Rising Kentucky Voices: Coming Together for Tax Fairness
Central KY Chapter Member Sarah Martin was among a group of folks with low-wage work experience who went to Washington, D.C. in April to lobby for closing corporate tax loopholes and raising the minimum wage. Right now, these corporate tax loopholes exist as the "tax extenders" that Sarah will reference in this blog. Congress isn't expected to act on these until after the election.
Corporate tax loopholes also exist as "inversions." (Hang in there, and remember, tax policies language is wonky to keep us away!) Those "inversions" recently allowed Pfizer to claim itself as a United Kingdom company, thereby avoiding paying taxes in the U.S. With that in mind, Senator Carl Levin (D-MI) and 13 Senate co-sponsors (including Sen. Elizabeth Warren), and Representative Sander Levin (D-MI) with nine House co-sponsors, introduced companion bills yesterday to close these “inversion” loopholes.
We hope to learn more, and track the involvement of Kentucky's delegation. In the meantime, check out Sarah's story about why she went to Washington, and why she'll go back.
It’s 8 AM on a Monday morning and as our bus creeps through D.C. traffic, CKY Chapter Member Greg Capillo, CKY Chapter Organizer Beth Howard, and myself have a quick breakfast. We think we are on our way to the White House to participate in a direct action regarding immigration reform and deportation policies. While that plan is true, there is a “quick” stop to make before we arrive at 1600 Pennsylvania Avenue. It turns out that we are on our way to a secret action. We are told to not broadcast any information on social media or to communicate with anyone what we’re doing until the action is complete. We are also told that when the buses arrive, we need to exit as quickly as possible, and that conference staff, in fluorescent vests, will direct us to run inside of the building to gather in the lobby.
The three of us look at one another and don’t know what to think. We were in Washington, D.C. because KFTC had been invited to attend a joint summit between the National People’s Action and the National Domestic Workers Alliance. NPA is a national network of grassroots organizations that work for direct action and to advance a national economic and racial justice agenda. NDWA works at the national level to give domestic workers dignity, fair wages and treatment in their respective workplaces, and a voice for the millions of their primarily female member base.
We had spent the previous two days attending workshops about economic justice, mass incarceration and the prison-industrial complex, immigration reform, the consumer debt trap, as well as learning narrative and framing strategies for our issue work. We had heard so many great stories of triumph and saw how two social justice groups, with similar goals, could merge and be twice as powerful. We each decided to be cautiously optimistic and go with it.
We are given an informational leaflet that informs us that from 2008 to 2012, General Electric did not pay ANY taxes. In fact, our federal government gave G.E. a $3 BILLION refund to add to the $27 BILLION in profits they made. You read that right, friends. GENERAL ELECTRIC DIDN’T PAY ANY TAXES FOR FOUR YEARS AND RECEIVED BILLIONS IN REFUNDS ON TOP OF THEIR BILLIONS MADE IN PROFITS. Can you even being imagine having the “luxury” of not paying your taxes for four years? If I didn’t pay my taxes for that long, heck, I would be writing this post from jail.
Corporate Welfare & The Misplaced Priorities of Most of The Kentucky Delegation
How can this morally reprehensible theft happen you ask? Welp, it turns out there’s this thing called a tax extender that makes it legal for GE to not pay taxes. When temporary tax breaks are given to a group, in this case global corporations like G.E., Congress will “extend” the tax break by routinely voting for it to be kept in place and not letting it expire. This happens constantly and with little resistance from either side of the isle.
Sounds shady, right? It get’s even better as we dig deeper with our allies at Americans For Tax Fairness. Their research from 2014 shows the following: “This year Congress is debating whether to renew 55 tax breaks — known as “tax extenders” — worth up to $700 billion over 10 years, which primarily benefit corporations like General Electric, Goldman Sachs and Citigroup.” ATF goes on to write, “Two major loopholes — the Active Financing Exception and the CFC look-through rule — both help corporations shift U.S. profits offshore to tax havens. They cost Americans $80 billion in lost tax revenue over 10 years. That’s money we should be using to rebuild our schools, improve health care, invest in new infrastructure and create jobs.”
Apparently G.E. has lobbyists that pressure so often and so hard for this “active financing exception”, i.e. corporate welfare, that it’s commonly referred to as the “G.E. loophole”. In fact, G.E.’s Vice President and Senior Counsel of Tax Policy & Planning, John Samuels, got down on bended knee in 2008 to beg NY Rep. Charles Rangle, to protect their precious tax loophole. Congressperson Rangle was the then-chairperson of the House Ways and Means Committee, and conveniently the individual that held the authority to pass or put a stop to this immensely profitable tax shelter structure.
With this information in mind, and with what we had all learned and experienced so far that weekend, our group found out upon arrival that we were going to an action inside the corporate headquarters of General Electric, the belly of the beast itself, to demand that G.E. pay their fair share of taxes. It was as if all of us were contained in a collective can of Ale-8 and the leaders of NPA and NDWA shook the can as hard as possible, and then popped its top.
We flooded into the lobby, having around 500 people there in total, while another 500 conference attendees were a few blocks away engaging in a similar action at the D.C. office of Koch Industries. It was at that moment that we realized, “stuff was getting real!” As we held our signage and began to chant “Pay-your-fair-share!” over and over, we looked upwards into the concave center structure, all encased in glass. The noise was reverberating and, at times, deafening. All sorts of employees came to their respective windows and looked down at us. Some took pictures; some just shook their heads.
Testimony was given in the foyer as conference leaders went to the top floor to present G.E.’s CEO, Jeffery Immelt, with a letter sharing our grievances. The letter was not accepted nor would any G.E. representative meet with the conference leadership team; Mr. Immelt and others present would not even look at the letter. Despite of that, we would not let our momentum be crushed and we would not let our spirits dampen. Besides, we had other actions to participate in, legislators to meet with, and traffic to block.
Taking Action: The White House & A March on Congress
The rest of our day was focused on the aforementioned direct immigration action at the White House. Our collectively merged action groups from G.E. and Koch Industries called on President Obama and Congress to fix our broken immigration and deportation systems. We prayed and held vigil for the passage of fair legislative reform to heal the 11 million families affected and torn apart by this crisis.
We watched as 12 of our conference sisters and brothers hunkered down in front of the White House gates to protest. These friends were NDWA and NPA members, half of whom were undocumented. All 12 were arrested as we sang songs and chanted their names, along with words of encouragement. They were risking so much to witness and make systemic change.
As the White House concluded, we all headed down Pennsylvania Avenue for a mass action via a “March on Congress”. We were expertly guided to the intersection of 9th and Penn. Ave and then we stopped. The traffic lights changed and nobody moved. Beth, Greg, and I, again, looked at each other and could not believe what was happening. 1,000 people just stopped in the middle of a downtown D.C. street, the U.S. Capitol facing us in the distance. We had to laugh but you couldn’t really hear it over the drone of car horns blaring as well as our portable emcees rallying us, giving testimony about the need for economic justice and to raise the minimum wage.
It was utterly bizarre and awesome all at the same time.
After a second intersection takeover at 6th and Penn Ave, it all culminated in an action on the hill entitled the “Battle for the Capitol” where Minnesota Rep. Keith Ellison and others spoke in favor of increasing the minimum wage and got participants fired up and ready to lobby their elected officials. This is one of the reasons we came to lobby the Kentucky delegation. As current and previous low-wage workers, Greg and I wanted to talk with our Kentucky delegation about the need to raise the wage in our home state.
Our agenda was 1) to ask our Kentucky delegation to promote the availability of MACED’s How$martKY initiative, helping rural utility co-ops in Eastern Kentucky work with consumers on getting energy efficient retrofits in homes and businesses. 2) to voice our support of H.R. 1010, a congressional bill to incrementally raise the minimum wage to $10.10/hr, 3) along with our NPA allies, ask for support on policies that would generate billions and benefit all Americans. One such piece of legislation is H.R. 1579, the “Inclusive Prosperity Act of 2013”, which would tax a ½% each on the trading of every derivative, stock, bond, and foreign currency exchange in our nation’s financial sector. This legislation would generate upwards of $350 billion per year to invest in jobs, infrastructure, public health, and education – all the necessities that some of the Kentucky delegation claim we cannot afford. Clearly, with good policy, we can.
We had a great meeting with Rep. Yarmuth’s staff and were delighted to know they supported all of the initiatives we presented. We also met with Rep. Andy Barr in person, and with staff from the offices of Rep. Hal Rodgers and Sen. Mitch McConnell. Those meetings did not go as well. While everyone was supportive of How$mart, it was clear that we had different visions for Kentucky’s future. They opposed raising the minimum wage increase, taxing financial transactions, and closing the corporate tax loopholes. This opposition was voiced in the face of a growing wealth gap and the clear disparities that are impacting us right here in our Commonwealth.
According to the Kentucky Center for Economic Policy, raising the wage to $10.10/hr, for example, would lift the wages of one in four Kentucky workers. It would also benefit more than one in five of the state’s children by increasing the earnings of at least one of their parents. Raising the wage would have real impacts on Kentuckians’ lives. The average age of a minimum wage worker is 35 years old. 88% of minimum wage workers are not teenagers. More than half are women, and 28% have families. Mayberry, this ain’t.
The 2014 Federal Poverty Guidelines from the U.S. Department of Health & Human Services lists a one-person household making $11,670 or below per year as living at poverty level, $15,730 for a two-person household. A person making minimum wage, at $7.25/hr, can only hope to make $13,977. This is before state/federal taxes or ANY other deductions occur. Why is this okay? Why is it not considered deplorable that one of the wealthiest countries in the world will not legally allow for a citizen to, at a minimum, make a living wage that would see them lifted out of poverty, not perpetually mired in it?
And what if that two-person household happens to be a single parent with a child? Kentucky families and workers deserve financial stability and security, but we won’t get there with representation in Washington that keeps our wages suppressed and blocks investments in our families and communities. That is wrong. It is so very wrong on every level that it is morally bankrupt. With the exception of Rep. Yarmuth, the Kentucky delegation is clearly part of the problem. This experience really clarified for me how we are living in an America that is like the film “The Matrix.” What we are told by our some of our legislators is a one-dimensional narrative: money is tight, we don’t have the funds support “entitlement” programming, that taxing industries stifles job creation, and that they themselves are just so powerless to do anything about it because someone else is running the show.
It’s just not true.
In the case of the GE loophole, how can a politician or a staffer honestly tell us that the money is not there to fund necessary programs or basic infrastructure as they simultaneously let billions of dollars walk away into offshore tax havens in the Grand Caymans? All the while, the rest of us are expected to work at a global corporation like Wal-Mart that advocates for depressed wages and encourages their associates to go on public assistance because they do not want to pay them a living wage. They have more pockets to line with those stinkin’ loopholes than I have in my entire wardrobe.
We need to put capital back in the hand of citizens, where it gets spent within our economy and will, in turn, grow our economy. There’s no legitimate reason why we should not enact such a tax like H.R. 1579 in the U.S. It has the potential to generate and infuse hundreds of BILLIONS of dollars into our economy that will give us the much needed funds to improve Kentucky and America as a whole. It also makes our financial systems more stable and less susceptible to the erratic trading that landed us into the economic meltdown that affected all of us in 2008. I’m tired of hearing the same lies year in and year out.
The fact is, our representatives are failing to do their jobs when they don’t support good policy that uplifts us all.
The Long View: Chess, Not Checkers
My overall take away from this trip is the reassurance that there are SO many people, across the country and from all kinds of backgrounds, that care SO much and DO make substantial and effectual change in a wide variety of areas. And sometimes that’s enough; to just know that you and/or your organization are not alone in the fight for justice.
Sometimes that’s enough in the face of bad laws being enacted or preserved, or seeing first hand how corporate corruption is real and stealing billions from our country. Sometimes that's enough when meeting with legislative staff or a legislator themselves, who is supposed to represent you and your state yet they make it all too clear that they have a fundamental disregard for doing their part, and their job, to ensure a better quality of life for all whom reside here.
Knowing you aren’t alone in all of that? Sometimes that’s enough. We all know how important what we are fighting for truly is. So when these issues are not reflected in the priorities of those who are power, it kills a tiny part of you. But seeing all those Rising Voices conference folks there, and all the women from NDWA, 1,000+ strong. I was blown away from the energy of it all.
I’m confident that we’ll win in the end. At the opening plenary for the NPA portion of the summit, we learned of NPA Director George Goehl’s vision of “moving from checkers to chess.” We in the movement must organize and plan for the long haul. In the meantime, we’ll hold our lawmakers accountable, we’ll educate and empower voters to build a healthier democracy, and we’ll encourage better, more competent, more progressive, and more compassionate leaders.
That weekend in April, Greg, Beth, and I represented an 8,000+ group of Kentuckians and met others who were doing the same for their state or national organizations. We connected and we saw we were not alone. Sometimes that’s enough. Sometimes IT HAS to be enough.
Join KFTC, National People's Action, or National Domestic Workers Alliance. We will not give in. The only way to go is for justice so we’ll go again, no matter how many tries it takes. Forever we go again until we win.