Elrae Potts: Unfair tax system places burden on Indian Country

Thursday, November 7, 2013  

As a long-time advocate for children in the Native American communities, I can confidently report that Indian child services are not the place to look for budgetary fat. Yet federal deficit-reduction strategies like the “sequester” are cutting programs like Head Start and foster care support instead of raising revenue from the folks who have it: huge multinational corporations and unimaginably wealthy households. Until we create a fairer tax system, we’ll never dig our way out of debt or get our economy back in gear.

Tribal communities have historically experienced unemployment and other economic dislocations at a much higher rate than American society as a whole. More than one in four Indians lives in poverty, and one-third lacks health insurance. The Great Recession and long aftermath have only made things worse. And it’s ultimately Native kids who suffer most. As a social worker, every day I see the effects on children of hard times and inadequate public support.

The mindless, across-the-board budget cuts known in Washington as the “sequester” have meant $500 million less this year for a wide range of Native American programs, from the Indian Health Services to Indian housing assistance. By this time next year these cuts will cost the U.S. up to 1.6 million jobs, according to the nonpartisan Congressional Budget Office

We can avoid this unnecessary pain, get our fiscal house in order and, most importantly, spark job creation and economic growth, if we require big corporations and the wealthy to pay their fair share of taxes. Adequately funding investments like education and retirement security boosts the middle class, the true engine of our economy.

Corporations have been shrugging off their responsibilities in this area for a long time. Many familiar corporate giants like FedEx, Verizon and General Electric have gone years without paying a dime in federal income tax, according to a recent watchdog report. Many hide their profits in dummy corporations in the Cayman Islands and elsewhere in order to avoid U.S. taxes. Apple, Inc., avoided paying almost any tax at all on $74 billion in profits.

Now there’s a chance to end some of the worst overseas corporate tax abuse. The Stop Tax Haven Abuse Act would remove many of the lures the tax code now holds for U.S. corporations to hide profits and ship jobs overseas. It would raise $220 billion over the next decade. A small fraction of that amount would restore all the sequester cuts to Indian programs, leaving billions to address other American needs, like better roads and bridges, medical research and energy independence. This bill is just the kind of patriotic, commonsense solution that I know Sen. Jon Tester could support.

The kids I’ve worked with in foster care throughout my career don’t ask for much: just a safe home and a loving family. We owe them that much. But our society’s ability to serve kids, the elderly, the disabled and other vulnerable populations is severely hampered because Congress is looking for money to reduce the deficit in all the wrong places. It’s time to require the wealthy and large corporations pay their fair share of taxes.

Elrae Potts (Spirit Lake Dakota), MSW, is an advocate for Native American rights and is the Board Chair of Indian People's Action.