way to get spending under control is to push the tax burden downward, so that the majority of Americans feel its effects. I fear that we’ve pushed the tax burden so far to the top that it has become undiversified and unstable. I shudder to think what would happen if that 10% decided they were tired of funding the spending binge of the other 90%, and that they are moving to “another republic,” as you so recklessly suggest.

  21. cranky critter Says:

    Yes! Because we all know that just about anyone could do the job of a hedge fund manager, or a CEO, or a real estate mogul right?

    If a few folks want to jump off the top of the ladder, everyone else will be happy to step up a rung or two. Maybe we’d miss them for a few weeks. But life would go on. Quite happily.

    Anyone who has been around awhile knows that NO ONE is irreplaceable. Not everyone would leave because they understand that their life of privilege is inextricably bound up with their nation’s. So they’d stay, even if the choice was made grumpily, and with lingering bitterness over sharing more than they’d prefer of their good fortune.

    I don’t resent wealthy Americans on any principal. Most of them have worked very hard, have scarce talents, and so deserve what life has brought them. Certainly some deserve admiration, not for their wealth but for their achievements and contributions. But I don’t think we ought to make heroes of them en masse as you seem to want to do.

  22. theWord Says:

    In a former life, I worked in the Brokerage and Insurance Industries for over a decade. I did it for several companies in several states. The one most common trait I saw (not that their weren’t exceptions) was the willingness to do anything to their customers to get ahead. They had a saying, “We take your money and turn it into our money” So my mileage varies too.

  23. Jacob Says:

    @Kranky:

    I doubt Tilly will return to this thread. It fits his MO (in my opinion). He does his best to derail a thread into partisan bickering through misinformation and obvious triggering and disappears when someone takes the time to wade through his mess enough to engage in a real conversation.

    I would not be surprised if he was compensated in some way for such services.

    When he commented last week that “this blog is not worth visiting anymore” I was hoping he wouldn’t …

    By the way, I hope Gerryf is reading this thread.

    @Gerryf: Are you reading this thread? How does this effect KK’s Republican credentials?

  24. cranky critter Says:

    I’ll answer for him. It doesn’t. As soon as I agree with anything a conservative says, I’m a tool again. As soon as I counter any of his “GOP = evil” rants I’m a false equivalence tool.

    The common ground is that some of the visitors here traffic primarily in partisan schtick. It’s sort of like a commercial interruption ” “we now interrupt this discussion for a word from a partisan douchebag.”

  25. Tillyosu Says:

    He does his best to derail a thread into partisan bickering through misinformation and obvious triggering and disappears when someone takes the time to wade through his mess enough to engage in a real conversation.

    I would challenge you, Jacob, to cite one piece of “misinformation” that I’ve given on this thread. All I strive to do is provide logical arguments, backed up with facts. I’m sorry if that “triggers” “partisan bickering.”

    What I don’t do is engage in ad hominem attacks that are devoid of ANY facts, and reek of incompetence.

    BTW, I did reply to KK above, but once again my comment is awaiting “moderation.”

  26. mdgeorge Says:

    @cc: “we now interrupt this discussion for a word from a partisan douchebag”….priceless!

  27. Jacob Says:

    @Tilly:

    1. I meant to write “misdirection” and wrote “misinformation. My apologies.

    2. It’s not an ad hominem attack because you and I are not having a debate. I was clearly expressing my opinion that your whole donklephant presence serves to disrupt and derail rather than discuss.

    3. Again, my opinion here: your schtick seems less “heartfelt partisan hackery” and more “sneaky manipulation”.

    Either way, I checked the comments and there’s nothing waiting to be moderated.

  28. Tillyosu Says:

    @Jacob

    1. Accepted. Still, I don’t see how presenting facts that contradict the main argument of the op-ed constitutes “misdirection.” Perhaps you could enlighten me.

    2. Surely you understand that you don’t have to be engaged in an actual debate with me to engage in ad hominem attacks? Your comment was clearly trying to undermine my argument with other by attacking me personally in areas unrelated to my actual argument. That is the definition of ad hominem. And to that end, I think ANY rational person would agree that your presence on this thread has served to “disrupt and derail rather than discuss,” more than any other comment, including my own.

    3. Well, you know what they say about opinions…

  29. kranky kritter Says:

    FWIW, I thought Til and I were doing OK.

    As to the charge of no moderated comments. I posted a response 3 times and it simply disappeared. I didn’t get “you have been moderated,” I got an empty comment box with no indication that that my comment had been acknowledged.

    Til, how about pursing the notion of subsistence level exemptions?

  30. Jacob Says:

    @Tilly,

    I truly wasn’t attempting to undermine your argument in this thread. KK was doing a better job at that than I could ever hope to.

    I figured you were done commenting on the thread and offered my opinion to KK.

    And to that end, I think ANY rational person would agree that your presence on this thread has served to “disrupt and derail rather than discuss,” more than any other comment, including my own.

    Agreed. Please forget I said anything and continue with KK. I triple dog dare ya’.

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