Melvin B. Miller
Editor & Publisher

An unfair burden

Public attention invariably focuses on the black poor. Almost unnoticed, the black middle class has grown substantially. Arbitron Inc. and Scarborough Research, media research organizations, produced a study last summer that indicated the substantial size of this change in the past five years.

The report found that the number of black college graduates had grown 14 percent since 2000. As one might expect, black household income has also increased. In the five years since 2000, black household incomes of $75,000 or more have grown 26 percent.

With higher incomes, more blacks have been interested in buying more expensive cars and costlier homes. According to the report, the number of blacks interested in buying cars which cost $35,000 or more rose by 20 percent in the past five years. Also, the number of blacks planning to buy a home was 24 percent higher than the national average. In the past five years, there has been a 350 percent increase in the number of black households owning homes valued at $500,000 or more.

Clearly, the black middle class has been growing despite economic reports about the stagnation in lower and mid-level incomes. However, the rich are still getting richer. In 2005, the top 1 percent of Americans, those who earned $1.1 million or more per year, received 21.8 percent of the nation’s total income. This is the largest share to the wealthiest Americans since 1929.

This income disparity is the reason that many Americans oppose President Bush’s tax breaks for the very rich. One of the ways to narrow the income gap is a progressive tax code that requires the very rich to pay a higher percentage of their income to the government.

That is not the case now, as the rich are able to hire the services of skilled tax lawyers to enable them to pay taxes at a rate even lower than the middle class.

As blacks emerge into the middle class, they are confronted with a significant dilemma. Are they going to join efforts to secure their economic position and help to create opportunities for the development of black wealth? Or are they going to continue to focus exclusively on civil rights issues?

Make no mistake about it: the two paths are not identical. It would require a distorted analysis indeed to conclude that tax reform is a civil rights matter. In fact, a campaign to make taxation more progressive cannot succeed if the race issue is interjected. Yet the reform of the tax code would make more funds available for public programs that benefit the financially impaired.

The failure of the emerging black middle class to join forces with others intent on reforming the tax code could have unfortunate consequences. The Alternative Minimum Tax (AMT), which was supposed to ensnare rich families, now has an unintended impact. Starting with taxes for 2007, middle class and upper middle class taxpayers with family incomes of $100,000 or more will see their tax burdens increase. Projections indicate that more than 23 percent of Massachusetts taxpayers will feel the effects of the AMT in 2007.

An income of $100,000 for a two-income family in Massachusetts is by no means excessively affluent. But without modification of the tax laws, this group will be subject to greater taxes in 2007 because of the AMT. This is not a racial bigotry issue. It affects everyone without regard to race.

Headline2

“When you were out of a job,
you would have been glad to have a paycheck so you could pay some taxes.”