TACKLING THE AFFORDABILITY CRISIS Part 3

The U.S. affordability crisis is caused by low pay, high prices, economic inequality, and public policies skewed to favor wealthy individuals and corporations. Here are some strategies for tackling the affordability crisis.

THANK YOU to all of you who participated in or supported a No Kings rally (pro-democracy and anti-Trump) on March 28 in one way or another. Protests are a critically important strategy for tackling affordability and saving our democracy.

(Note: If you find a post too long to read, please just skim the bolded portions. Thanks for reading my blog!)

(Note: Please follow me and get notices of my blog posts on Bluesky at: @jalippitt.bsky.social. Thanks!)

The U.S. affordability crisis will require multiple strategies to effectively remedy it. My previous post discussed some longer-term strategies and an earlier post some short-term strategies. Here are some additional longer-term strategies. Generally, they require action by the federal government and, therefore, aren’t likely to happen soon.

Here are some strategies for addressing high prices:

Implement a windfall profits tax. The federal government should enact a windfall profits tax to stop price gouging by monopolistic businesses and by ones taking advantage of unusual market conditions. A windfall profits tax would tax away excessive growth in profits and, therefore, discourage price gouging because increased profits would be significantly reduced. However, if businesses continue to charge high prices and generate big profits, the tax revenue from the windfall profits tax could be used to provide assistance to working families facing economic hardship due to those increased prices.

With the spike in fossil fuel prices due to the Iran war, fossil fuel companies are likely to realize windfall profits. Other businesses may use the smoke screen of high fuel and energy prices as a pretext for raising prices beyond what’s justifiable and, therefore, generate windfall profits. The federal government should be prepared to tax those windfall profits and take other actions to keep prices down and protect consumers. [1]
Regulate surveillance pricing. With AI and high-powered computers, businesses gather extensive data on consumers and can then engage in sophisticated and opaque price manipulation to maximize what a consumer will pay (aka personalized or surveillance pricing). Sellers should be required to post prices clearly and provide the same prices to all consumers. This will prevent price gouging, discrimination, and bait and switch strategies that rip off consumers. Junk fees and other abusive pricing techniques should be banned.

For example, Uber and Lyft shouldn’t be allowed to charge you more (as they do) when your phone’s battery is low and they know you are in a hurry to book your ride. And landlords shouldn’t be allowed to collude through a large database of rental properties and AI analysis to jack up rents.

Here are some strategies for addressing affordability in general:

Eliminate the poverty wage business model. At least 16 U.S. billionaires owe their wealth to running corporations that pay workers poverty wages so the workers have to rely on taxpayer-funded public assistance to survive. Eight of these billionaires are associated with Walmart, two each with Amazon and Tyson Foods, and one each with Best Buy, Chipotle, Home Depot, and Starbucks. Large numbers of employees at these firms rely on Medicaid for health care and SNAP for food assistance. [2] Increasing the minimum wage would be one step in ending this public subsidy of corporate profits and shareholder wealth.
Reform the U.S. campaign finance system. Government policies are skewed to benefit the wealthy because of the way we allow election campaigns to be financed. The unlimited spending and lack of disclosure of who is contributing large sums of money have produced politicians and policies that favor the wealthy and their large corporations. This results in lower wages for workers and higher profits through higher prices that benefit shareholders and corporate executives. (See this previous post for more detail and ways to address this problem.)
Reduce economic inequality. Reducing economic inequality would tackle the affordability crisis in multiple ways. Extreme inequality destabilizes democracy, the economy, and society. Shifting some of the tax burden from low- and middle-class households to the wealthy could both reduces taxes for households struggling with affordability and increase the ability of the government to provide supports for working families such as affordable child care, paid family leave, housing subsidies, affordable health care, and a safety net when people hit hard times including unemployment benefits and food assistance. [3] Reduced economic inequality would also reduce the premiumization of the economy that drives prices up. (See this previous post for more detail.)

Many proposals to tax the wealthy are being considered at the state and local levels, [4] as well as at the federal level. At the federal level, the Billionaires Income Tax Act would tax the increase in value of assets (e.g., stocks) even if they aren’t sold. There are also two different wealth tax proposals, one from Senator Warren (D-MA) and Representative Jayapal (D-WA), the Ultra-Millionaire Tax Act, and another from Senator Sanders (I-VT) and Representative Khanna (D-CA), the Make Billionaires Pay Their Fair Share Act. There is also the Working Americans’ Tax Cut Act that would shift the income tax burden from low- and moderate-income households to those with incomes of over $1 million.

Reduced inequality benefits democracy and, when coupled with campaign finance reform, would produce politicians and policies that are more responsive to the needs of every day Americans, thereby addressing the affordability crisis. “Highly concentrated wealth leads naturally to concentrated political power.” [5] As Supreme Court Justice Louis Brandeis wrote almost 100 years ago, “We may have democracy, or we may have wealth concentrated in the hands of a few, but we can’t have both.”

Every politician, at every level, local, state, and federal, who’s serious about addressing the affordability crisis should embrace these strategies. I encourage you to contact your U.S. Representative and Senators and ask them to endorse them. You can find contact information for your US Representative at http://www.house.gov/representatives/find/ and for your US Senators at http://www.senate.gov/general/contact_information/senators_cfm.cfm.

For lots of good news, see Jess Craven’s Chop Wood Carry Water blog’s most recent good news Sunday post here.

[1] Reed, B, 3/25/26, “Dems call for prosecution of corporations using Trump’s illegal Iran war as cover to hike prices,” Common Dreams (https://www.commondreams.org/news/iran-war-price-gouging)

[2] Anderson, S., & James, R., 3/25/26, “Meet the 16 billionaires making bank by underpaying their workers,” Inequality.org (https://inequality.org/article/billionaires-low-wage-workers/)

[3] Meyerson, H., 12/3/25, “The $79 trillion heist,” The American Prospect (https://prospect.org/2025/12/03/79-trillion-heist-worker-pay/)

[4] Meyerson, H., 3/12/26, “Democrats get serious about taxing the rich,” The American Prospect (https://prospect.org/2026/03/12/democrats-get-serious-taxing-rich/)

[5] Bivens, J., 11/17/25, “Raising taxes on the ultrarich,” page 5, Economic Policy Institute (https://www.epi.org/publication/raising-taxes-on-the-ultrarich-a-necessary-first-step-to-restore-faith-in-american-democracy-and-the-public-sector/)

TACKLING THE AFFORDABILITY CRISIS

The U.S. affordability crisis has been growing for 45 years due to low pay and high prices. Here are some strategies for tackling it by increasing low pay that can be done at the state and local levels now. Unfortunately, Trump administration policies are exacerbating the crisis.

The U.S. affordability crisis is multifaceted and has been growing for 45 years, caused by low pay and high prices. There are many strategies for tackling the affordability crisis, some are presented below. However, many (most?) of the Trump administration’s policies are exacerbating the crisis. Therefore, one longer-term strategy for tackling affordability would be to participate in a No Kings rally (pro-democracy and anti-Trump) on Sat., March 28. Find an event near you here.

(Note: If you find a post too long to read, please just skim the bolded portions. Thanks for reading my blog!)

(Note: Please follow me and get notices of my blog posts on Bluesky at: @jalippitt.bsky.social. Thanks!)

The U.S. affordability crisis is multifaceted and caused by low pay and high prices. (Previous posts have discussed the factors leading to low pay and the reasons for high prices.) This post will discuss short-term strategies for increasing low pay. Many of these strategies would benefit from or require changes in federal laws or enforcement to be most effective. This probably won’t happen until Democrats take control of Congress and the presidency.

Here are some short-term strategies for increasing low pay that can be undertaken at the state and local levels now. [1] Every politician, at every level, local, state, and federal, who’s serious about addressing the affordability crisis should embrace these strategies. The first five should be core policies of the Democratic Party and every Democrat.

Reduce wage theft. Every year, over $15 billion is stolen from U.S. workers by employers who don’t pay the minimum wage, don’t pay required overtime pay, or don’t pay for all hours worked, as well as by ones who steal workers’ tips or don’t give workers their final paycheck. States can reduce wage theft through better enforcement of existing laws and strengthening laws, including by increasing penalties for violations. [2]
Raise the minimum wage. The federal minimum wage is only $7.25 an hour. If it had kept pace with workers’ increased productivity since the late 1960s, it would be over $24 an hour. The highest minimum wage in the U.S. is in Tukwila, WA, where it is $20.29. In D.C., it’s $17, while in Washington State it’s $16.28, $16 in California and $15 in Massachusetts. State and local governments can and should increase their minimum wages now.
Enact family friendly policies. Subsidies for child care are provided by the federal government and several states but typically fall well short of making child care affordable for many low- and moderate-income families. Some states and Mamdani in New York City are working to make child care free or at least affordable for all families. These policies have substantial economic benefits as they allow parents to remain in the workforce.

Paid family leave for the birth of a child exists in thirteen states and D.C., although not at the federal level. The U.S. is one of less than half a dozen countries in the world – and the only wealthy one – that does not have paid family leave.

Many wealthy countries provide a family allowance (i.e., cash benefits) for each child in a family. Proposals have been put forward in the U.S. for a $5,000 per year per child allowance. This could be achieved by increasing the child tax credit and making it fully refundable (i.e., a family who owes less in taxes than the amount of the credit would get a cash payment).

Strengthen unions and union organizing. Labor laws and enforcement of them need to be changed to make it easier to form a union and to require employers to sign a contract with unionized workers within a set time limit (e.g., 90 days) or to go to compulsory arbitration. Penalties on employers for violations of labor laws must be swift and significant. Much of this needs to happen at the federal level but states can act too. There’s strong support for unions among the public; they receive 70% approval ratings in polls.
Reform our tax systems. This is something that needs to happen at the federal level, but also at the state and local levels. Income taxes on wealthy individuals and businesses, particularly multi-national corporations, need to be increased. They have been declining for decades and dramatically so in President Trump’s two terms. Incomes should be taxed in a progressive manner (i.e., higher tax rates for higher incomes). Furthermore, there is no reason income made through gains on the sale of assets (i.e., capital gains) should be taxed at a lower rate than income earned from work, as is the case today. This is a tax break for the wealthy that was probably never fair and is inexcusable given the current economic inequalities and the affordability crisis for low- and middle-income households.

Wealth (not just income) needs to be taxed, including increases in wealth, which are functionally income even if assets are not sold. Inheritances and transfers of appreciated assets (which currently avoid any tax on their increased value) should be taxed. The most common form of middle-class wealth – a home – has what is effectively a wealth tax – the property tax. So, it only seems fair that other forms of wealth, held primarily by the wealthy, should also have a wealth tax.

Corporate income tax rates should be restored to pre-Trump levels at a minimum, and additional steps should be taken to counter multi-national entities’ sheltering of income offshore in low-tax jurisdictions. Stock buybacks should be banned as they were prior to 1980 as illegal manipulation of a stock’s price.

State and local governments can and should reform their tax laws now. For example, California is considering a wealth tax. In NYC, Mayor Mamdani has proposed a 2% surtax on individuals with incomes over $1 million and an increase in corporate income taxes. Massachusetts voters passed a 4% surtax on income over $1 million in 2022. It’s generating over $2 billion a year for education and transportation spending and, contrary to the scare tactics of opponents, millionaires are NOT moving out of the state. Nonetheless, the 5% of households with the highest incomes still pay a lower percentage of income in all state and local taxes in MA than the other 95% of households – 8% versus 10%.

Ban non-compete and mandatory arbitration clauses in employment contracts so workers aren’t prevented from moving to better paying jobs and/or jobs they would prefer. This can be done at the state and local levels, as well as at the national level.
Clarify the standard for who is considered an employee and increase penalties for misclassifying and mistreating workers as contractors rather than employees. This can be done at the state and local levels, as well as at the national level.

I encourage you to contact your state and local elected officials to ask them to increase the low pay of many workers by reducing wage theft, increasing the minimum wage, supporting unions, making the tax system fairer, and enacting or enhancing child care subsidies and paid family leave.

For lots of good news, see Jess Craven’s Chop Wood Carry Water blog’s most recent good news Sunday post here.

My next post will discuss additional strategies for tackling the affordability crisis.

[1] Meyerson, H., 12/3/25, “The $79 trillion heist,” The American Prospect (https://prospect.org/2025/12/03/79-trillion-heist-worker-pay/)

[2] National Institute for Workers’ Rights, retrieved from the Internet on 3/7/26, “Wage theft: Employers stealing workers’ wages,” (https://niwr.org/state-policy-clearinghouse/spc-wage-theft/)

PUBLIC POLICIES TO REDUCE ECONOMIC INEQUALITY IN AMERICA

Economic inequality is at record breaking levels in the U.S. The American oligarchy is powerfully wielding its economic and political power. Public policies can stop and reverse the growing economic inequality. See examples below. If Democrats or others want to garner support and votes, they should support policies to reduce economic inequality and create a secure economic future for working Americans.

(Note: If you find a post too long to read, please just skim the bolded portions. Thanks for reading my blog!)

(Note: Please follow me and get notices of my blog posts on Bluesky at: @jalippitt.bsky.social. Thanks!)

Economic inequality is at record breaking levels in the U.S. America now has 916 billionaires whose combined wealth is $8 trillion (yes, trillion). Their wealth has increased by over $1 trillion in the first nine months of 2025. Since the passage of the Republican tax cut bill in 2017, it’s increased from $3 trillion to $8 trillion. For comparison, the least wealthy 167 million Americans (half the population) have combined wealth of just $3.6 trillion. In other words, the combined wealth of 167 million Americans is less than half the wealth of the 916 billionaires. The rise in billionaires’ wealth reflects the transfer of profits of economic activity away from workers and to owners and investors.

A big part of this is the increase in the value of the stocks of companies these billionaires own and in which they invest. Provisions in the 2017 Republican tax cut bill (that were continued by the GOP’s Big Ugly Bill in July 2025) give huge tax breaks to corporations. For example. Alphabet (Google’s parent) gets $17.9 billion, Amazon gets $15.7 billion, and Microsoft gets $12.5 billion.

With their great wealth, these billionaire oligarchs have great political power, especially given the laws and court decisions allowing unlimited spending in political campaigns. This basically allows them to buy our elected officials, as Elon Musk bought Trump with the over $250 billion he spent on Trump’s campaign. “Highly concentrated wealth leads naturally to concentrated political power.” [1] As Supreme Court Justice Louis Brandeis wrote almost 100 years ago, “We may have democracy, or we may have wealth concentrated in the hands of a few, but we can’t have both.”

The oligarchs have been wielding their political power very effectively for the last 45 years, and especially in the last ten years. They’ve succeeded in getting policies enacted that enrich themselves and leave American workers not just short changed, but shafted. Public policies to provide economic security for working Americans will never happen if the oligarchs retain their political and economic power. (This previous post presented policies to increase workers’ incomes and this post highlighted policies to reduce the cost of living for them.)

Therefore, the policies that allowed economic inequality to grow over the last 45 years, and to explode in the last 25 years, need to be changed. A group called Patriotic Millionaires has proposed “The Money Agenda,” a set of policies that would reduce economic inequality and “permanently stabilize the economic lives of working people, stimulate wide-spread economic growth, and ensure prosperity and stability for America’s next 250 years.”

The Money Agenda includes four pieces of legislation. Here’s a quick overview of them:

The Equal Tax Act
- Increase tax rates on income from wealth (e.g., capital gains) so they are the same as the tax rates on income from work
- Close the loophole that allows the wealthy to give away appreciated assets and dodge anyone having to pay tax on their increase in value (i.e., the stepped-up basis loophole)
The Anti-Oligarch Act
- Phase 1: Stop the growth of economic inequality by putting a reasonable tax on the true income of the wealthy (e.g., including increases in wealth) and on the intergenerational transfers of wealth
- Phase 2: Reduce economic inequality by implementing a wealth tax on the ultra-rich
The “Cost of Living” Tax Cut Act
- Establish a Cost of Living Exemption of about $45,000 in order to eliminate income tax on income up to a reasonable cost of living for a single adult without children
- Pay for the lost revenue by putting a surtax on incomes over $1 million
The “Cost of Living” Wage Act
- Raise the minimum wage to a living wage for a single adult with no children, or about $21 per hour (roughly $45,000 per year for full-time work) and index it to inflation
- Protect workers from loss of income due to automation or AI

The Economic Policy Institute recently issued a report titled “Raising taxes on the ultrarich: A necessary first step to restore faith in American democracy and the public sector.” It states that if “policymakers are unwilling to raise taxes on income derived from wealth, the tax system can never be made as fair as it needs to be.” Its recommendations echo the provisions of The Equal Tax Act and The Anti-Oligarch Act above.

It also proposes:

Replacing the estate tax with a progressive income tax on those receiving an inheritance.
Raising the top marginal income tax rate back to its pre-2017 level (i.e., from 37% to 39.6%). This would generate revenue of over $30 billion a year. (Note: In 1980, the top rate was 70% and it was over 90% in the 1950s.)
Returning the corporate tax rate to 35% (where it was before the 2017 Republican Tax Cut Act reduced it to 21%). This would generate over $250 billion a year in revenue.
Closing tax loopholes that the ultrarich and corporations use to evade taxes.
Strengthening the IRS’s capability to enforce tax laws. The IRS estimates that $600 billion in taxes that are owed are not paid each year. However, in recent decades it has lacked the resources to enforce the laws and collect those taxes because Republicans have underfunded it.

If Democrats, or another party such as the Working Families Party, want to garner support and votes, they should support these policies to reduce economic inequality and the economic and political power of the American oligarchy. These and related policies would also provide economic security for working Americans. Democrats should be unequivocal in embracing economic populism and stop cozying up to the oligarchy and their PACs for campaign contributions. [2] To consistently win elections, Democrats need to loudly and unequivocally promote a vision of a more economically secure future for working Americans.

[1] Bivens, J., 11/17/25, “Raising taxes on the ultrarich,” page 5, Economic Policy Institute (https://www.epi.org/publication/raising-taxes-on-the-ultrarich-a-necessary-first-step-to-restore-faith-in-american-democracy-and-the-public-sector/)

[2] Reich, R., 11/3/25, “What the Democrats must do. Now!” (https://robertreich.substack.com/p/what-the-democrats-must-do-now) /

TRUMP AND THE REPUBLICANS DO NOT CARE ABOUT MAKING GOVERNMENT WORK BETTER

The Trump administration and the Republicans in Congress are not trying to make government work better. They’re focused on destroying our federal government and making it unable to perform functions we all rely on in our everyday lives. They also plan to give huge tax cuts to wealthy individuals and corporations. Please contact your members of Congress and ask them to oppose the draconian budget Republicans have proposed.

(Note: If you find a post too long to read, please just skim the bolded portions. Thanks for reading my blog!)

I probably don’t need to tell you that the Trump administration and the Republicans in Congress are not trying to make government work better. Rather, they want to destroy our federal government and leave it unable to perform functions we all rely on in our everyday lives.

This post will examine the Republicans’ budget proposal. My previous post documented the random slashing of personnel, which does not increase efficiency or make government work better. More examples of this have emerged in recent days. The Trump administration has disbanded the information technology group that was working to make the federal government’s public websites more user-friendly and functional. So, for example, it will no longer be working to make it easier and faster to get a passport from the Department of State or to use the free tax filing service of the IRS. [1] Many cybersecurity personnel from multiple agencies have been fired. Computer systems in the U.S. are not being effectively protected and Russia and other adversaries know this. Moreover, it has been reported that the Trump administration has stopped efforts to counter Russian cyberattacks. [2] Obviously, these actions are not doing anything to make the government more effective and efficient; quite the opposite.

Turning to the budget, the Republicans in Congress have proposed draconian cuts to agency and program budgets. They’ve set dollar-amount targets for cuts that reflect no analysis of need or efficiency. Their budget proposal has big cuts in everything that supports working Americans and their families. However, it includes big increases for defense and immigrant detention and deportation. It also extends and expands the very large 2017 tax cuts for wealthy corporations and individuals, which would cost $4.5 trillion over the next ten years. For example, the wealthiest 1% of Americans, with yearly incomes of over $743,000, would get an annual tax cut averaging $62,000. This is more than the yearly incomes of most of the 72 million people in the US who receive health insurance under Medicaid, many of whom are seniors in nursing homes. And make no mistake about it, Medicaid would have to be cut dramatically to meet the Republicans’ budget targets. [3]

These budget cuts are NOT about cutting waste or fraud; they are about cutting programs that working Americans rely on every day – from health care to nutrition programs to student loans to child and elder care. These deep cuts in programs are being proposed to make the tax cuts for wealthy individuals and corporations affordable, i.e., to keep them from exploding the budget deficit. Note that the Republicans’ budget proposal does NOT extend the tax credits that make health care more affordable under the Affordable Care Act (aka Obama Care) for 20 million low- and middle-income Americans, including three million small business owners and self-employed individuals. The Republicans’ budget proposal would also shift significant costs to state and local governments – which don’t have the capacity to pay them.

Despite the draconian programmatic cuts, the Republican budget proposal would increase the national debt by $4 trillion in less than two years.

It is abundantly clear that the Trump administration and Republicans in Congress, along with Musk and DOGE, have no interest in efficiency or making government work better. They want to break our government and turn our democracy into a dictatorship. Moreover, they act like bullies; being cruel and hurting people appears to be one of their goals. Why else would you separate children from parents and post gloating videos of immigrants in chains?

Mindless slashing of agency budgets and staff is harming our safety in multiple ways and weakening our economy. It will increase homelessness, hunger, and hardship for many; it will allow diseases to spread and environmental damage to grow.

I urge you to contact your US Representative and Senators and ask them to take strong action to oppose the draconian budget cuts Republicans are proposing.

If you have members of Congress who are Democrats, urge them to form a shadow cabinet and identify a party spokesperson. These individuals should critique the actions of the Trump administration on a daily basis by:

Identifying what it’s doing right and what it’s doing wrong.
Sharing data and people’s stories to document the damage that’s being done.
Presenting what Democrats would do differently and how people’s lives would be better if Democrats were running the government.

You can find contact information for your US Representative at http://www.house.gov/representatives/find/ and for your US Senators at http://www.senate.gov/general/contact_information/senators_cfm.cfm.

In my next post, I’ll share some profiles in courage of those resisting and good news about how the resistance is growing and proving to be effective.

[1] Hubbell, R., 3/3/25, “Every effort matters – now more than ever!” Today’s Edition Newsletter (Every effort matters—now more than ever!)

[2] Cox Richardson, H., 3/2/25, “Letters from an American,” (March 2, 2025 – by Heather Cox Richardson)

[3] Parrott, S., 2/25/25, “House budget would increase costs and hardship for many while providing huge tax breaks for a wealthy few,” Center on Budget and Policy Priorities (https://www.cbpp.org/press/statements/house-budget-would-increase-costs-and-hardship-for-many-while-providing-huge-tax)

CORPORATIONS ARE NOT PAYING THEIR FAIR SHARE IN TAXES

Large, profitable corporations are NOT paying their fair share in federal income tax. President Trump and the Republicans passed a huge tax cut for corporations in 2017 that exacerbated this problem. It cut the stated corporate tax rate from 35% to 21% (a 40% cut) and created new loopholes that let them reduce what they actually pay.

President Biden and Democrats in Congress are working to get big corporations to pay their fair share of taxes. The 2022 Inflation Reduction Act established a 15% minimum corporate tax and funded expanded tax enforcement. In addition, in 2021, the Biden administration negotiated a global minimum tax treaty with other nations but its approval has been blocked in Congress. [1] More on this later.

A study of the effects of the 2017 Tax Cut and Jobs Act found that the 342 large corporations that were profitable in every year from 2018 to 2022 – so it would be reasonable to expect that they would be paying significant taxes – actually paid just 14.1% of their profits in taxes (i.e., their “effective” tax rate). [2] This is only two-thirds of the tax rate stated in the law. In other words, these 342 corporations, as a group, paid an average of $55 billion less per year in taxes than the stated tax rate would require. [3] So, while big, profitable corporations were paying 14.1% of their profits in taxes, the average household was paying 13.6% of its income in federal income taxes in 2020. [4]

Moreover, 23 of these 342 profitable corporations paid NOTHING in federal taxes for the whole five-year period, despite being profitable in every one of those years! Even with $131 billion in profits over this period, these 23 big corporations (as a group) received tax refunds totaling almost $4 billion.

Another 109 of the 342 profitable corporations paid no federal tax in at least one year of the 2018 – 2022 period. In the years when they paid no tax, they, as a group, had $258 billion in profits but received over $14 billion in tax refunds.

Fifty-five of the 342 profitable corporations had effective tax rates of under 5% for the five-year period, including:

Bank of America: $139 billion in profits $5.3 billion in taxes 8% rate
AT&T: $ 96 billion in profits $2.5 billion in taxes 6% rate
Citigroup: $ 35 billion in profits $1.5 billion in taxes 3% rate
General Motors: $ 33 billion in profits $0.4 billion in taxes 3% rate
Nike: $ 19 billion in profits $1.0 billion in taxes 9% rate
T-Mobile: $ 18 billion in profits $-0.0 billion in taxes -0.4% rate
FedEx: $ 16 billion in profits $0.7 billion in taxes 6% rate
Net Flix: $ 15 billion in profits $0.2 billion in taxes 6% rate
Molson Coors: $ 7 billion in profits $0.3 billion in taxes 8% rate
Voya Financial: $ 4 billion in profits $-0.3 billion in taxes -8.0% rate
Darden Restaurants: $ 4 billion in profits $0.0 billion in taxes 8% rate
Office Depot: $ 7 billion in profits $-0.0 billion in taxes -4.6% rate

Also notable was that in an analysis by industry, the oil, gas, and pipeline industry had the second lowest effective tax rate of just 2.0%. Our tax policy has a long way to go if we want to use it to incentivize movement away from fossil fuels!

Here are some key statistics that make the case that corporations are not paying their fair share of taxes currently: [5]

The overall tax rate actually paid by corporations has fallen steadily from over 50% in the early 1950s to well under 20% today. (This is the cumulative effective tax rate for federal, state, and local taxes.)
In the 1950s, corporate taxes provided between 25% and 33% of federal revenue. For the past 40 years, corporate taxes have provided less than 15% of federal revenue.
As a share of the U.S. economy (GDP), corporate profits have risen from 8% in 1980 to 12% in 2022, a 50% increase. Meanwhile, corporate taxes have fallen from roughly 3% to 2% of GDP.

President Biden and Democrats are working to get big corporations to pay their fair share of taxes. The 2022 Inflation Reduction Act, passed by Democrats in Congress and signed by President Biden, established a 15% minimum corporate tax. More than half of the 342 corporations in the study cited above would have paid more in taxes with a 15% minimum tax rate. It’s estimated that it will generate over $200 billion in revenue over ten years from billion-dollar corporations. The Inflation Reduction Act also increased funding for enforcement of tax laws, which will reduce tax dodging by big corporations. [6]

In 2021, the Biden administration negotiated a global minimum tax treaty with other nations, but Congress has blocked approval of it. It would require multinational corporations to pay at least 15% of their profits in taxes. This would prevent corporations from avoiding taxes by shifting profits on paper to low tax countries. [7]

Note that Trump and the Republicans are stating in the presidential campaign that they will make the 2017 tax cuts permanent (they expire in 2025) and add on even more tax cuts. Among other things, they want to further cut the corporate tax rate from 21% to 15%. This would give the 100 largest, U.S. corporations, as a group, an estimated $50 billion a year in additional profits.

[1] Johnson, J., 9/27/24, “Dems name and shame companies paying executives more than they pay in federal taxes,” Common Dreams (https://www.commondreams.org/news/executive-pay-federal-taxes)

[2] Gardner, M., Wamhoff, S., & Marasini, S., Feb. 2024, “Corporate tax avoidance in the first five years of the Trump tax law,” Institute on Taxation and Economic Policy (https://itep.org/corporate-tax-avoidance-trump-tax-law/)

[3] Johnson, J., 2/29/24, “Corporate tax avoidance rampant during first five years of Trump-GOP law: Study,” Common Dreams (https://www.commondreams.org/news/trump-corporate-tax-avoidance)

[4] Anderson, S., Tashman, Z., & Rice, W., March 2024, “More for them, less for us,” Institute for Policy Studies and Americans for Tax Fairness (https://ips-dc.org/report-corporations-that-pay-their-executives-more-than-uncle-sam/)

[5] Anderson, S., Tashman, Z., & Rice, W., March 2024, see above

[6] Johnson, J., 9/27/24, see above

[7] Johnson, J., 2/29/24, see above