Higher taxes for thee but not for me
Recent polls indicate that Americans overwhelmingly support raising taxes on the rich:
…[A] new POLITICO/Morning Consult poll released Monday that found 76 percent of registered voters believe the wealthiest Americans should pay more in taxes. A recent Fox News survey showed that 70 percent of Americans favor raising taxes on those earning over $10 million — including 54 percent of Republicans.
The numbers suggest the political ground upon which the 2020 presidential campaign will be fought is shifting in dramatic ways, reflecting the rise in inequality in the United States and growing concerns in the electorate about the fairness of the American system.
Actually, I think it reflects a lot of other things, too.
The first is the surge in Democrats and/or the MSM pushing the idea as a great one.
The second is human nature, which is the reason the Ten Commandments include a prohibition on “coveting.”
The third is widespread ignorance about what percentage of our taxes the rich already pay.
The fourth is widespread ignorance about what higher tax rates actually mean in terms of whether such rates will end up raising the total tax revenue collected, or what it would do to the economy in general. But my guess is that most people not only are not aware that higher rates on the rich do not necessarily translate to higher tax revenue, but many don’t care because the driving force behind this for many people is to punish the very rich.
So, what percentage do the rich already pay [this data is from 2016 taxes, the most recent I could find]?:
The latest federal income tax data reported by the IRS shows that the top 1 percent of income earners pay 39.5 percent of all federal income taxes, nearly twice the 20.6 percent share of national income they earn. The entire bottom 50 percent of all taxpayers pay 2.7 percent of federal income taxes, which is only a small fraction (about one fourth) of their share of national income.
The top 1 percent, indeed, pay a much bigger share of federal income taxes than the entire bottom 90 percent of income earners, who pay only 29.1 percent of federal income taxes, while earning 53 percent of national income. That means as well that the top 1 percent pay a bigger share of income taxes than the entire middle class combined, defined as the middle 20 percent of income earners.
The author of that article (written in 2017) adds:
[Democrats such as Liz Warren] know that what they are saying is false, because the above data is all publicly available and they are not stupid. But they know their Democrat voter base has no idea what the rich pay in taxes, and they can stoke envy and anger among them with their false demagoguery, enhancing their turnout at the polls.
They know the so-called mainstream media will never tell the public the truth either. CNN employs economic analysts, but you will never see CNN interview one of them for five minutes on air about whether the data says the rich pay their fair share of taxes without a chorus of left wingers to shout them down.
By the evidence of the polls I cited at the beginning of the article, it’s not just Democrats who fall for this. Fifty-four percent of self-identified Republicans agreed that taxes on the very rich should be raised.
Opinion on this also depends in part on how the “very rich” is defined. Ten million dollars seems safely high, and so more people are going to support that as a cutoff. But the history of such raises is that there is downward creep. In fact, the Sixteenth Amendment, which was passed to allow an income tax, was presented as only affecting the very very rich:
Thirty-six state legislatures had to ratify the 16th Amendment before it could go into effect. The public and most newspapers seemed to favor it. The main argument for ratification was that the amendment would force the wealthy to take on a fairer share of the federal tax burden that had in the past been largely carried by those earning relatively little. Only a few critics spoke out forcefully against the amendment. John D. Rockefeller, one of the country’s richest men, stated: “When a man has accumulated a sum of money within the law. . . the people no longer have any right to share in the earnings resulting from the accumulation.”
Ratification moved slowly but steadily through the state legislatures. Some of the states had already passed income tax laws of their own in seeking new ways to finance public schools and other social needs. Surprisingly, the income tax amendment drew widespread support in cities and in rural areas alike, from both Democrats and Republicans, and in all geographical regions. Even New York ratified the amendment despite the state’s reputation as the capital of “money power” with numerous millionaires among its residents (including John D. Rockefeller). By early 1913, 42 states (six more than needed) had ratified the income tax amendment. Only six states rejected it…
Rep. Cordell Hull introduced the first income tax law under the newly adopted Sixteenth Amendment. He proposed a graduated tax starting with a 1-percent rate for incomes between $4,000 and $20,000 increasing to a top rate of 3 percent for those earning $50,000 or more…
The first tax collection day under the new law took place on March 1, 1914. Since the average worker earned only about $800 a year, few people actually had to pay any federal income tax. Less than 4 percent of American families made an annual income of $3,000 or more. Deductions and exemptions further shrank the pool of taxpayers. Nevertheless, the federal government collected $71 million that first year. Millionaire John D. Rockefeller alone paid an estimated $2 million.
All in all, most Americans thought the new tax was a great idea.
Democrat politicians always want to raise taxes.
The super-rich tend to vote heavily Democrat.
Therefore, we can conclude the super-rich want higher taxes.
I don’t really see the problem.
The problem is that the super-rich don’t get taxed on income. They have things set up to where their money comes in as capital gains, which is taxed at a much lower rate.
This is why talk of raising taxes on the rich is absurd. The rich don’t pay income taxes, period. This is why Warren Buffett and Mitt Romney get taxed at 14% and some dude pulling in $150K a year pays a much higher percentage.
This is all smoke and mirrors and virtue signalling.
Artfldgr:
As our host Neo has noted “you all” is the mark or a troll. Restart your own blog or howl at the moon. Tedious.
Revenue Act of 1913
also known as the Tariff Act
the Underwood Tariff
Underwood Tariff Act
i thought the dems hated tarrifs?
EVER see these rates adjusted for inflation?
There was an exemption of $3,000 for single filers and $4,000 for married couples. Therefore, the 1% bottom marginal rate applied only to the first $17,000 ($374,400 in 2010 dollars) of income for single filers or the first $16,000 ($352,300 in 2010 dollars) of income for married filers
Well, 3000 then was equal to $66,100 in 2010
In 2010 dollars, the 2010 personal exemption ($3,650) and the standard deduction ($5,700) for single filers were together $9,350, only 14.1% of the 1913 exemption of $66,100 in 2010 dollars
the top marginal income tax rate of 7% in the 1913 Act was mentioned in Ronald Reagan’s remarks on the South Lawn of the White House on October 22, 1986, when he said that the top rate was for “the equivalent of multimillionaires today.”
500k in 1913 = $11,010,700 in 2010
The Act also created a new group of tax-exempt organizations dedicated to social welfare. The provision was a precursor to what is now Internal Revenue Code Section 501(c)(4).
basically the progressives did this to get YOU to fund the change to communism!!
but but… you left out THE MOST IMPORTANT STUFF
so, the 1913 TARRIF.. not tax… was 7% for 500,000 (11,000,000 today)
(i will let someone else explain why and what we forgot)
what came next????????!!!!!!!!!!!!!!!!!!!!!!!!!!!!
Revenue Act of 1916?? – raised the lowest income tax rate from 1% to 2% and raised the top rate to 15% on taxpayers with incomes above $2 million. (Previously, the top rate had been 7% on income above $500,000.) The Act also instituted the federal estate tax.
Well, afer costing blacks and women the vote, getting the first low tax in, and running on a platform of no war, we got into the war and…
War Revenue Act of 1917 – greatly increased federal income tax rates while simultaneously lowering exemptions. The 2% bracket had previously applied to income below $20,000. That amount was lowered to $2,000. The top bracket (on income above $2 million) was raised from 15% to 67%. [multiply by 2300 to get 2010 amts!!!]
The Revenue Acts of 1918 – raised income tax rates over those established the previous year. The bottom tax bracket was expanded but raised from 2% to 6%.
HEY… neo? why you never talk about this when you talk about leading up to the GREAT DEPRESSION? because you have how much being taken and how much being raised each year for PROGRESSIVE comunism?
Revenue Act of 1921
yet it still had a top tax rate of 73%
then
The Revenue Act of 1924 also known as the Mellon tax bill cut federal tax rates and established the U.S. Board of Tax Appeals A parallel act, the Indian Citizenship Act of 1924 (43 Stat. 253, Ch. 233 (1924)), granted all non-citizen resident Indians citizenship
then
Revenue Act of 1926 reduced inheritance and personal income taxes, cancelled many excise imposts, eliminated the gift tax and ended public access to federal income tax returns. Passed by the 69th Congress, it was signed into law by President Calvin Coolidge.
They’ll raid the wallets of the very rich [which is fine with me, since I’m not very rich], but it’s never enough to finance their schemes. So as sure as night follows day, they’ll proceed to raid the wallets of the upper middle class, and then on to the wallets of the middle middle class. Haven’t we seen this play out before?
Bo-o-o-o-ring.
M J R – they bank on that being your attitude
and once they can wring money out of a billionaire..
what will they do to you?
take your life?
om on…
ok.. fine… but i am not a troll…
nor is 150 million people in the south of the US…
where the vernacular is.
but hey…
anytime i make people look ignorant
they want me to leave…
its an ego thing… i dont care, but they do!!!
lifetime of blowing the curve and watching people do this
ie. in one article biatch about how bad the press lies
and in another article, act as if the first isnt in there
and in a third, ignore the history changes over time
i been taking notes of this for about 13 years here now..
how bout you?
I wish that pollsters would ask this:
Since the top 1% pay 40% of the taxes, they have great political influence. To reduce the political influence of the rich, do you favor a more balanced tax regime?
how did Om on call Artfldgr a troll at 2:58, before artfldgr posted anything?
Artfldgr:
Learn how to communicate without insulting others and you may do better. Have you heard that before? Probably, have you learned? You may not be the smartest person on earth.
Artfldgr:
It’s y’all, honey. Bless your heart.
Solution is simple, if democrats want to pay more tax, Pelosi should propose a new law tomorrow that will make the tax rate for every registered democrat to be 90% while registered republicans will remain to have a tax rate according to current tax laws. Lets see how many democrats are left after that. If you want to pay more tax, then voluntarily pay more, no one is stopping you, don’t make laws to make people who don’t want more tax to pay more.
avi on February 4, 2019 at 4:25 pm at 4:25 pm said:
Yeah, I noticed that too. Good question!
.
Artfl, thanks for the additional info.
Avi and Julie:
I was reacting to an Artfldgr comment that contained some of the typical “you all” and “you guys” are ignorant etc. Which I can’t find in today’ posts or in yesterday’s, for example about the Death Angel mushrooms. It cold be an internet comment glitch or my mistake.
The tax data for tax year 2017 is essentially the same as the previous year per the Tax Foundations analysis. The left’s grasp of economics does not include an appreciation of where the capital comes from that funds the innovation that has blessed us with the wonders of the modern age. They have the hubris to believe that politicians are better at allocating this capital.
What should the tax be on law professors who make a million a year teaching one course?
om, thanks. I wondered if a comment of artfl’s had gotten lost.
om, avi, Julie:
I deleted the comment. I have rules about comments and how people interact with others here, and that comment violated them. I don’t always catch comments that do, but when I have the time to keep tabs I try to delete comments that do a lot of editorializing about how stupid people here are or how stupid I am. I have no problem with comments that point out errors of thinking or logic or facts on the part of any commenter or on my part. But that can be done without all the insults.
I suppose it would have helped if I had deleted om’s response, as well, because without the original comment from Art, om’s response would seem to make no sense.
I don’t think that most people would want to be punished for being successful. They should think about this more clearly.
Apparently, 76% of today’s Americans are fine with theft as long as they have the cover of the mob.
“Our Constitution was made only for a moral and religious people. It is wholly inadequate to the government of any other.” Founder John Adams
Neo, thanks for the explanation. You’re a mensch. (“Menschess”?)
It’s fine with me. When I started as a tax lawyer in 1977, the maximum marginal tax rate was 70%, which nobody paid. (70% x 0 < 28% x 1) Not until the Tax Reform Act of 1986, which substantially reduced deductions and tax shelters, did the rich pay taxes. (And boy, did they scream about it!) Forty-two years of experience tells me that if Fauxcohantas, Kamaladollading-dong and their friends succeed in getting a 70% maximum marginal rate, there will be plenty of loopholes built in the bill, enough to keep me busy for a long time.
My motto: "I don't care whether they raise 'em or lower 'em, just keep changin' 'em!"
Neo, I totally agree with you on the reason the Ten Commandments include a prohibition on “coveting”. I’ve often said that to others.
What I’ve also wanted to say to those rich who say they are fine with paying higher taxes is: “Go ahead! No one is stopping you from paying more than Uncle Sam says you owe.”
But, it would be a waste of my breath; because everyone knows they don’t really want to pay higher taxes. They just want the other rich folks to pay higher taxes; while looking good for saying it yet finding every loophole they can.
I found it interesting the part that Cordell Hull played in the Income Tax intro. The longest person to serve as Sect of State, under FDR.
Continuing from Richard Saunders’ remarks…
US political history shows fashions in what gets “horse traded” during the legislative process.
One era trades water projects, the next trades highway projects, and so forth.
In the era of very high marginal federal tax rates (which went well over 75% IIRC), the thing that was traded among legislators was tax breaks.
Now, the nice thing about tax breaks as a medium of exchange in the legislative corruption economy, is how easy they are to conceal (unlike, say, bridges to nowhere, or unused interstate sections). A few words in section 28.23, para. 12, line 6, and Bob’s Your Uncle. It’s trivial to write something that looks general-purpose, but actually applies to only one company, for instance. Who’s gonna see it except their corporate tax guy?
So really, the political (and some business) folks flogging high rates are mostly just advocating for a more corrupt government. Rent-seekers and grifters, the lot of them.
Flat tax (e.g. 17%) on all income (salary, interest, capital gains, etc, possibly including “employer paid” benefits). Only deductions would be for individuals (e.g. $7,000/person) and possibly a retirement account. Almost everyone would have skin in the game, then.
Let’s go all sophisticated and European. Tax the bottom half of the middle class (say, basic government clerks, elementary teachers, etc). at 20-25 percent, other groups proportionally. Let’s see how popular that is.
Roy in Nipomo on February 4, 2019 at 10:20 pm at 10:20 pm said:
Flat tax (e.g. 17%) on all income (salary, interest, capital gains, etc, possibly including “employer paid” benefits).
* * *
God (Jehovah) only asked for 10%.