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Where the money is: a lesson from CTU’s founders

This week Dirt Diggers Digest highlights the legacy of Margaret Haley and Catherine Goggin, two Chicago teachers who founded a federation in the 1890s which grew into the first teachers union in the nation and ultimately the Chicago Teachers Union.

When the board of education used a purported fiscal crisis to demand reductions in teachers’ salaries, Haley and Goggins “launched an intensive investigation of tax dodging by some of the largest corporations in the city, finding that property tax underpayments amounted to some $4 million a year.” That was a lot of money in 1890.

Today in Wisconsin, Governor Scott Walker is demanding that teachers and other public employees surrender not just pay and benefits, but their right to collective bargaining.  This would allow Walker and other officials to dictate terms of employment.

He says this is needed to meet a budget gap projected at $3.6 billion over the next few years.  But his recent enactment of $140 million in business tax breaks give credence to charges that his real agenda is destroying public employee unions.

This turns out to be a pattern around the nation — in states with Republican governors, as Michael Winship points out at Huffington Post. In Michigan, Rick Snyder has demanded $180 million in concessions from public workers and a billion dollars in cuts to schools, universities and local governments; he’s also pushing $1.8 billion in corporate tax cuts.

In Arizona, Jan Brewer passed $535 billion in corporate tax cuts, and now plans to kick a quarter of a million people off Medicaid.  In Florida Rick Scott is cutting essential services to pay for $4 billion in corporate and property tax cuts.

Closing deficits is not these folks’ top priority.

Last week we cited HuffPost’s report that two-thirds of corporations in Wisconsin pay no taxes, and the corporate share of tax revenue has fallen in half since 1981, according to the state’s revenue bureau.

Addressing the rhetoric of “shared sacrifice” coming from Walker, Real News Network’s Paul Jay points out that Wisconsin’s billionaires have seen their wealth continue to grow while everyone else suffers.  He says that restoring the state’s estate tax – which has brought in nothing for two years – to 2008 levels would raise $158 million a year.  Restoring it to its 2001 level, and throwing in a million-dollar exemption, would solve the state’s budget problems neatly.

Corporate tax avoidance is the target of US Uncut, a new group modeled on a movement in Great Britain.  They protested this weekend at Bank of America, which paid zero taxes [in 2009] and made over $10 billion in profits last year.

According to the Guardian, a GAO report found that 83 of the top 100 publicly-traded corporations in the U.S. use corporate tax havens to minimize their tax bills.  US Uncut says that big corporations dodge up to $100 billion in US taxes every year.

That’s a lot of money, even in 2011.  By coincidence, it’s the same amount that Republicans in Congress promised to cut from the federal budget.

In Chicago, CPS faces huge deficits, more school closings are promised, and state legislation backed by the mayor and his successor would take away teachers’ collective bargaining rights.  Meanwhile a new analysis shows that half of TIF subsidies have gone to the city’s most profitable corporations, with much of the rest going to developers of high-cost housing.  Expect that program to come under increasing scrutiny.

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Category: federal budget, history, labor, state budget, taxes


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