Interesting piece in the New York Times by Patricia Cohen about how easy it would be to raise taxes on the “1%” in order to see tens of billions of additional revenue for the government.
I had to read this twice to make sure it wasn’t a parody.
The top 1 percent on average already pay roughly a third of their incomes to the federal government, according to a Treasury Department analysis that takes into account the entire menu of taxes — including income tax, payroll taxes that fund Medicare and Social Security, estate and gift taxes, excise and custom duties as well as investors’ share of corporate taxes. The tax bite on the top 0.1 percent is a bit higher. Most of those taxpayers insist they are already paying more than enough.
By comparison, the band of taxpayers right below them, in the 95th to 99th percentile, pay on average about $1 out of every $4. Those in the bottom half pay less than $1 out of every $10.
Sidestepping for the moment the messy question of just which taxes would be increased, how much more revenue could be generated by asking the rich to pay a larger share of their income in taxes?
“Sidestepping” which taxes to increase is shorthand for saying, “What follows is meaningless except to liberals who want other people’s money to spend.”
To get the most accurate picture possible, throw in all the scraps of income, from the most obvious (like wages, interest and dividends) to the least (like employer contributions to health plans, overseas earnings and growth in retirement accounts). According to that measure — used by the Tax Policy Center, a joint project of the Urban Institute and the Brookings Institution — the top 1 percent includes about 1.13 million households earning an average income of $2.1 million.
Raising their total tax burden to, say, 40 percent would generate about $157 billion in revenue the first year. Increasing it to 45 percent brings in a whopping $276 billion. Even taking account of state and local taxes, the average household in this group would still take home at least $1 million a year.
How exciting is that? Robbing people of half their income is a good thing! But hey — they still got a million bucks. What are they complaining about?
You want a “social justice” issue? How about the justice of someone working more than 5 months out of the year solely for government? Five months where not a dime is spent on one’s family. Not a dime is put away for your kid’s college or for your retirement.
Who the hell cares if they still have a million dollars? They used to have two million until Clinton and Sanders got their dirty hands on the fruit their labors. To say “they can afford to pay more” misses the point entirely.
This is what liberals and socialists just don’t get. They believe your paycheck — and the paychecks of the 1% — belong to the government and that it is government that determines how much you get to keep. Conservatives, on the other hand, believe that your money is your property and it is the collective will of the American people who determines how much government can take.
That’s what these “income inequality” schemes are all about. It is government that should determine how “rich” is rich and that some people have too much. So you jack up resentment and envy against those who are more successful than others to justify reaching deeper into their pockets because they are “too rich.”
It is subjective madness that bears no relationship to reality. Ask the French how their “soak the rich” plan turned out?
French President Hollande wanted a 75% tax rate on incomes over a million dollars. How did that work out for ya, Francois?
Hollande has apparently been mugged by a cruel Econ 101 reality that higher government spending and soak-the-rich economics may be a winner in faculty lounges across the country but is a depressant in practice.
The budget deficit hasn’t fallen; it has risen. Businesses have moved out of France. Rich people are taking their money elsewhere, too. You can’t tax wealth if it flees, after all.
So now Hollande says that it is time for a 180-degree — well, maybe 90-degree — change in direction. Make France “business friendly” is his latest crusade.
Hollande promises to cut taxes, relieve regulations that it make it hard for businesses to start up and expand, and lower the budget by 50 billion euros. No one will mistake France’s president for Ronald Reagan or Milton Friedman, but this is a dramatic repudiation of the socialist agenda.
Do you think Bernie Sanders or Hillary Clinton will learn anything from that? Non, non, mon amis.