Written by Thomas Magstadt   

[Note: A version of this article appeared in Nation of Change on August 17, 2012.]

In these perilous times for the nation, Mitt Romney has a chance to beat Obama in November and, more importantly, restore public trust in government. My prediction is that he won’t do either because he believes he can do one (win the presidency) without the other (restoring public trust).

Oddly enough, while poll after poll shows that most Americans no longer trust our basic institutions, they continue to believe the people who run them got where they are on basis of superior merit and talent. This belief flies in the face of mounting evidence of corruption and incompetence at the top.

Despite a steady stream of news about scandals in business (Enron), banking (Countrywide, Lehman Brothers), journalism (Iraq War, WMD, and Judith Miller), sports (Mark McGwire, Barry Bonds, Roger Clemens, and doping), and, of course, politics (Watergate, Iran-Contra, the Keating Five, NSA warrantless surveillance), the public is still being gulled into believing what corporate media shills say about everything from global warming to health care.

Few public policy issues are more confusing and convoluted that our bizarre federal income tax code. The system, like the political and business elites who created and perpetuate it, is designed to deceive most of the people most of the time.

Here are seven facts about wealth, power, and tax welfare that provide a glimpse into the origins and scale of the problem:

1) Since the mid-1980s the median net worth of members of the House of Representatives rose 260 percent; during this same period the median net worth of households (the middle class) remained basically unchanged

2) In the early 1950s, those with high income tax returns paid over 4 times more percentage-wise than the bottom half of income earners; today, based on estimated gross income the lowest fifty percent of tax returns on average pay nearly two-thirds more as a percent of total income than the top 1 percent.

3) The top federal tax rate of 35% is a farce: like Mitt Romney, who admits to paying “at least 13%” each year, most wealthy individuals nowhere near that level.

4) Half the nation’s wealth is excluded from the tax rolls.

5) The net worth of the 400 Americans at the top of the wealth pyramid is now greater than that of 150 million on the bottom.

6) The Bush tax cuts (extended by Obama) transferred an estimated $81.5 billion from the 99 percent of taxpayers to the wealthiest 1 percent.

7) According to the OECD, the US has the highest level of inequality among the world’s advanced economies (rivaled only by Mexico and Chile).

Ironically, the rest of the world sees the hypocrisy at the core of our public life even as we continue to tolerate (and thus enable) it. Some months back, the British Guardian ran an article on the debt-ceiling debacle in the US Congress that highlighted the unfair US federal income tax. The result of “such regressive policies” it noted (correctly) “is a level of inequality unknown in other developed nations.”

In 2000-2001, the last year of President Bill Clinton’s two-term presidency, the federal government ran a small surplus (not counting money “borrowed” from Social Security); between 2001 and 2007, the costly war on terror and the notorious across-the-board tax cuts gave rise to huge annual budget deficits totaling some $3.686 trillion in just six years (2001-2007). The “tax and spend” chief executive with the compliant Congress during those years was George W. Bush. Another recent president who ran up the biggest deficits in the nation’s history was Ronald Reagan.

No republic has ever prospered or endured without a stable currency, sound public finances, a vibrant labor force, fair taxes, and a thriving middle class. The US for all its supposed “exceptionalism” is no exception.

Romney could acknowledge that his Republican party has not been honest with the voters and taxpayers about its commitment to fiscal responsibility and a balanced budget. He could promise to restore the party to its lost principles. He could – and it might get him elected – but he won’t.

The trend toward ever-greater inequality in this country has gone past the tipping point. The “winners” are now so few and so powerful that they alone can save the system from the dire consequences of popular distrust and the prospect of a continuing slide into indentured servitude for millions of debt-burdened Americans.

As the new face and voice of the super rich, Mitt Romney could lead the way. He could begin by disclosing his tax returns. If the real number is 13%, that’s way too low for a guy with an annual income of $20 million for the past two decades.

But he could easily turn this negative into a positive. He could point out that he has broken no laws but has benefited from a tax code that unfairly favors the wealthy and taxes “earned income” at a much higher rate than “capital gains”. He could promise if elected to use the full powers of the presidency to push real tax reform through Congress, to fight for fairness and progressive policies across the board, and to balance the federal budget not by cutting Medicare or privatizing Social Security but rather by slashing bloated and wasteful defense outlays.

Of course, many of his super rich backers would cry “foul”. Many would feel betrayed and threaten to...to do what? Cut off the money flow? Back Obama? Hardly. Billionaires like the Koch Brothers and the casino baron Sheldon Adelson have nowhere else to go. In all probability, there are fair-minded members of the über rich class – Warren Buffet comes to mind – who would support a well-designed plan to move toward tax fairness and fiscal sanity.

While he’s at it, Romney could truthfully say Obama had his chance and blew it. And he could pledge, “No more federal bailouts for banks and corporations too big to fail and zero tolerance for financial fraud, insider trading, and all manner of crime in the suites.”

He could say these things, but he won’t. Romney’s choice of Paul Ryan as his running mate is a harbinger. What it foretells is the outcome of this election and the fate of the country.