Wednesday :: Jun 8, 2005

Tax Fairness

by Mary

Brad DeLong remarks that the NY Times is shocked, just shocked about the current taxation rates. Evidently, for those in the top 20th percentile, people making above $100K but less than $400K per year are paying significantly higher tax rates than those making more than $400K per year. Gee, wonder how that happened? So, muckdog, you must be sitting pretty these days to be happy with the percentage of your income you pay in taxes compared to those other ordinary people making $400K or more.

Yet for those of you that are not muckdog (close your ears, muck), DeLong is right. The problem of class warfare isn't real when you are only talking about the top 20%. The real problem is exposed when you look across the entire income spectrum.

Hey! New York Times! Average--not median, average--gross weekly earnings of nonsupervisory workers are $540--that's $27,000 a year. Average--not median, average--gross weekly earnings of nonsupervisory workers in retail trade are $380 a week--that's $19,000 a year. Many of them face the same problems of trying to get their children the education and skills they need to have opportunities, of caring for aging parents, and of preparing for their own retirement as do those making $200K a year who are "not exactly on easy street."

That "the divide between rich and poor is unfortunately an old story" does not mean that the focus of our attention should be on how to redistribute income and wealth from the top 0.1% to the top 20%.

It's clear that the tax system of the US resembles the systems of the most corrupt and anti-democratic regimes in the world. And don't forget this is the reality when you don't look at the specific tax exceptions. When you add in the "exceptions" like Enron, the tax skew is much worse.

Update: NY Times article here, NY Times editorial here

Mary :: 6:35 AM :: Comments (39) :: TrackBack (0) :: Digg It!