Speaking of Lying…
Michele Bachmann (yes, I know) said this on a Sunday show this week:
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. … 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.
This is hardly new–in fact, I quote Bachmann mainly because the line she is using, its truthfulness notwithstanding, is virtually a cliché. It might go back even farther, but I remember the exact same sentiment (though the starting figure was a million dollars back then) being used to argue against higher taxes for the wealthy back in the 80’s and 90’s.
However, when right-wingers are trying to argue against tax increases for the rich, they complain that the wealthy are paying far too much in taxes already–not as a percent of their total actual income or wealth (because that starts to get embarrassing), but as a percentage of the total taxes paid. This was used throughout the Bush years to justify his tax cuts going mostly to the wealthiest Americans. Ironically, Bachmann only recently used this other cliché just a week and a half ago:
Well, remember, again, already the top 1 percent of income earners pay about 40 percent of all taxes into the federal government. So if you want to talk about fairness, the top 1 percent are paying 40 percent of all of the income.
Got that? The richest people are paying the biggest share of the taxes already, but if you increased their taxes to 100%, you could only fund the U.S. government for six months.
Now, I may not be a math whiz, but something doesn’t compute. Obviously some games are being played here with the numbers. The marginal tax rate for personal and corporate income is 35%, meaning that nobody should ever be paying more than a third of their income in federal taxes. The top 1% earn $410,000 and up, so people earning $250,000 and more are without doubt more than that top 1%, meaning that the $250,000+ group are supposedly paying more than 40% of the taxes. And Bachmann says that the $250,000+ group could only supply half of the country’s revenue even if we confiscated all of their money.
Answer me this: how can you be shouldering more than 40% of the taxes, but if you triple your tax rate, you’re only paying 50%?
Like I said, clearly she’s playing games–just like right-wingers always are, lying with numbers to get what they want. And, like I said, this is nothing new–I have been hearing variations on these claims for decades. When you want to raise taxes on the wealthy, they don’t have enough money to matter; but when they want to cut taxes for the wealthy, they pay the lion’s share already.
Part of this number-twisting is exposed here (the top 1% pay a total of 28.1% of federal revenues), despite the fact that the same top 1% possess about 40% of the nation’s wealth. It is reported that they also earn about 20% of the total income, but I do not know how much of that is hidden, sheltered, or otherwise not counted due to what tax laws allow.
However, even assuming that the top 1% earn about 20% of the income, that they shoulder about 28% of the burden does not sound incredibly oppressive.
Now, the right wing (and Bachmann in particular) love to whine about how 47% of the people pay no taxes at all–which, of course, is a lie, because most of them do pay non-income taxes–in fact, only 10% pay no federal taxes at all, and almost everybody pays taxes of some kind, especially sales taxes.
What the right-wingers neglect to mention why so many people don’t pay any federal income taxes: it’s because most of them don’t make enough money to get by in the first place.
However, Bachmann and the wingnuts will go on and on about how people in the middle class might actually get tax credits when they pay no taxes, but will blithely ignore corporations like GE getting billions in tax credits while paying 0% on massive profits.
No, this is about scapegoating, creating a villain they can use to help their patrons. They want people to believe that (1) the 47% is the liberal half of the country, and (2) they make lots of money but leech off the honest, hard-working, conservative (“real”) Americans.
Of course, if Bachmann were earning the average income of that 47%, I betcha anything she would be whining about how high her taxes are. Now, instead, Bachmann is actually implying that we should be taxing the poor more:
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.
“We need to broaden the base.” That can mean nothing other than raising taxes on the lower-middle class. At the same time when Republicans are clamoring for yet more massive tax cuts for the wealthy.
Wow.
At least she got the “federal income tax” part of the soundbyte right. Most Republicans just say 47% pay no taxes at all, which is blatant misinformation. I hesitate in calling it a deliberate lie, because it’s probably spoken without thinking (but if that were the case, then you could never accuse the Republicans of lying).
But I don’t even know if the statistic is true anyway. People pay income taxes all the time, or so I thought. True, many get a refund, but it’s usually not the same amount that was paid into, or at least that’s my impression. I honestly don’t know, but am I wrong about that?
but as a percentage of the total taxes paid. This was used throughout the Bush years to justify his tax cuts going mostly to the wealthiest Americans.
Well, it is true that the bottom 95% got $300B/yr tax cut and the top 5% got $80B.
So the tax cuts were slanted to the rich (they got bigger tax cuts in percentage terms, but the middle class got a big slice of the tax cut cake to pay us off).
“We need to broaden the base.” That can mean nothing other than raising taxes on the lower-middle class. At the same time when Republicans are clamoring for yet more massive tax cuts for the wealthy.
I’m beginning to think the crazy caucus of the Republican party is beginning to overstay their welcome already. We’ll see.
As for the math, she may be looking at the spending side, not revenue side. 2011 fed spending is going to be $3.8T, so “6 months” of that would be ~$2T.
Total personal income now is $12.7T. The $250,000 income level is around the top 1.5% of households and they’re bringing in 20% of the national income, roughly.
So 20% of $12.7T would be $2.5T, so 100% confiscatory taxation would be 8 months and not 6 months of revenue.
It is true we need to broaden the base if we want to keep spending nearly $4T/yr on federal government.
Japanese citizens like you shouldn’t be throwing stones about not paying enough taxes : )