Since the mid-1970s, there has been a dramatic shift in America's socioeconomic system, one that has gone virtually unnoticed by the general public. Tax policies and their enforcement have become a disaster, and thanks to discreet lobbying by a segment of the top 1 percent, Washington is reluctant or unable to fix them. The corporate income tax, the estate tax, and the gift tax have been largely ignored by the media. But the cumulative results are remarkable: today someone who earns a yearly salary of $60,000 pays a larger percentage of his income in taxes than the four hundred richest Americans.
Pulitzer Prize-winning investigative reporter David Cay Johnston exposes exactly how the middle class is being squeezed to create a widening wealth gap that threatens the stability of the country. By relating the compelling tales of real people across all areas of society, he reveals the truth behind:
•
"Middle class" tax cuts and exactly whom they benefit.
•
How workers are being cheated out of their retirement plans while disgraced CEOs walk away with millions.
•
How some corporations avoid paying any federal income tax.
•
How a law meant to prevent cheating by the top 2 percent of Americans no longer affects most of them, but has morphed into a stealth tax on single mothers making just $28,000.
•
Why the working poor are seven times more likely to be audited by the IRS than everyone else.
•
How the IRS became so weak that even when it was handed complete banking records detailing massive cheating by 1,600 people, it prosecuted only 4 percent of them.
Johnston has been breaking pieces of this story on the front page of The New York Times for seven years. With Perfectly Legal , he puts the whole shocking narrative together in a way that will stir up media attention and make readers angry about the state of our country.
Amazon.com Review
Most Americans would agree that they are duty bound as beneficiaries of our democracy to pay taxes, and the majority of us do pay—-exorbitantly. But what about those who do not pay their fair share? David Cay Johnston, a Pulitzer Prize-winning reporter for the New York Times , here reveals how fairness and equity have eroded from the American tax system. Johnston describes in shocking detail the loopholes our government provides the "super rich"--from private individuals to profitable corporations—-to hide their wealth, to defer or evade tax payments, and to pass the bill to law-abiding middle-class Americans. The loss in revenue "imposes a severe cost on honest taxpayers" through reduced services, increased federal debt, and a weight on the middle class that threatens to impede its ability to achieve upward social mobility. Admitting the extreme complexity of our economy and by extension our tax code, Johnston points out that the very wealthy do, of course, pay taxes. However, because of shelters that allow them to understate most of their income, they pay little more on average than most Americans on the dollar. This is regressive, and unquestionably favors the superrich. Johnston includes examples of outrageous corporate malfeasance (such as companies that establish off-shore tax addresses) and exposes the tax benefits of the particularly loathsome practice made famous by Jack Welch, in which thousands of wage earners are laid off while a handful of executives are granted hundreds of millions of dollars through deferred compensation, company stock options, and lucrative retirement packages, all at stock holders' xpense. In addition to these offenses, he describes the tax evasion methods of those who simply defy the law and are emboldened by a beleaguered IRS that is too underfunded to serve as an effective deterrent to tax cheats. Johnston calls for a complete overhaul of the system. But because those who most benefit from these laws comprise the "donor class" that supports the government power structure, our prospects for reform remain very bleak. -- Silvana Tropea --This text refers to an out of print or unavailable edition of this title.
Eye-opening. -- John Landry,Harvard Business Review
Mr. Johnston exposes some fundamental problems with the tax code that Campaign 2004 seems to be overlooking. -- Amity Shlaes,Financial Times
Reading Perfectly Legal is the first step to bringing American government back to its citizens. -- John C. Bogle, founder ofThe Vanguard Group
Superb. -- Steve Weinberg,Cleveland Plain Dealer
This book is vital, an infuriating call to action. -- Jim Hightower, author ofThieves in High Places
Truly shocking. -- James K. Galbraith,The New York Times Book Review
Want to know how business execs get nearly free personal trips on their corporate jets? Johnston is your man. -- Business Week --This text refers to an out of print or unavailable edition of this title.
About the Author
David Cay Johnston won a Pulitzer Prize and shared in another for his investigative reporting in The New York Times , for which he has written since 1995. Prior to that he wrote for the Philadelphia Inquirer , the Los Angeles Times , the Detroit Free Press , and the San Jose Mercury News. Johnston is a frequent guest on NPR's Fresh Air. --This text refers to an out of print or unavailable edition of this title.
Description:
Now updated with a new prologue!
Since the mid-1970s, there has been a dramatic shift in America's socioeconomic system, one that has gone virtually unnoticed by the general public. Tax policies and their enforcement have become a disaster, and thanks to discreet lobbying by a segment of the top 1 percent, Washington is reluctant or unable to fix them. The corporate income tax, the estate tax, and the gift tax have been largely ignored by the media. But the cumulative results are remarkable: today someone who earns a yearly salary of $60,000 pays a larger percentage of his income in taxes than the four hundred richest Americans.
Pulitzer Prize-winning investigative reporter David Cay Johnston exposes exactly how the middle class is being squeezed to create a widening wealth gap that threatens the stability of the country. By relating the compelling tales of real people across all areas of society, he reveals the truth behind:
•
"Middle class" tax cuts and exactly whom they benefit.
•
How workers are being cheated out of their retirement plans while disgraced CEOs walk away with millions.
•
How some corporations avoid paying any federal income tax.
•
How a law meant to prevent cheating by the top 2 percent of Americans no longer affects most of them, but has morphed into a stealth tax on single mothers making just $28,000.
•
Why the working poor are seven times more likely to be audited by the IRS than everyone else.
•
How the IRS became so weak that even when it was handed complete banking records detailing massive cheating by 1,600 people, it prosecuted only 4 percent of them.
Johnston has been breaking pieces of this story on the front page of The New York Times for seven years. With Perfectly Legal , he puts the whole shocking narrative together in a way that will stir up media attention and make readers angry about the state of our country.
Amazon.com Review
Most Americans would agree that they are duty bound as beneficiaries of our democracy to pay taxes, and the majority of us do pay—-exorbitantly. But what about those who do not pay their fair share? David Cay Johnston, a Pulitzer Prize-winning reporter for the New York Times , here reveals how fairness and equity have eroded from the American tax system. Johnston describes in shocking detail the loopholes our government provides the "super rich"--from private individuals to profitable corporations—-to hide their wealth, to defer or evade tax payments, and to pass the bill to law-abiding middle-class Americans. The loss in revenue "imposes a severe cost on honest taxpayers" through reduced services, increased federal debt, and a weight on the middle class that threatens to impede its ability to achieve upward social mobility. Admitting the extreme complexity of our economy and by extension our tax code, Johnston points out that the very wealthy do, of course, pay taxes. However, because of shelters that allow them to understate most of their income, they pay little more on average than most Americans on the dollar. This is regressive, and unquestionably favors the superrich. Johnston includes examples of outrageous corporate malfeasance (such as companies that establish off-shore tax addresses) and exposes the tax benefits of the particularly loathsome practice made famous by Jack Welch, in which thousands of wage earners are laid off while a handful of executives are granted hundreds of millions of dollars through deferred compensation, company stock options, and lucrative retirement packages, all at stock holders' xpense. In addition to these offenses, he describes the tax evasion methods of those who simply defy the law and are emboldened by a beleaguered IRS that is too underfunded to serve as an effective deterrent to tax cheats. Johnston calls for a complete overhaul of the system. But because those who most benefit from these laws comprise the "donor class" that supports the government power structure, our prospects for reform remain very bleak. -- Silvana Tropea --This text refers to an out of print or unavailable edition of this title.
From Publishers Weekly
Since he began writing about taxes for the New York Times in 1995, Johnston's investigative reporting has earned two Pulitzers. The journalistic legwork informs every page of this expos‚ of the ways in which, he says, America's taxation system is stacked in favor of the wealthy. Johnston evades the imposing abstractness of the tax code by keeping the story focused on individuals, from working-class parents facing audits to Internal Revenue Service officials desperate for the resources to revamp their procedures. Chapters addressing the inability of the IRS to go after the worst tax cheats, thanks in part to opposition from grandstanding members of Congress, are particularly effective in putting a spotlight on the problem, but there's plenty of space given to revealing how canny tax attorneys come up with legal (and barely legal) ways to get around the system. And for those who can afford it, he reports, there's always a new dodge available once the law has caught up to the latest tricks. At some points, dealing with numbers becomes unavoidable, but even here Johnston displays a knack for breaking the story down into easily grasped components. Though the tax cuts engineered by Presidents Reagan and George W. Bush receive most of the criticism, Democrats come in for their fair share of opprobrium. Genuine reform, he suggests, will require serious and sustained attention from the public, not just reflexive griping. His book is a thoughtful overview for any citizens willing to educate themselves on the issue.
Copyright © Reed Business Information, a division of Reed Elsevier Inc. All rights reserved. --This text refers to an out of print or unavailable edition of this title.
Review
Eye-opening. -- John Landry, Harvard Business Review
Mr. Johnston exposes some fundamental problems with the tax code that Campaign 2004 seems to be overlooking. -- Amity Shlaes, Financial Times
Reading Perfectly Legal is the first step to bringing American government back to its citizens. -- John C. Bogle, founder of The Vanguard Group
Superb. -- Steve Weinberg, Cleveland Plain Dealer
This book is vital, an infuriating call to action. -- Jim Hightower, author of Thieves in High Places
Truly shocking. -- James K. Galbraith, The New York Times Book Review
Want to know how business execs get nearly free personal trips on their corporate jets? Johnston is your man. -- Business Week --This text refers to an out of print or unavailable edition of this title.
About the Author
David Cay Johnston won a Pulitzer Prize and shared in another for his investigative reporting in The New York Times , for which he has written since 1995. Prior to that he wrote for the Philadelphia Inquirer , the Los Angeles Times , the Detroit Free Press , and the San Jose Mercury News. Johnston is a frequent guest on NPR's Fresh Air. --This text refers to an out of print or unavailable edition of this title.