Should the Rich Pay More Taxes?

Unit: ELA – Opinion
Grade Level: 7^th Grade Economics

Lesson: Distribution of Wealth in the USA: Should the Rich Pay More Taxes?
Time Frame: 90 to 135 min.

Objective: SWBAT 

• understand the application of income taxes on citizens
• identify how taxation really occurs
• write opinion pieces about taxing wealthy people higher taxes

Materials: 

• Smart Board, Handouts, Clips, Loose leaf/Notebooks
• http://www.ourdocuments.gov/document_data/document_images/doc_057b_big.jpg
• http://www.democracynow.org/2013/11/8/we_are_living_in_the_world
• www.scholastic.com
• http://www.youtube.com/watch?v=tubgMAh5s74
• http://www.democracynow.org/2011/9/19/occupy_wall_street_thousands_march_in
• http://www.democracynow.org/2011/9/20/rev_jesse_jackson_on_taxing_the
• http://www.cbsnews.com/8301-3445_162-20124334/a-taxing-debate-who-should-pay-more/?pageNum=2

Common Core Standards ELA:

• Literacy RI.7-8.7 Integrate and evaluate multiple sources of information presented in different media or formats as well as in words in order to address a question or solve a problem.
• Literacy RI 7-8.1 Cite strong and thorough textual evidence to support analysis of what the text says explicitly as well as inferences drawn from the text.

Overview:

The government provides public goods and services for the community as a whole. To pay its bills, the government needs revenue, or a source of income. The money that the federal government uses to pay its bills comes mostly from taxes. Taxes shift resources from private individuals and businesses to the government.

Students will read the articles from Junior Scholastic – David Logan and New York Times- Holly Ojalvo about “Should Rich People have to Pay More Taxes?  They should debate in groups of 4 their position. Once defined, they will make their claims and support with evidences from the texts.

Procedure:

1. Do Now: Quickwrite -- When you buy a meal at Mc Donald’s, does the price on the menu match the price you pay?  Why do we pay taxes?

2. Reading: Students will separate into groups of 4 and read the David Logan and Holly Ojalvo articles. 

3. Viewing and Response: Students will watch the clips and read excerpts from the transcripts and answer the following questions as a group:

• Will the Millennial Generation achieve the American Dream? Do you think that there is a central message of protestors at OWS? If so, what is it? Is it effective to Occupy Wall Street?
• What are the arguments both for and against the positions of Warren Buffett, Barack Obama and Bill De Blasio? Why has Congress not supported their position? Do you think it will?
• Would you like to see the very wealthy contribute more to the economy in form of taxes?

4. Divide class into opposing viewpoints. Stage a debate between the two viewpoints, moderated by the teacher.

Extension: Write an essay (7 paragraphs) on this topic. “If you were super rich, would you be willing to be subject to a relatively higher tax rate?”

Readings:
Reading 1: Should Rich People Have to Pay More Taxes?

By Holly Epstein Ojalvo

Warren E. Buffett, an investor who is one of the wealthiest people in the world, wrote an Op-Ed article in The Times this week arguing that the “super-rich” should be required to contribute more to the United States economy in the form of taxes, and says that most wealthy people wouldn’t mind doing so. Do you agree or disagree?

In his Op-Ed, “Stop Coddling the Super-Rich,” Mr. Buffett argues that he and his “mega-rich friends” have not been called to sacrifice a greater percentage of their wealth to help the economy:

I know well many of the mega-rich and, by and large, they are very decent people. They love America and appreciate the opportunity this country has given them. Many have joined the Giving Pledge, promising to give most of their wealth to philanthropy. Most wouldn’t mind being told to pay more in taxes as well, particularly when so many of their fellow citizens are truly suffering.

Twelve members of Congress will soon take on the crucial job of rearranging our country’s finances. They’ve been instructed to devise a plan that reduces the 10-year deficit by at least $1.5 trillion. It’s vital, however, that they achieve far more than that. Americans are rapidly losing faith in the ability of Congress to deal with our country’s fiscal problems. Only action that is immediate, real and very substantial will prevent that doubt from morphing into hopelessness. That feeling can create its own reality.

Job one for the 12 is to pare down some future promises that even a rich America can’t fulfill. Big money must be saved here. The 12 should then turn to the issue of revenues. I would leave rates for 99.7 percent of taxpayers unchanged and continue the current 2-percentage-point reduction in the employee contribution to the payroll tax. This cut helps the poor and the middle class, who need every break they can get.

But for those making more than $1 million — there were 236,883 such households in 2009 — I would raise rates immediately on taxable income in excess of $1 million, including, of course, dividends and capital gains. And for those who make $10 million or more — there were 8,274 in 2009 — I would suggest an additional increase in rate.

My friends and I have been coddled long enough by a billionaire-friendly Congress. It’s time for our government to get serious about shared sacrifice.

Reading 2: Should the rich pay more taxes?
A News Debate by David Logan and Steve Wamhoff

Background: Under President George W. Bush (2001-2009), Congress cut taxes for all Americans. Last December, President Barack Obama extended those tax cuts. Now he and Democrats want to raise taxes on the wealthiest Americans to help lower the soaring federal deficit. Republicans say that any increase in taxes would further weaken the economy.

Should the rich pay more taxes?

YES: Rich Americans are currently taxed at a rate of 35 percent. Thirty years ago, it was 70 percent. That means there's less money to help seniors pay for health care and ensure that all young people get a quality education. When government spends less, we either get less or have to pay more.

For example, in the past, public school students didn't have to pay for things like books and extracurricular activities. Now it's common for families to spend hundreds of dollars on supplies, club memberships, and sports uniforms. Because extracurricular activities help you get into college, such costs put kids from lower-income families at a disadvantage.

Every dollar cut from tax revenues means a dollar cut from fire stations, state parks, highways, and national security -- infrastructure that everyone needs, including the rich.

More and more affluent Americans -- including financier Warren Buffett.the third-richest man in the world -- say that the rich should pay their fair share of taxes. For the country's sake, they should.

--STEVE WAMHOFF, LEGISLATIVE DIRECTOR, CITIZENS FOR TAX JUSTICE

NO:  As the economy continues to sputter, it's tempting to think that raising taxes on the rich will help solve the country's problems. But America's highest earners already pay much more than everyone else. The top 1 percent of families earn 20 percent of all income, but pay 40 percent of income taxes in the U.S. In fact, the tax burden on the rich has actually grown, while middle-income Americans have been paying less each year.

The truth is, it's the wealthy who start the companies that create most of the jobs. Raising their taxes will discourage them from investing more in their businesses, making innovations, and hiring new employees.

The biggest problem with our economy is out-of-control government spending. Recent studies of European economies have shown that cutting spending, along with taxes, is the most effective way to reduce a nation's deficit and boost growth.

Wealthy Americans are already paying their fair share and then some. Instead of taxing them at higher rates, we should make taxes lower for everyone.

--DAVID S. LOGAN