Editore"s Note
Tilting at Windmills

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April 17, 2009

TAXES, IN CONTEXT.... Last week, Bruce Bartlett, a former Treasury Department economist in the Bush administration, wrote an interesting column comparing U.S. tax rates with countries around the world. Bartlett, a conservative, found that the United States "is a relatively low-tax country no matter how you slice the data." In 2006, total taxation (federal, state and local) amounted to 28% of the GDP. Of the 30 countries in the Organization for Economic Cooperation and Development, only four had a lower tax ratio than the U.S.

But, conservatives said, who cares what kind of taxes are imposed by other industrialized democracies? Since when do we care? So, this week, Bartlett went with a different approach, comparing the current U.S. tax structure with recent generations.

bartlett.JPG

The exercise is straightforward enough. Bartlett identified the "effective federal income tax rate -- taxes paid as a share of income -- for a family with the median income. The median is the exact middle of the income distribution -- half of families are above and half are below. It's as close as we can get, statistically, to the typical American family."

He found that the median family, in the most recent year available, "paid 5.91% of its income to the federal government in the form of income taxes." In 1981, the median family paid double, and current rates are "well below the rate that prevailed from the 1950s through the 1990s."

What's more, the 2009 numbers are almost certainly lower than 2007, thanks to Obama's middle-class tax cut.

Given all of this, Bartlett draws the right conclusion about the "Tea Party" events this week, where Tea Baggers complained bitterly about a crushing tax burden: "I believe this was largely a partisan exercise designed to improve the fortunes of the Republican Party, not an expression of genuine concern about taxes or our nation's fiscal future. People should remember that while they have the right to their opinion, they are not entitled to be taken seriously."

Post Script: For the record, I made this chart, using the table in Bartlett's piece. I'm hoping to break into the lucrative world of chart blogging someday.

Steve Benen 1:10 PM Permalink | Trackbacks | Comments (35)

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Comments

Wingnuts will probably use this information to say that the average American is not paying enough in taxes. This will be proof for them that rich people are really getting shafted.

Posted by: Matt on April 17, 2009 at 1:17 PM | PERMALINK

Leaving out the 1986 increase in FICA taxes leaves the picture somewhat distorted. That tax increase was to create the SS trust fund, but it also had the effect of financing the Reagan deficits in a way that allowed the tax picture to be presented dishonestly.

Posted by: Tom on April 17, 2009 at 1:19 PM | PERMALINK
"paid 5.91% of its income to the federal government in the form of income taxes.

But, but ... the wingnuts keep telling me that Obama is going to tax us into fascism (or is it socialism this week? I can never keep up) and that our kids will have a tax burden of, like, eleventy million percent and they'll have to work 27 hours a day and only get some stale bread from some gay abortion provider and ...

**deep breath**

... he's then going to give all those jobs to illegal aliens and put anyone who complains into a concentration camp just like Hitler did while providing commie health care and telling us all how much fat we can eat and ... um ... uhhhh ...

Damn. Trying to be a wingnut is making my head hurt. I really don't understand how they do it. Really.

It is nice, though, to know not every conservative has decided to double down on the crazy and have some numbers with which to bag the tea folks.

Posted by: Mark D on April 17, 2009 at 1:21 PM | PERMALINK

Interesting, as far as looking at it from the perspective of Federal Taxes. This, of course, is but a portion of the overall taxes paid by individuals in this country.

Has anyone looked at it from an overall perspective, including the variances which result from the myriad of different state income taxes, sales taxes and property taxes. I know this is a much more complicated endeavor than the Federal Tax graph, but it would be a bit more revealing on the actual percentage that we, as citizens, pay.

Since April 15 is just behind us, can some of us take a quick look at our returns and see what the overall percentage is we have paid and compare it to some median income levels for our individual states?

Just curious as to how something like that would compare to Bartlett's graph.

Posted by: Mike on April 17, 2009 at 1:21 PM | PERMALINK

And of course all those Republicans who want to see their taxes cut don't want to see any of their services cut....

Posted by: mfw13 on April 17, 2009 at 1:22 PM | PERMALINK

For short, it's called "clogging."

Posted by: bleh on April 17, 2009 at 1:24 PM | PERMALINK

One serious comment:

It is a bit misleading, as state taxes, Soc. Sec., Medicare, and even city taxes (like those of us who work in K.C.) add to the burden.

Granted, that doesn't change the fact that the teabaggers are clinically stupid and/or insane. Just sayin'.

Oh, and nice chart. :-)

Posted by: Mark D on April 17, 2009 at 1:25 PM | PERMALINK

Yes, yes, mfw13! Almost everyone on all sides of the tax debate talks about tax money as if we just send it into the twilight zone. We don't.

TAXES ARE PAYMENTS FOR GOVERNMENT SERVICES.

Maybe we need to be reminded of that a little more frequently.

Posted by: AnnieCat on April 17, 2009 at 1:28 PM | PERMALINK

"What's more, the 2009 numbers are almost certainly lower than 2007, thanks to Obama's middle-class tax cut."

There has been no tax cut. No law has been enacted that lowers the tax rates. The increase in take home pay due to the lowering of withholding this year will be taxable income that you have to pay next year.

Or didn't you know that, Steve.

Posted by: Chicounsel on April 17, 2009 at 1:32 PM | PERMALINK

Chicounsel wrote: "Or didn't you know that, Steve."

We know that you are a deliberate, conscienceless liar.

Posted by: SecularAnimist on April 17, 2009 at 1:41 PM | PERMALINK

People should remember that while they have the right to their opinion, they are not entitled to be taken seriously.

Love this line.

Posted by: g on April 17, 2009 at 1:50 PM | PERMALINK

Well, not to burst anyone's bubble, but I believe their "high taxes" complaint has less to do with current rates than with concern over what future rates will become based on spending and deficits. I don't altogether agree with either their premise, or solution, or with their approach to addressing them. But refuting their arguement does require that one address the actual arguement.

Posted by: Bill H on April 17, 2009 at 1:51 PM | PERMALINK

"It is a bit misleading, as state taxes, Soc. Sec., Medicare, and even city taxes (like those of us who work in K.C.) add to the burden."

True, but not by that much, seeing that most people get to deduct state and local income taxes (and those whose states do not assess income taxes get to deduct state sales taxes) from their federal income. And as Social Security and medicare will and do, to some extent, provide to the payor "assets" by way of benefits (usually later inlife, but for many unfortunate people sooner than that).

Posted by: bubba on April 17, 2009 at 1:52 PM | PERMALINK

I believe their "high taxes" complaint has less to do with current rates than with concern over what future rates

Don't kid yourself. This is only one of the later bumper sticker arguments teabaggers made after earlier versions were laughed off the stage.

Posted by: Danp on April 17, 2009 at 1:59 PM | PERMALINK

"I'm hoping to break into the lucrative world of chart blogging someday."

Don't quit your day job!! LOL

Posted by: barkleyg on April 17, 2009 at 2:00 PM | PERMALINK

I found amusing some of the pictures of signs I saw in the coverage of the teabag parties: "No Taxes." Like, these people want to pay NO taxes, and yet still have things like fire, police, utilities, and military protection. Just how are these services going to get paid for? And aren't the same kind of folks yammering about Obama "cutting off the legs of our brave troops" by "Cutting defense spending?"

Of course we lefties have our own loonitoons, like the chanters at the G-20 summing saying "ABOLISH MONEY!" But our loonie lefties aren't being promoted by Fox News.

Posted by: Eeyore on April 17, 2009 at 2:02 PM | PERMALINK

Nice chart, I found one that shows the Federal Deficit as percent of GDP. Side by side they're fascinating especially when you note which party was being fiscally conservative and which one wasn't. Chart at http://tinyurl.com/c4x6ym

Posted by: jpmist on April 17, 2009 at 2:06 PM | PERMALINK

And of course all those Republicans who want to see their taxes cut don't want to see any of their services cut....
No Ace, just yours.

Posted by: Govt Skeptic on April 17, 2009 at 2:10 PM | PERMALINK

Pay down the debt by allowing taxpayers to choose between the Obama Tax Rate and the Reagan Tax Rate.

I was sooooo hoping someone would ask one of those red blooded Americans with a teabag hanging off their hat if they want the Congress to returns us to the era of Reagan tax cuts.

Posted by: bcinaz on April 17, 2009 at 2:12 PM | PERMALINK

For short, it's called "clogging."

I preferring "chogging."

But then, who doesn't?

Posted by: Midland on April 17, 2009 at 2:15 PM | PERMALINK

It's not that the teabaggers care about taxes themselves, or (as many other reality-based people have pointed out) they would have also protested the Iraq War, our bloated defense budget, etc. They just care what their taxes are being spent on. A Libertarian acquaintance of mine went to one of the teabagging parties and when someone asked him why, he said because he didn't want his hard-earned money going to poor people. He's a dickhead, but an honest one at least. LOL.

Posted by: PattyP on April 17, 2009 at 2:23 PM | PERMALINK

We keep saying that allowing the term-limited Bush cuts to lapse takes us back to Clinton's rates. That's not going to convince anyone. We need to point out how the current taxes compare to their hero Reagan.

Posted by: Greg Goss on April 17, 2009 at 2:31 PM | PERMALINK
Well, not to burst anyone's bubble, but I believe their "high taxes" complaint has less to do with current rates than with concern over what future rates will become based on spending and deficits.

No, it wasn't. It was a post hoc excuse they created after they were exposed as being a bunch of lying and/or clueless twits.

I don't altogether agree with either their premise, or solution, or with their approach to addressing them. But refuting their arguement [sic] does require that one address the actual arguement [sic].

What argument is there to address?! That someone, somewhere, at some indefinite and undefined point in the future, may do something they disagree with?

Really?

Dear god ... using that logic, I guess I should start protesting about how the next GOP president is going to nuke Iran, or against not enough parking spots for our flying cars, or the new conservative government on Beetleguese Five.

(This is usually where I point out that none of these teabagging clowns said a single f-ing word about Bush shorting the Treasury of a few trillion thanks to his tax cuts, Iraq, and deficits; nor his violations of the Constitution; nor his profligate spending. But that would only be to, hopefully, get wingnuts to think and self reflect. They are, however, incapable of either of those, so I will no longer bother.)

Please take the "we got exposed as tools and now must come up with a new reason, lest we look like even bigger tools!" crap elsewhere.

We here know that the protests are nothing more than a conservative temper tantrum thrown by people unable to accept the fact their worldview has been summarily rejected by a vast majority of Americans.

So stop. Just ... stop.

Posted by: Mark D on April 17, 2009 at 2:36 PM | PERMALINK

"I'm hoping to break into the lucrative world of chart blogging someday."

Then you need to shape up. Your chart should have had a scale of 4 to 14 instead of 0 to 14 to make the highs look higher and the lows lower. Get a copy of Darrel Huff's (1954) classic "How to Lie with Statistics" and keep it close at hand.

Posted by: Jay C. Smith on April 17, 2009 at 2:47 PM | PERMALINK

CHART~!

Posted by: TG Chicago on April 17, 2009 at 2:58 PM | PERMALINK

for a family with the median income.

Not that it isn't a valid subcategory to examine, but it is a subcategory. Median household income is the standard measure when talking about these issues.

Posted by: PeakVT on April 17, 2009 at 3:09 PM | PERMALINK

Most informed people knew this but tea baggers will never know it unless it is on TV or the radio.
Remember the claims that they only listen to FOX news.

btw Steve...your chart is good but begs the question...what the hell do you do with your spare time?

Posted by: bjobotts on April 17, 2009 at 3:11 PM | PERMALINK

The majority of signs I saw had little to do with "taxes".

These people can't deal with an ever enlarging world. Government must grow to keep up with a growing population and marketplace. O course taxes will go up but they should increase on those who are gaining the most from our Commons. A 3% tax increase on wealthiest Americans is no big deal. Rolling back the Reagan tax cuts will pay for infrastructure and health care and Education AND switching over to renewable energy.

Don't work to shrink government...work to make it more efficient. Complaining about paying taxes means no gratitude for all that taxes provide.

Tea bagging events were hardly about taxes...that'
s why they were supported by Fox and republican mouthpieces (Gingrich, Beck, Hannity, Perry, Rush, Bachmann etc. - all millionaires- all republicans).

Posted by: bjobotts on April 17, 2009 at 3:24 PM | PERMALINK

The difference between a physical scientist and a social scientist is a physical scientist biases his opinion towards the facts, and a social scientist biases his facts towards his opinion...

Not that I in any way disagree with this post, but I think a more complete picture could and should be painted. I also was under the impression that the minimum amount to pay in gross taxable income was 10%, so is the average American only taxed on 60% of it's total income?

Posted by: ssat on April 17, 2009 at 3:42 PM | PERMALINK

According to the republicans, government programs are socialism, welfare etc. I wonder how many of the republicans in our government say no to the pensions they get, after very little time in government,of social security, of the medical insurance we pay for, how about the allowances for housing and office staff for them, the taxpayer funded travel - the list goes on and on.I guess they feel it is OK for them, but no one else must get pensions or health care.

Posted by: JS on April 17, 2009 at 3:45 PM | PERMALINK

There has been no tax cut. No law has been enacted that lowers the tax rates. The increase in take home pay due to the lowering of withholding this year will be taxable income that you have to pay next year.

There was a tax cut passed as part of the economic stimulus plan:

Economic Stimulus Package - Tax Cuts

FWIW, the same claim seems to have it's origins in GOP talk radio circles, which is of course no surprise.

Posted by: David W. on April 17, 2009 at 3:50 PM | PERMALINK

Nice chart. But I doubt that these tax protestors are much concerned about the tax burden of the median family, even if they happen to be members of that family. They appear to be outraged by the tax increase on people at the high end of the income distribution.

It's a form of Republican altruism.

Posted by: tamiasmin on April 17, 2009 at 4:25 PM | PERMALINK
Nice chart, I found one that shows the Federal Deficit as percent of GDP.

http://tinyurl.com/c4x6ym

Posted by: jpmist on April 17, 2009

Thanks for that link. It's pretty nifty.

usgovernmentspending.com

Posted by: MarkH on April 17, 2009 at 5:19 PM | PERMALINK

I also heard Tony Blankley this morning on the radio making the claim there had been no tax cuts, only an increase on cigarettes.

Liars, hypocrites, bad math? Join the Republican Party and begin a run on banks or lead your state to secede. Success can be yours if you go to a tea party and decry taxes that *might* be raised some time in the future.

Posted by: MarkH on April 17, 2009 at 5:23 PM | PERMALINK

Most of the teapartying was indeed designed to spin things the Republican way etc. However, here and there some of them made good points:
1. Increasing debt long-term is not good and is indeed a burden on our kids as their little signs imply. Remember that most of us like to brag of how the deficit was brought down during the Clinton years and went back up during Bush years (Cheney: "Reagan taught us that deficits don't matter.")
2. Their populist suspicion of the banking/Federal Reserve/financial system, Wall-Streeters like Geithner etc, is a good thing that we should collaborate with - it's a great day when both Paul Krugman and rednecks are suspicious of the same institutions. (And I don't trust progressives who think "populism" is a dirty word even when applied to non-nativist issues.)

Posted by: Neil B ☺ on April 17, 2009 at 6:00 PM | PERMALINK




 

 

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