Editore"s Note
Tilting at Windmills

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April 20, 2011

CONSERVATIVES FOR HIGHER MIDDLE-CLASS TAXES.... Rep. Michele Bachmann (R-Minn.) talked to ABC's George Stephanopoulos this morning, and while most of the attention focused on her "birther" comments, Bill Scher flagged the far more important exchange.

The "Good Morning America" host noted the massive public support for raising taxes on those making more than $250,000 a year. Bachmann rejected the popular idea, and instead suggested the middle class should be expected to pay more.

BACHMANN: If we taxed 100 percent of what everyone made who make $250,000 or more -- everything they made -- that would get us about six months worth of revenue.

STEPHANOPOULOS: But every bit helps, doesn't it?

BACHMANN: Well, but it wouldn't be enough. I think that's what's shocking. We could take 100 percent of the profits of every Fortune 500 company and that would give us 40 days worth of revenue. We could also take 100 percent of everything that the billionaires in this country own, and that wouldn't be enough to solve the problem.

So it's really a matter of having everyone involved. Part of the problem, George, is that 47 percent of all Americans pay virtually no federal income tax, so we need to broaden the base.

For the record, I haven't the foggiest idea if Bachmann's statistics about the wealthy and Fortune 500 profits are accurate. Given her track record, I'd be cautious about accepting them at face value -- the strange Minnesota congresswoman has a habit of just making stuff up, pretending to understand things she's actually quite confused about.

The more important element to this is that Bachmann sees it as a "problem" that so many Americans don't earn enough money to pay income taxes. When the Republican lawmaker talks about "broadening the base," she means increasing the tax burden on low- and middle-income families.

Let's set the record straight. When conservatives talk about nearly 47% of the country paying no income taxes, the argument tends to overlook relevant details -- such as the fact that these same Americans still pay sales taxes, state taxes, local taxes, Social Security taxes, Medicare/Medicaid taxes, and in many instances, property taxes.

It's not as if these folks are getting away with something -- the existing tax structure leaves them out of the income tax system because they don't make enough money to qualify.

Moreover, let's appreciate the underlying point of the "problem" Bachmann wants to correct -- for all the talk on the right about cutting taxes at every available opportunity, there's also a desire to raise taxes on those who can least afford it. The GOP has a natural revulsion to any tax system, but there's an eerie comfort with a regressive agenda that showers additional wealth on the rich -- Bachmann supported the House GOP budget last week, that slashes tax rates for millionaires and billionaires -- while asking for more from lower-income workers.

In fact, the drive on the right to increase the burdens on these low- and middle-income families is getting kind of creepy. Some on the far-right have begun calling these Americans "parasites." Last year, Fox News' Steve Doocy went so far as to ask whether those who don't make enough to qualify for income taxes should even be allowed to vote.

But maybe I'm looking at this the wrong way. Perhaps the best solution is to simply have the debate. The Republican vision is to cut taxes by trillions for the very wealthy, while addressing "the problem" of getting middle-class workers to pay more. The Democratic vision is to increase taxes on the rich, at least a little, while leaving the rates the same for everyone else.

If Bachmann wants to take this case to the public, I don't imagine Dems would mind.

Steve Benen 3:35 PM Permalink | Trackbacks | Comments (60)

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Comments

This is just the latest step in the evolution of a kind of Randian social Darwinism that sees the rich as superior to everyone else and so utterly deserving of their riches that they can take whatever else they want. It seems that the more they get, the more they feel they have to justify it this way. And it just shows yet again the immense gulf between e elites and everyone else.

Posted by: Mimikatz on April 20, 2011 at 3:48 PM | PERMALINK

And don't forget the unemployed. They're "unwashed" according to my states Sen. Isakson. They should probably pay more in taxes too. Never thought I'd paraphrase Beck, but Some days I wake up and wonder what country I'm In.

Posted by: ComradeAnon on April 20, 2011 at 3:49 PM | PERMALINK

Stephanopoulos made the salient point: just because it does not solve the entire problem is no reason to reject a part of the solution. Now, Bachmann is right in that these things will not solve all of the budget / deficit mess but they will solve some of it and that is better than nothing.

How clueless she is. My guess is she wants it done a certain way and she has no idea how silly her rationalizations of other methods sound.

Posted by: Richard on April 20, 2011 at 3:50 PM | PERMALINK

Well in 2006 Forbes asserted that the 400 richest Americans had a cumulative value of 1.254 Trillion dollars.
http://www.usatoday.com/money/2006-09-21-forbes-chart_x.htm

I have not found this year's chart.

Posted by: mike on April 20, 2011 at 3:51 PM | PERMALINK

The Minnesota Loon's numbers don't make sense, but I'm not convinced that she is ACTUALLY trying to raise middle class taxes, so much as she is trying to frighten middle class taxpayers into agreeing that 'the problem' is that we're spending too much. I mean, if the government is spending so much that even after taking all the rich folks money we'd still need to raise taxes on us plain folk, well, then, government spending MUST be out of control.

Except here on planet Earth, it isn't, and even returning to the relatively mild rates of the Clinton era would fix things in due course. But Bachmann's numbers sure sounds good in Loon-ville.

Posted by: biggerbox on April 20, 2011 at 3:52 PM | PERMALINK

I've heard Bachmann spout these same numbers on several talk show/interviews - she's obviously got them memorized for the purpose of confusing the Tax ther Rich idea. She spits it out rapid-fire and the "host", like Steph, just sit there dazed and never asks "where did you get that".
The obvious fact is that the Bush Tax Cuts for the Rich DID create a big part of the deficit and repealing them would be significant. I hope PolitiFact will check her out soon.

Posted by: T2 on April 20, 2011 at 3:55 PM | PERMALINK

Git yer scatterguns! It's Lucky Ducky season!

Posted by: Grumpy on April 20, 2011 at 4:01 PM | PERMALINK

Politifact probably has an entire team devoted to fact-checking that moron.

Posted by: JCT on April 20, 2011 at 4:03 PM | PERMALINK

Her figures are ridiculous. Ending the Bush tax cuts would have cut the current deficit in half this year.

Businesses are sitting on two trillion in profits just from last year. That wouldn't help cut the deficit, if it were taxed at the 35% rate, which it never is? At even 10%?

Posted by: jjm on April 20, 2011 at 4:04 PM | PERMALINK

found 2010 Forbes 400 Americans total: $1.36735T

Posted by: mike on April 20, 2011 at 4:05 PM | PERMALINK

She pulls these numbers out of her ass. And why no one asks her to substatiate her claims make those interviewers suspect, too.

Posted by: dmnolan on April 20, 2011 at 4:09 PM | PERMALINK

biggerbox FTW. The message is that the Middle Class is NEXT, so we'd better cut spending lest they have their taxes raised.

Which, of course, they would be under Ryan's plan. And they already have a higher effective rate than the rich. But who's counting?

Posted by: Todd for VT House on April 20, 2011 at 4:14 PM | PERMALINK

Do you think she's talking about those mega-corporation like GE that take in tons of profits but don't pay any income tax? Nah, me neither.

Posted by: seems2me on April 20, 2011 at 4:19 PM | PERMALINK

47% of the country paying no income taxes, the argument tends to overlook relevant details

No. I think she might be right. You seem to be ignoring children and corporations (which are now part of THE BASE).

Posted by: Danp on April 20, 2011 at 4:23 PM | PERMALINK

Please we should only be so lucky. Bachmann is a friggin idiot. I favor a 'stress test' for the electeds and if they can't pass a reasonably tough test their salary is cut by 50%.

Posted by: robert on April 20, 2011 at 4:24 PM | PERMALINK

Please don't misconstrue this as any kind of attempt to defend or agree with Michele Bachmann, but there's another way to look at the statement, "So it's really a matter of having everyone involved. Part of the problem, George, is that 47 percent of all Americans pay virtually no federal income tax, so we need to broaden the base."

You could look at that and say, yes, if more Americans made higher wages and salaries by being fully employed and earning a living wage, then more Americans would be able to pay income taxes.

There can be little doubt that that's not where she's going with this. But its a point I'd like to hear somebody make.

Posted by: Will on April 20, 2011 at 4:24 PM | PERMALINK

"If Bachmann wants to take this case to the public, I don't imagine Dems would mind."

True. I imagine they'd agree with her, or at least meet her three-quarters of the way. Or is there some other Democratic Party you're referring to?

Posted by: Tom Allen on April 20, 2011 at 4:28 PM | PERMALINK

The poor have all the privileges! It works out great for them.

Except for the being poor part.

Posted by: g on April 20, 2011 at 4:30 PM | PERMALINK

Bachmann got her numbers from a Wall Street Journal editorial, and Geoffry Sachs debunked this piece in a post on the Huffington Post. Typical Fox News/WSJ drivel.

Posted by: Chris on April 20, 2011 at 4:33 PM | PERMALINK

She got all of these numbers from a blogger named Iowahawk (ggogle him and take a look). He is a bit of a nutter although he does have the gumption to go do some digging into the data. However, these numbers that are flying across the Tea Party spectrum are a real mess. They are only perfect for talking points.

Posted by: Don B on April 20, 2011 at 4:35 PM | PERMALINK
For the record, I haven't the foggiest idea if Bachmann's statistics about the wealthy and Fortune 500 profits are accurate.

You might not know that, but you should know they are irrelevant and meaningless, so that their accuracy is unimportant. She talks about how many "months of revenue" the strawman changes she talks about would produce, which is irrelevant and meaningless because:
* She isn't discussing the real proposals, and
* She isn't discussing how well either the real proposals or the strawmen she sets up are at addressing the actual gap between revenues and deficits, instead talking about months or days of revenue without any context to provide meaning.

The latter point is particularly important, since analysis of this point will show that here facts are wrong even on their own -- you don't need to know anything but the relative value of current revenues and spending to determine that. When she says that taxing those earning over $250,000/year at 100% would produce "six months of revenue", she acts as if that is saying that taking that rather extreme measure that no one is suggesting would do very little. In fact, what that means is that it would increase total federal annual revenues by half of their current value. (Which with revenues at about 15% of GDP and spending at about 24% of GDP, would just about close the deficit by itself; reducing the deficit from about 9% of GDP to about 1.5%.)

When she says taxing the profits of the Fortune 500 at 100% would produce "40 days of revenue", she likewise does so as if it suggests that measure would do little, rather than that it would increase annual federal revenues by more than 10% of current revenues (or about 1.5% of GDP, enough to close the budget gap when combined with her earlier strawman proposal.)

When she says that even adding her third strawman proposal (taxing billionaires property At 100%) on top of the preceding two wouldn't be enough to "do the job", she's obviously wrong, since her first two straw-proposals, by her own numbers, would, in fact, close the deficit entirely without resort to the third.

Now, of course, no one is talking about the confiscatory proposals she raises, because no one is trying to balance the budget overnight. But the proposals she raises and suggests would be inadequate would, in fact, by the numbers she claims, be enough to close the federal deficit immediately. With (since her third proposal isn't even necessary to reach that goal) some room to spare.

Posted by: cmdicely on April 20, 2011 at 4:36 PM | PERMALINK

if everyone just got a show on Fox news, we could work this out pretty quickly

Posted by: Jamie on April 20, 2011 at 4:37 PM | PERMALINK

Does it make me a bad Democrat if I say I wouldn't mind going back to the tax rates I paid under Clinton?

Posted by: Cazart on April 20, 2011 at 4:50 PM | PERMALINK

My response to all of these arguments to not tax the rich is: "how goddamned rich do you need to be?" This really is just about greed. The rest is smoke and mirrors.

Posted by: DelCapslock on April 20, 2011 at 4:59 PM | PERMALINK

Somebody needs to go through that 47% number a little. First, 24% of the population is under the age of 18, so we're down to 23%. Then about 2.1% is on SSI disability, so we're down to 21%. Then another 2+% are seniors over 65, living entirely on social security, which is not subject to taxes, which brings us down to 18-19%. Does Bachmann propose raising taxes on babies, babysitters, the blind and physically disabled, or the elderly poor? Or all of the above?

Posted by: David in NY on April 20, 2011 at 5:03 PM | PERMALINK

Some back-of-the-envelope scratching suggests that the annual profits (CY2009) of the Fortune 500 equals about 50 days' worth of total federal budget outlays (FY2010), 105 days of discretionary outlays, and 216 days of non-defense discretionary outlays.

Posted by: WatchfulBabbler on April 20, 2011 at 5:07 PM | PERMALINK

Bachmann and her fellow myopic intellectuals from the far Right don't get it! AT ALL!

Yeah, Michelle, make that family of five with two parents working two jobs each, pulling down $29,000 annually, to pay their fair share while they continue to find out where to put the living room sofa in their new house - the Chevy stationwagon they bought used, and have been allowed to park at their nearest relative's home!

Yeah Michelle, make those 47%ers pay! That way, your uber-rich fellow travelers won't have to forgo too much cavier this year, or have to sale the 2nd yacht to make ends meet!

Yeah Michell, get those 47%ers! Yeah Michelle, slap a 10% tax on their incomes so the example above will have $26,100 to live on for the year!

Yo, Michelle, your friends on the other hand, with the $250,000 income taxed at the current 36% rate will still have $154,000 to live off of, even though they may have to pinch a few more pennies to make ends meet!

Now don't get me wrong, I'm for paying my fair share, this year 14% of $75,000, but really Michell, from what I've heard recently, your friends won't even agree to a shared burden as I understand they are currently satisfied with their 0% to say 10% rates as they are.

Michelle Bachmann needs to grow a bit more intelligence before she is equal to an average thinker! Until then, we'll just have to keep hearing her ignorant drivel! -Kevo

Posted by: kevo on April 20, 2011 at 5:12 PM | PERMALINK

I actually think lower income people should face some federal income tax liability. We should all share in paying for defense, national parks, etc.

But that so high a percentage of Americans don't have federal income tax liability isn't the fault of poor people. Congress and the president have created the loopholes and various deductions that result in such a narrow tax base. And after 50-some odd years of conservative complaints about taxes, it seems odd for them to object to the fact that the tax base is so narrow.

Posted by: Bulworth on April 20, 2011 at 5:14 PM | PERMALINK

It's worth asking why George Snuffleupagus didn't immediately say, "So, wait, are you proposing to raise taxes on the poorer half of the country?" Because she sure seemed to be.

Posted by: FlipYrWhig on April 20, 2011 at 5:17 PM | PERMALINK

the current net worth of all american's assets is $55 trillion dollars....

PS
a household making $40k that has two kids and a mortgage almost certainly pays no income taxes.

Posted by: dj spellchecka on April 20, 2011 at 5:23 PM | PERMALINK

If her point is that the Bush tax cuts should go away - for everyone - I agree. (this includes the 10% tax bracket and increase in the child tax credit) Dependence on high income individuals does lead to higher highs and lower lows. But of course that's not the point.

Posted by: Calwatch on April 20, 2011 at 5:25 PM | PERMALINK

Here's another number to go along with that 47%...

Here is a chart that shows that 99.8% of that 47% earn $10,000 a year or less.

http://blogs.marketwatch.com/fundmastery/2010/04/08/47-of-americans-pay-no-income-taxes/

Posted by: Kewalo on April 20, 2011 at 5:28 PM | PERMALINK

When Steve Benen quotes polls that show most Americans are very excited about taxing the "very wealthy" to pay for their benefits, one can well imagine that that is quite a popular idea. Taxing someone else to pay for your benefits can always, in fact, be expected to be popular, particularly among Democrats.

However, as Michelle Bachmann has noted, raising tax rates to 100 percent, assuming people would still work when they hit that bracket, would even in the most optimistic scenario only supply a few weeks of spending on the freebies that Americans have come to love. Most of the taxable income in this country happens, in football vernacular, between the 40 yard lines, or, more specifically, betwee 50k and 200k per year, and that's where any politician will have to go to get the money.

And it is, of course, a massive problem when half the country does not pay federal income taxes. Yes, they pay other taxes, but most of them are too ignorant to know that. That's why they routinely vote for higher taxes on other people, unwittingly not knowing that most of these will simply be passed on to them. The Democratic Party has come to rely on this ignorance when pushing for "free" health care and "free" higher minimum wages, in fact.

Posted by: The Unwelcome Voice of Sanity on April 20, 2011 at 5:36 PM | PERMALINK

the "profits" as reported by FORTUNE of the top 500 American companies in 2010 is $390 Billion, but corporations do pay taxes on profits because that $390 Billion income taxes, depreciation, and a whole slew of other deductions and accounting gimics can manipulate profits to suit management's needs. Corporations pay taxes, in theory except for GE, on income not profit.

Income of the Fortume 500 in 2010 was 9.7 TRILLION dollars or about 2/3s of the American economy. Their profits are thus 4% of income. Right. Sure. With the top ten companies accounting for $1.7 TRILLION of that.

IF corporations really paid 30% of their income to the federal Government (Whose budget is $3.4 Trillion including social security .7 Trillion.) that would be $2.9 Trillion. The rest of us would only have to pay. $0.5 Trillion in income taxes.

If you subtract social security the Federal Governemnt's budget is $2.7 Trillion. Obviously, since we wre running a deficit some corporations are not paying their fair share.

Posted by: KurtRex1453 on April 20, 2011 at 5:44 PM | PERMALINK

Oh, would that the interviewer be allowed to ask what Ms. Bachmann's annual income is.

Posted by: Skip on April 20, 2011 at 5:46 PM | PERMALINK

Posted by: Skip on April 20, 2011 at 5:46 PM

"Oh, would that the interviewer be allowed to ask what Ms. Bachmann's annual income is."

What on Earth would that prove? The Obamas made millions last year, surely more than Bachmann. So what is your point, assuming you have one?


Posted by: The Unwelcome Voice of Sanity on April 20, 2011 at 5:49 PM | PERMALINK

A simple but effective rule for understanding any discussion of taxes:

If one party in the discussion will only discuss income taxes then they are ignorant, deceptive, or both.

Posted by: sven on April 20, 2011 at 5:58 PM | PERMALINK

Hey dj spellchecka - ever hear of payroll taxes? You know, those pesky real-time payroll income tax rates where the wage earner and his employer contribute so the wage earner has something to take home?

You know, when a wage-earner of say $40,000 as you point out above sits down to do his income taxes, he will discover he has already paid them by way of payroll deductions, and then he is allowed to claim himself as someone who depends on the wage, his wife, and his children - as without the wage, they would no doubt starve!

Well a simple formula leads the $40,000 a year wage earner to match the amount he has already paid to the federal or state government to his deductions to see if he gets some of the already paid income tax back, or if he will have to pay a bit more to close out the year's income tax obligation.

If he paid $8,000 in payroll taxes during the year, and can deduct approx. $5700 (a very high yield for a wage-earner who doesn't qualify for as many deductions and credits as those who are making over $100,000), he is still liable for the $2300 he has already paid into the Treasury over the course of the year!

In my book dj spellchecka, $2300 from $40,000 is NOT 0% taxes. Can you spell myopia? -Kevo

Posted by: kevo on April 20, 2011 at 6:00 PM | PERMALINK

Oh, and I forgot dj, how many fellow Americans do you know who are earning $40,000 a year and can even qualify for financing to even think about buying a house. Most $40,000 households are renters! -Kevo

Posted by: kevo on April 20, 2011 at 6:02 PM | PERMALINK

Wait, I thought the Republicans had styled themselves the "anti-tax" party? I thought they LIKED it when people don't pay any taxes???!

Posted by: Betsy on April 20, 2011 at 6:03 PM | PERMALINK

Posted by: KurtRex1453 on April 20, 2011 at 5:44 PM

"IF corporations really paid 30% of their income to
the federal Government (Whose budget is $3.4 Trillion including social security .7 Trillion.) that would be $2.9 Trillion. The rest of us would only have to pay. $0.5 Trillion in income taxes."

Uh huh. One question. In this world of yours, where corporations don't pass on higher taxes to their customers (me and you) in the form of higher prices, less hiring, and more outsourcing to other countries: what color is the sky there?

Honestly, how do even liberals let statements like these go by without correction? For those of you who know better, do you simply feel that such ignorance is sufferable because it suits your purposes?

Posted by: The Unwelcome Voice of Sanity on April 20, 2011 at 6:04 PM | PERMALINK

I think it is fair that the middle class and the working poor should pay more in taxes. That way they will better appreciate the true cost of their freedoms here in the US. And by the same token, I think that the top 1% of earners should send their children to join the Army as enlistees so they can go off to Afghanistan and Iraq and fight the wars that their parents support, so they will better appreciate the true cost of their freedoms here in the US. Fair is fair.

Posted by: majun on April 20, 2011 at 6:05 PM | PERMALINK

She's probably referring to this:

http://www.youtube.com/watch?v=661pi6K-8WQ&feature=youtube_gdata_player

And it is beyond stupid because it assumes starting at zero and doing the things she's mentioning.

Stupid leading stupid here.

Posted by: Mark on April 20, 2011 at 6:14 PM | PERMALINK

Every time a Republican makes that "50% don't pay income taxes" crap statement, every interviewer or Democrat within striking distance of a microphone should point out that that 50% only has about 10% of the country's income. To use Bachmann's current device, you could confiscate the entire incomes from this segment of the country and it wouldn't even pay for 30 days of running the government.

Posted by: digitusmedius on April 20, 2011 at 6:18 PM | PERMALINK

Most of what she said is nonsense, and sadly, there is a boat load of drivel in some of these comments. Happily, someone did point out a few facts:

- Of the 47%, many are people who are too old, too poor, too sick, or too young to pay much

- Of the remaining, most of us who do not pay income tax still pay payroll taxes, which are wildly regressive

- Income distribution is wildly non linearly distributed; As we all know, there is absurdly huge wealth and income for the top 1 %; merely huge for the next 10%, etc. The lowest 50% of income earners, who, btw, earn most of their income, by, um, working, generate relatively small fraction of total income [while probably being responsible for much fo the GDP through their work]. SO to be counter absurdist - and likely more accurate; we could tax the lower two quartiles at 80%, and get very little added income to the government

- Most of us do understand very well that taxes on corporate incomes would impact other, worthy effects of corporations - likel, employment, etc. However, what is the cost, and lost opportunity costs, of the tax dodges, feints, and other methods corporations use to avoid taxes ? How much is sucked up in the non productive tax avoidance industry, rather than making things? Since dividends are favorably taxed already, and by tax avoidance, corporations and their share holders pay a lower rate, while still benefiting from roads, what schools are left, the military, etc., while the lower 50% actually serve in the military, build the roads, etc...


So, unwelcome voice, thanks for the perspective, but the picture is different from what you paint. I would be happy with a 15% corporate tax rate; fewer tax breaks for antiquated industry favored staus, and a tax system that allows companies to make decisions that maximize their profit, not minimize their tax liability. That is a conservative idea, n'est pas mon ami?


Posted by: bigtuna on April 20, 2011 at 6:31 PM | PERMALINK

Michelle Bachmann: "So it's really a matter of having everyone involved. Part of the problem, George, is that 47 percent of all Americans pay virtually no federal income tax, so we need to broaden the base."

Is there a right wing ideologue alive who hasn't made this ridiculous and deliberately deceptive statement.

Posted by: max on April 20, 2011 at 6:32 PM | PERMALINK

I miss Tim Russell.

Posted by: clevergirl on April 20, 2011 at 6:52 PM | PERMALINK

I think Rep. Bachmann is merely stating what she and her supporters believe; ie, THEY will NEVER need ANY of these programs so why in the hell should THEY pay anything towards them?
To these people, "Greed is good" isn't a catch-phrase from a movie, it's a life-style...

Posted by: Doug on April 20, 2011 at 7:34 PM | PERMALINK

Actually there is a right way to get the lower half to pay a bit more, and it would help the nation: higher gas taxes. But conservatives keep complaining about that.

Posted by: neil b on April 20, 2011 at 8:38 PM | PERMALINK

Hwy The Unwelcome Voice of [In-]Sanity, don't you realize that if you're right and those taxes are passed on, then that means the lower half *do* effectively pay more than their direct rate so that isn't the same condition to complain about any more. Idiot.

PS: Only some of taxation can be passed on because after all, the market determines prices and sellers can't just recoup as much of cost as they'd like (you think you're so smart, didn't you know that?) Look up "tax incidence."

Posted by: neil b. on April 20, 2011 at 8:42 PM | PERMALINK

I think she got her number her (or the same place these people got it)

http://citizensnews.blogspot.com/2011/04/answer-is-in-numbers-whose-numbers.html

"By the way, $250,000 per year hardly qualifies one as being rich. It's not even yacht and Learjet money.

All told, households earning $250,000 and above account for 25 percent, or $1.97 trillion, of the nearly $8 trillion of total household income. If Congress imposed a 100 percent tax, taking all earnings above $250,000 per year, it would yield the princely sum of $1.4 trillion. That would keep the government running for 141 days, but there's a problem because there are 224 more days left in the year."

The problem is this odd number "$ 8 trillion total household income." This makes no sense as it implies that gross of tax household income is only slightly more than half of GDP. Uh uh. For one thing "total household income" is not a standard BEA category. The closest is total personal income which is about 13 trillion a year. 8 trillion corresponds (roughly) to total adjusted gross income(ask Emanuele Saez http://elsa.berkeley.edu/~saez/). I don't know why this is so much lower than personal income (I assume it isn't massive tax fraud).

I have no idea where they got the 25% number. Notice that they are comparing the money from the top 2 or 3% to the whole budget including social security, but not counting the payroll tax or any income taxes on income under 250,000.

Bachman is, as usual confused.

I think the "not even yacht or learjet money" might be a useful addition to the debate.

Posted by: Robert Waldmann on April 20, 2011 at 8:47 PM | PERMALINK

Steve,

You make good points and I'd like to add that Social Security and Medicare have run surpluses for most of their existence. These excess funds, amounting to about $3 trillion or 20% of the total debt, are stored in Treasury securities and have been helping float our budget deficits - which in turn funded massive tax cuts for the wealthy. And now they want to cut benefits instead of raising taxes on income over $250K?

Posted by: Bob on April 20, 2011 at 9:07 PM | PERMALINK

Steve,
I think some of her figures are coming from a You Tube rant by Bill Whittle called "Eat the Rich"

Posted by: James on April 20, 2011 at 9:23 PM | PERMALINK

I think it was Mark Twain who said: "There are lies, damn lies and statistics."
One thing this all (Bachmann and comments) shows is that statistics, w/out context, are worthless. They are like putty; make whatever shape you wish. The 47% figure, standing alone, is absurd and misleading. David in NY illustrates that w/his breakdown. Cherry picking and the straw man tactic (thank you cmdicely)are classic ploys to distort an issue and evade pointed, rational discussion. Bachmann and it's ilk practice that all the time. It is what you do when you are, rhetorically speaking, standing on thin ice. It is a drastic failure of the media,
obviously, to let this crap fly unimpeded.

Posted by: Stephen Wend on April 20, 2011 at 10:05 PM | PERMALINK

Bachman's numbers are full of crap.
Top 1% pays about 17% to the feds in taxes and this accounts for about 20% of total fed intake.
Raising that to 100% would generate 6 times as much revenue so would bring total inflow to 240% of existing revenue.

Some data sources
1) to back up that 70% of income tax is paid by top 1%
http://www.heritage.org/budgetchartbook/top10-percent-income-earners
2) Receipts to get the payroll tax numbers
http://www.census.gov/compendia/statab/2011/tables/11s0478.pdf
3) Further fine detail on sources of tax receipts.
http://www.census.gov/compendia/statab/2011/tables/11s0473.pdf
4) pie chart version of 2 & 3 - easiest for you to see the big picture.
http://en.wikipedia.org/wiki/File:U.S._Federal_Receipts_-_FY_2007.png

Facts "distilled"
1) Individual Income tax in 2009 $915 Billion (70% of this to the top 1% I believe this includes Interest and Cap Gains - both taxed at 15%)
2) Payroll tax $ 881 Billion (95% of this to the bottom 95%)
3) Excise taxes (gas, liquor, tobacco ) $62 B (give this to the bottom 95%)
4) Worker bees pay more taxes (adding their income tax to the payroll taxes and excise taxes) than the uber-rich ownership sect even though the "right" complains they pay much more - this is because they only look at income taxes. Listen to the rhetoric, it is ALWAYS rants about "income taxes" and "lucky duckies that pay no income taxes" and "50% pay not income taxes" etc.
5) Income taxes are about 42% of total VS. payroll + excise are also about 43% of total - close enough for me to call them equal.
6) If 70% of income taxes in 2009 were paid by the top 1% and around 3/4ths of this is paid by the top 0.25% - those that earn over $1million. So the top 0.25% of earners pay about 20% of total taxes in the country [ 0.7 * .42 * .75 = .22] . So if their total tax bite drops from 32% (1st year of Bush) to 22% (2009) then the total drop in the intake by the Federal government is roughly at 10% in total federal intake. [ .22 (taxes paid)* .32(clinton rate) / .22(2009 rate) = .32]. [ 32% - 22% = a 10% drop in Fed revenue] {yes I know I am being a bit loose with this as the size of the pie changes so the become about 9% but close enough for lat night ranting}.

So cutting taxes to insanely low levels for the uber-rich ownership sect costs us about 10% of our federal tax revenue (or just about all of our deficit prior to Obama's Keynesian stimulus spending in FY 2010 and 2011). So if we kept the Clinton era tax bite on the uber rich owner ship sect we would be running almost no deficits long term and without the 2008 Great Recession we would have paid off much of our national debt during the lost decade of the Bush Years.

Posted by: joyzeeboy on April 20, 2011 at 10:32 PM | PERMALINK

The primary reason that so many people don't pay income taxes is deductions, including exemptions and credits for having children. See if anyone in congress, including Republicans has the nerve to reduce these deductions. And I am sure that Bachmann wasn't complaining with all her children and I am sure she took every deduction she could get.

Having said that, I don't think people should get deductions or credits for having children. They do impose costs on society.

Posted by: tom street on April 20, 2011 at 11:18 PM | PERMALINK

"Having said that, I don't think people should get deductions or credits for having children. They do impose costs on society. "
Children are society, without them what do we have?

Posted by: joyzeeboy on April 21, 2011 at 10:43 AM | PERMALINK

Joyzeeboy, it's not whether to have any children at all. The question is, why should the rest of us have to subsidize other people's kids directly when we're already paying for public education, and also population increase increases pressure on resources, making gas cost more etc.

Posted by: Neil B on April 21, 2011 at 11:37 AM | PERMALINK
Having said that, I don't think people should get deductions or credits for having children.

They don't.

People get deductions or credit for providing support for children, much as they do for providing their own primary support, or for providing support for certain other adults.

The fact that, under normal circumstances, being the biological parents of a child mean that you are also, by default unless alternative arrangements are made, primarily responsible for the support of children, and that most often those people don't chose to give that role to someone else, means that usually those credits and deductions happen to go the biological parents of the child, but, from the point of view of the tax policy at issue that's incidental. In fact, there are substantial additional tax subsidies for some of those who aren't biological parents but choose to care for a child (e.g., there is both a tax credit and tax deduction for qualified adoption expenses.)

Posted by: cmdicely on April 21, 2011 at 12:11 PM | PERMALINK

@ kevo....my comment specifically mentions income taxes, not federal taxes. i totally understand that lower income americans pay lots of taxes, both federal and local....

I put that up not to claim those folks are lucky duckies, but to point out they're not unproductive deadbeats...

Tom Street puts it better "The primary reason that so many people don't pay income taxes is deductions, including exemptions and credits for having children. "

pretty sure we're on the same side here.....

ps
a recent study from iowafiscal.org notes:
"While a family of four making $40,000 owes no federal income tax, that family
owes more than $1,200 in Iowa income taxes."

http://www.betteriowa.org/Resources/110216-IFP-HF194.pdf

cheers
dj


Posted by: dj spellchecka on April 21, 2011 at 1:33 PM | PERMALINK
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