Lagarde, predicting that the debt crisis has yet to run its course, adds: “Do you know what? As far as Athens is concerned, I also think about all those people who are trying to escape tax all the time. All these people in Greece who are trying to escape tax.” She says she thinks “equally” about Greeks deprived of public services and Greek citizens not paying their tax.

“I think they should also help themselves collectively.” Asked how, she replies: “By all paying their tax.”

Asked if she is essentially saying to the Greeks and others in Europe that they have had a nice time and it is now payback time, she responds: “That’s right.”

But as it turns out, Lagarde was throwing stones from inside a glass house, since she doesn’t pay any taxes of her own due to working for the IMF, which is part of the United Nations system. Most UN employees pay no taxes on their income.

Of course, when it comes to Greece and revenue, Lagarde did have a bit of a point. Greece’s revenue is on the low end for a European nation, due in part to its large underground economy:

In 2009, Greece collected just 36.9 percent of GDP in total government revenues. That was far below the overall EU total of 43.9 percent. Greece’s anemic tax collections ranked them seventh from the bottom among EU countries…This has been a longstanding problem in Greece. From 2001 to 2007, Greece consistently collected far less in revenue than a typical EU country. [...]

The current crisis has cast a light on Greece’s shadow economy and massive illicit financial flows. There are varying estimates of the size and impact of the country’s underground economy. Some suggest that a quarter of Greece’s GDP comes from its underground economy and estimates are that Greece lost an estimated $160 billion in unrecorded transfers through its balance of payments over the last decade ending 2009.

Perhaps next time, though, Lagarde should find a messenger that doesn’t earn a tax-free income that is larger than that made by the President of the United States.

The new package, largely backed by Tea Party-affiliated state legislators, abandoned some of Brownback’s proposals that would have hit the poor the hardest, though some still remain. But it will force lawmakers to make even deeper cuts to education and other programs to make up a growing budget gap, the Wall Street Journal reports:

The tax plan, which was the subject of weeks of intense debate and political maneuvering in the legislature, will reduce the top individual state income-tax rate to 4.9% from 6.45% in 2013. It also will eliminate income taxes on non-wage income for about 191,000 small businesses.

The plan likely would require additional cuts in spending on education and social services to cover a reduction in annual tax revenue projected by the Kansas Legislative Research Department to exceed $800 million by 2014, or 12.8% of projected state revenues.

“It is not good public policy,” state Sen. Steve Morris (R), the president of the state Senate, said of the legislation. Other Republicans agreed, including a group of 50 former Kansas Republican lawmakers who attempted to persuade Brownback to veto the bill. “I think Kansas taxpayers need to be asking where the governor would make these cuts,” said Rochelle Chronister, who formerly served as a state representative and as the president of the state GOP, said earlier this month.

Kansas’ tax code is already regressive, as the poorest 20 percent of Kansans paying more than 9 percent of their income in taxes, while the richest 1 percent pay less than 6 percent of theirs. Now, it is even more regressive, and on top of that, poor and middle class Kansans will have to deal with spending cuts that hit social programs on which they depend.

The Tea Party congressman’s concession came at a small town hall meeting in Pompano Beach. West stipulated that before he would consider increasing taxes, he would have to be satisfied that Congress had first “eliminated a lot of that waste, fraud, and abuse.” Once that threshold was met, West said it’d be time “to talk about raising taxes as a means to make sure we keep our debt and our deficit at a manageable level”:

QUESTIONER: How can we balance the budget without raising taxes?

WEST: [...] There are many things we can do in Washington DC. Last year, as a wet-behind-the-ears freshman, by April I found three wasteful programs in the Department of Defense. It saved the American taxpayer $357 million over 10 years. But, the question is this. If every single member in the House of Representatives, every single member in the Senate, went in on the committee of jurisdiction and oversight and they did the same thing, find $350 million in wasteful programs over the next 10 years, get it and eliminate it, think what happens for our budget. We get ourselves on the road to being able to balance this thing . Now, once we get to a point where we have waxed out the federal government, we have eliminated a lot of that waste, fraud, and abuse, then it certainly comes to the American people to talk about raising taxes as a means to make sure we keep our debt and our deficit at a manageable level.

Watch it:

The fact that West’s announcement is so surprising speaks to just how intransigent congressional Republicans have become when addressing tax and budget issues.

One of the primary reasons for their obstinance is because of a single anti-tax crusader in Washington DC, Grover Norquist. Nearly every Republican in Congress has signed Norquist’s pledge to “oppose and vote against tax increases.” Just seven House GOPers and seven in the Senate have refused.

Still, cracks are beginning to appear. Other House Republicans have shown similar angst about Norquist’s pledge recently, despite being signatories. They include Reps. Steve King (R-IA), Timothy Johnson (R-IL), Jeff Fortenberry (R-NE), Charles Boustany (R-LA), Mike Simpson (R-ID), and Frank Wolf (R-VA).

However, it seems that Gov. John Kasich (R-OH) and the Republican legislature feel that the state has money to burn on tax cuts for the financial industry:

An Ohio Legislative Service Commission analysis said the bill “may decrease GRF (general revenue fund) revenue by an uncertain amount, though the revenue loss may be up to $30 million per year, when compared to the introduced version of the bill.”

The potential of a $23 million to $30 million tax cut for financial institutions drew fire from Democrats at a time when schools and local governments are suffering from significant budget cuts.

Kasich’s original plan was meant to be revenue neutral, but the legislature cut it up until it turned into a gift to the banks worth millions of dollars. As Policy Matters Ohio noted, the justification for cutting banks’ taxes — that they will use the money to increase lending — is fundamentally flawed:

The idea that cutting bank tax rates will fuel more lending and a stronger economy is misplaced. Since many Ohio banks already are “flush with cash,” as a representative of the industry puts it, cutting their taxes is unlikely to lead to new lending. Ohio banks are doing well, as a Feb. 28 press release from the Ohio Bankers League entitled “Bumper Quarter for Ohio Banks” attests, and are in no need of a tax cut.

“We’re basically giving the banks … a $25 million gift every year,” said state Rep. Mike Foley (D). “But we’re also doing that in the context of an economy and state budget in Ohio that has been wracked and harmed and hurt and mangled by the financial industry that we’re giving benefits to today.”

Americans for Tax Reform President Grover Norquist

To American for Tax Reform President Grover Norquist, Schumer and Casey’s effort is akin to Nazism or South African apartheid, as The Hill reports:

“I think Schumer can probably find the legislation to do this. It existed in Germany in the 1930s and Rhodesia in the ’70s and in South Africa as well,” said Norquist. “He probably just plagiarized it and translated it from the original German.”

The Nazis infamously implemented a departure tax on Jews who tried to flee Germany before World War II. Schumer is Jewish.

“There’s already a law in the books George, but this is outrageous,” said Speaker of the House John Boehner (R-OH), referencing Saverin’s tax avoidance. “If it’s necessary, sure I would support [the Ex-Patriot Act].” In the last few months, several House Republicans have broken with Norquist and the Americans for Tax Reform anti-tax pledge, which says that signers will never agree to any tax increase, for any reason.

Former Gov. Christine Todd Whitman (R-NJ)

On CNBC today, former GOP Governor Christine Todd Whitman (NJ) criticized Romney’s tax plan, “you can’t do just tax cuts”:

I believe in cutting taxes. I cut taxes as a governor over and over again. But you can’t do just tax cuts. There are going to be times when you are going to have to close loopholes or raise some taxes. And unfortunately, as a candidate, and this is the problem with our primary system, it forces candidates to the right and to the left, Mitt Romney signed the no-new-taxes pledge.

Watch it:

While Romney has indeed pledged fealty to Grover Norquist and the Americans for Tax Reform anti-tax pledge, more and more Republicans have been breaking from that pledge, acknowledging that revenue needs to be a part of the nation’s budget solution. Rep. Timothy Johnson (R-IL) even blasted the pledge as “disingenuous and irresponsible.”

State treasurer Richard Mourdock (R) rehashed a favorite GOP talking point — that 47 percent of Americans don’t pay income taxes — at the town hall in Columbus City, Indiana, comparing those 47 percent to the Confederate states that seceded from the Union in an attempt to protect and expand slavery. Referencing Lincoln’s speech, Mourdock said that as long as nearly half of Americans don’t pay taxes, “we are a house divided” that is presumably on the point to another fight, this time between the rich and the poor:

MOURDOCK: What he meant by that was that slavery was either going to be totally eliminated from the United States or it was no longer just going to be restricted to the Southern states, it was going to go everywhere. I am here to suggest to you that we are in a house divided. You know this past April, when our federal taxes were paid, 47 percent — 47 percent — of all American households paid no income tax. In fact, half of that 47 percent almost, actually got tax money back from the government that they never paid -– because a few years ago we revised the welfare program to make it part of the tax code. When 47 percent are paying no income taxes — they do pay Social Security — but they are not paying income taxes, and 53 percent are carrying the load, we are a house divided.

Watch it:

Mourdock’s ridiculous allusion to a speech referencing the spread of slavery aside, the facts he presented to town hall attendees aren’t telling the whole story. It’s true that half of Americans don’t pay federal income taxes, but they do pay state income taxes, payroll taxes (which Mourdock referenced), and a host of other taxes. Many of those 47 percent don’t pay income taxes because they don’t have income on which to pay taxes — they are students or seniors without taxable income, or they don’t make enough money to qualify for the bottom tax bracket.

Republicans have opposed tax increases of various kinds to help pay down the deficit, largely because so many are beholden to a radical no-taxes pledge authored by Americans for Tax Reform President Grover Norquist. Mourdock, who has signed the pledge, seems no different than many Republicans in Congress — he’s willing to ignore the pledge, as long as the only tax increases that pass are on the poorest Americans.

Facing criticism from policy analysts and lawmakers, Brownback’s plan hung up in the state legislature, where lawmakers have been working to hammer out a compromise plan. Now, however, a group of 50 former Republican lawmakers is calling on Brownback to abandon the plan because it would blow a massive hole in the state budget, jeopardizing schools, roads, and other important programs, the Lawrence Journal-World reports:

Traditional Republicans for Common Sense said the tax bill, if enacted, would put the state in a budget hole that would result in cuts to essential services, such as schools, roads, and nursing home care. The group said it would also lead to increases in local property taxes.

“I think Kansas taxpayers need to be asking where the governor would make these cuts,” said Rochelle Chronister, former assistant majority leader in the House, and former chair of the Kansas Republican Party.

“More importantly, we need to be asking what cuts of this magnitude might look like for working families, retirees and Kansas children,” Chronister, of Neodesha, said.

Original analysis of Brownback’s plan found that it would cost the state $900 million by 2018. A new analysis, released recently, said it would cost only $160 million by 2018, though that plan is based on growth projections in state sales tax revenues that are largely unrealistic.

Brownback has not said how he would make up the lost revenue, instead adhering to the false Republican orthodoxy that the tax cuts wouldn’t affect the budget because they would create jobs and boost economic growth.

At the time, presumptive Republican presidential nominee Mitt Romney slammed Biden’s proposal. “Instead of promoting pro-growth tax policies that provide businesses with the economic freedom to grow and prosper, he is backing a ‘global tax’ that would harm American competitiveness,” Romney said. At a campaign stop in Portsmouth, New Hampshire yesterday, however, Romney feigned ignorance of the proposal:

ROMNEY: And the vice president says he wants to do a global tax on multinationals. Not sure what that is, but it doesn’t sound very good.

Watch it:

Under the global tax plan, the 26 corporations that haven’t paid taxes in the last four years would actually have to pay taxes. So would Apple, which used offshore tax havens to dodge $2.4 billion in taxes last year. Romney’s plan, by contrast, would cut corporate taxes and the tax on profits corporations bring from overseas. His justification: America’s high corporate tax rate hurts competitiveness, and the lower repatriation rate will boost job growth. In reality, American corporations pay one of the world’s lowest tax rates, and the last repatriation holiday was a complete failure.

It’s no secret why Romney doesn’t want to talk about the global minimum tax. While his plan would provide a massive giveaway to American corporations, the plan Biden floated would actually raise corporate tax revenues — something a vast majority of Americans support.

Fiorina — who unsuccessfully challenged Sen. Barbara Boxer’s (D-CA) senate seat in 2010 — insisted that “we now have the single highest business tax rate in the world” and claimed that companies are moving jobs overseas to avoid this burden. Krugman snapped back against her assertion, noting, “nothing you said about business taxes is actually true”:

FIORINA: We now have the single highest business tax rate in the world. Guess what, with the highest tax rate in the world, we see the same thing around the world as we see in states. States with lower tax rates have more jobs, more people. People leave states with higher tax rates. The data is crystal clear.

KRUGMAN: Nothing you said about business taxes is actually true. …. If you look at the actual tax collections in the United States on business, they’re lower than other advanced countries. And if you look at the alleged finding that high business taxes cause job loses in states, it goes away. Kick the tires even slightly and the whole thing falls apart. It’s just not true.

Watch it:

Indeed, a recent study from the Center for Tax Justice (CTJ) found that “the U.S. is already one of the least taxed countries for corporations in the developed world.” As a share of GDP, the U.S. had the second lowest tax rate, behind only Iceland. In 2009, U.S. corporate taxes had fallen to only 1.3 percent of GDP, from 4 percent in 1965.

The Political Economy Research Institute at the University of Massachusetts concluded that “the worst fears of the policy debates over raising additional revenue from high-income households to sustain spending on public services are unlikely to materialize.” Millionaires will attempt to avoid higher taxes by changing the composition of their incomes, but don’t, in fact, move to avoid the higher fees.

Gov. Terry Branstad’s $52 state income tax bill in 2011 is proof that fixes are needed in the tax system, Sen. Robert Hogg, D-Cedar Rapids said today.

“Some people talk about nationally we need a Buffet rule, maybe in Iowa we need a Branstad rule,” said Hogg, who additionally noted that a person making between $30,000 to $40,000 a year can expect to pay somewhere around $1,000 or more in state income tax.

Branstad was able to pay such a low amount because Iowa is one of just six states in the country that allows residents to write off their federal income tax payments from the previous year on their current year’s tax return. So Branstad was able to apply his 2010 federal income tax payments — which were paid on the salary he received from his prior job as the president of Des Moines University — to this year’s state income tax bill.

Iowa loses $642 million annually due to this provision, nearly one quarter of its total income tax revenue. More than half of the benefit of the deduction goes to the richest 5 percent of Iowans, while 76 percent of the benefits go to the richest 20 percent. “States should take a hard look at eliminating, or at least capping, their deduction because of the impact this lopsided tax policy has on state budgets and tax fairness,” the Institute for Taxation and Economic Policy wrote. Branstad’s administration called his low tax bill an anomaly. (HT: CTJ)

Closing the “John Edwards loophole,” named after the former senator who used it while practicing law, would raise enough revenue to offset the $6 billion cost of extending the current interest rate. But Senate Majority Leader Harry Reid (D-NV) sounded pessimistic about garnering Republican support yesterday, saying the GOP would take its cues from Norquist, who opposes closing loopholes to raise new revenue, before deciding whether to support it, the Las Vegas Sun reports:

“I think the proper question is, is it something Grover Norquist would accept,” Reid said, invoking the author of the anti-tax pledge to chide his opponents’ unwillingness to raise taxes. “He seems to be the marker for Senate Republicans. We’ll see.”

If Republican reaction today is any indication, Norquist hasn’t given his blessing to the Democratic plan. Minority Leader Mitch McConnell (R-KY), who says he supports the extension, blasted the plan on the Senate floor today, saying it would “raid[] Social Security and Medicare” while “making it even harder for small businesses to hire”:

MCCONNELL: Democrats want to pay for it by raiding Social Security and Medicare and by making it even harder for small businesses to hire. We happen to think that at a time when millions of Americans and countless college students can’t even find a decent job it makes no sense whatsoever to punish the very businesses we’re counting on to hire them. It’s counterproductive and clearly the wrong direction to take.

McConnell’s argument that the plan would undermine Medicare and Social Security makes no sense — though the taxes raised from closing the loophole would normally be directed toward those programs, they are not going there currently because they are not being collected at all.

Closing the loophole, as Citizens for Tax Justice explained in 2010, would actually benefit small businesses and individuals, leveling the playing field for those that don’t game the tax code to lower their rate. “When some small business owners avoid taxes, honest taxpayers make up the gap by paying higher taxes,” CTJ wrote. “Lawmakers who are concerned about the tax burden of small businesses need to do everything possible to close loopholes in the tax code so that all Americans pay their fair share.”

House Republicans recently proposed cuts to nutrition assistance that will kick 280,000 low-income children off automatic enrollment in the Free School Lunch and Breakfast Program. Those same kids and 1.5 million other people will also lose their Supplemental Nutrition Assistance Program (formerly food stamp benefits) that help them afford food at home.

Ten years’ worth of these nutrition cuts could be prevented for the price of one year of tax cuts on 3,340 multimillion dollar estates that House Republicans are protecting in their budget.

On April 18 the House Agriculture Committee passed a bill cutting over $33 billion from SNAP over the next decade. About one-third of these cuts ($11.5 billion) comes from putting restrictions on “categorical eligibility,” a provision that enables states to better coordinate between programs and improves access to assistance for low-income families.

By restricting this provision, the bill would kick an average of 1.8 million low-income people a year off of food aid and end automatic enrollment in free school meals for 280,000 children in struggling families.

The Republican budget sells this bill as an effort to “reduce lower‐priority spending” to avert military cuts that will otherwise take place in January 2013 due to the debt deal agreed to last summer. But when it comes to reducing the deficit, it’s clear the House would rather ask low-income kids and families struggling against hunger to foot the bill than asking multimillion-dollar estates to pay their fair share.

Case in point: As part of the 2010 tax-cut compromise, House Republicans insisted on including a tax cut on multimillion dollar estates, adding an estimated $11.5 billion to the deficit this year alone. That’s the same amount they’re now claiming is necessary to cut from low-income families through these restrictions.

By making it more difficult for low-income schoolchildren to access school breakfast and lunch, this bill will likely increase child hunger, which is associated with worse educational outcomes and higher long-term health costs. Both of these trends affect our economy and our deficits over the long run.

We should reconsider reduced spending on “lower priority” items — a.k.a breakfast, lunch, and dinner for low-income children — and instead adopt a deficit-reduction approach that asks everyone to pay their fair share—including multimillion-dollar estates.

Clergy member holds up Wells Fargo share outside the bank's shareholder meeting (via PICO National Network)

Hundreds of protesters, including religious leaders, union workers, and other 99 Percent Movement activists, gathered outside Wells Fargo’s shareholder meeting in San Francisco today, protesting the bank’s fraudulent foreclosure practices. Wells Fargo, the nation’s largest mortgage servicer, has a well-documented history of using fraudulent practices like robo-signing, and even more came to light last week when an insider account detailed the bank’s foreclosure unit as operating “exactly like an assembly line.”

Ahead of the protests, a Wells Fargo spokesperson told San Francisco’s ABC news affiliate that the bank has paid taxes and is a “responsible corporate citizen” that “makes an effort to keep people in their homes“:

Wells Fargo spokesman Ruben Pulido released a statement early this morning saying the bank is a “responsible corporate citizen” and paid $6 billion in taxes for 2011.

“Wells Fargo makes efforts to keep people in their homes,” Pulido said. “Over the past year, less than 2 percent of owner-occupied loans in our servicing portfolio have resulted in foreclosures.”

Wells Fargo was among 30 corporations that paid nothing in federal income taxes from 2008-2010 — its tax rate over that time period, in fact, was -1.4 percent. Adding 2011 to that time period just barely inches the bank’s rate into the positive.

The idea that Wells Fargo makes every attempt to keep homeowners in their homes, meanwhile, is laughable. The bank has been among the worst perpetrators of practices like robo-signing and dual tracking — the process of simultaneously offering homeowners loan modifications while also pushing them toward foreclosure. It has wrongly foreclosed on homes it didn’t own, and its victims may include thousands of members of the American military.

The initial protests drew roughly 500 people, according to early reports from a local NBC affiliate. Early marches through the city shut down numerous San Francisco streets and remained peaceful, according to NBC, though there have been arrests reported on Twitter. Later, there were more than a thousand protesters, according to other estimates, and clergy members and protesters who had purchased shares in Wells Fargo attempted to enter the meeting. Here are some pictures of the protest:

This isn’t the first time religious leaders or Occupiers have targeted Wells at its San Francisco headquarters. Local churches moved $10 million from the bank in February to protest its foreclosure practices, and they held Ash Wednesday services outside Wells Fargo asking it to repent for its wrongful practices.

In the postwar U.S., higher top tax rates tend to go with higher economic growth — not lower. Indeed, according to the U.S. Department of Commerce’s Bureau of Economic Analysis, GDP annual growth per capita (to adjust for population growth) averaged 1.68% between 1980 and 2010 when top tax rates were relatively low, while growth averaged 2.23% between 1950 and 1980 when top tax rates were at or above 70%.

Neither does international evidence support a case for lower growth from higher top taxes. There is no clear correlation between economic growth since the 1970s and top tax-rate cuts across Organization for Economic Cooperation and Development countries.

Saez and Diamond also note that growth can be boosted if the revenue raised from higher taxes gets spend on infrastructure or other public investments. “The neglect of public investment over the last few decades suggests that the returns could be quite high,” they wrote.

As this chart shows, job growth has been weakest when the top tax rate was at its lowest:

In fact, job growth has been stronger when taxes are higher overall:

Of course, none of this should be construed as proving that higher taxes cause better job growth. But the Republican claim that higher taxes will blunt job growth is most certainly not true, as the data shows.