The charts from the NYT’s are irrefutable, showing a shocking change in how much taxes have been cut on the rich over the past 70 years so now the middle class pay a higher rate than the rich.
The Tax Rate on the Rich is Now Lower than On the Middle Class
There is a phrase, a picture tells a thousand words. The graphs that follow the quote below do precisely that….and more.
Almost a decade ago, Warren Buffett made a claim that would become famous. He said that he paid a lower tax rate than his secretary, thanks to the many loopholes and deductions that benefit the wealthy.
His claim sparked a debate about the fairness of the tax system. In the end, the expert consensus was that, whatever Buffett’s specific situation, most wealthy Americans did not actually pay a lower tax rate than the middle class. “Is it the norm?” the fact-checking outfit Politifact asked. “No.”
Time for an update: It’s the norm now. “NY Times: The Rich Really Do Pay Lower Taxes Than You
Tax Rate in 1950 by Income Group
Each succeeding chart shows the rates at which we tax each income bracket. The most obvious trend is the inexorable decline in taxes on the wealthiest Americans, but you will also note a significant increase in taxes imposed on the poor and working poor. Keep in mind, the poorest Americans paid only 15% in taxes in 1950 and pay 25% now. When you are earning $10/hour, working two jobs that 66% increase is punitive.
The neo-liberal argument has been that reducing taxes will circulate more money into the economy and increase private investment. The unspoken consequence is the gutting of our government’s ability to invest in us.
Instead we get the private investment promised from tax cuts, private investment in anything that turns a quick profit or results greater shareholder returns, instead of a health system, an infrastructure, a transition to renewables, a strong public education system, and anything else that might actually benefit the rest of us. How is this tax policy working for you?
Tax Rate in 1961 by Income Group
It is important to note that this shift in policy has occurred under EVERY administration, no matter who is President or who is the majority in Congress. There are no heroes here.
Tax Rate in 1980 by Income Group
Reagan was the King of Tax cuts and the inventor of “trickle down” economics, but the continued erosion of our tax base through various tax incentives, cuts and other 1% and corporate giveaways continued through Bush, Clinton, Bush, and Obama until Trump …..
Tax Rate in 2018 Income Group
From the NY Times:
By the middle of the 20th century, the high-tax advocates had prevailed. The United States had arguably the world’s most progressive tax code, with a top income-tax rate of 91 percent and a corporate tax rate above 50 percent.NY Times: The Rich Really Do Pay Lower Taxes Than You
But the second half of the 20th century was mostly a victory for the low-tax side. Companies found ways to take more deductions and dodge taxes. Politicians cut every tax that fell heavily on the wealthy: high-end income taxes, investment taxes, the estate tax and the corporate tax. The justification for doing so was usually that the economy as a whole would benefit.
The justification turned out to be wrong. The wealthy, and only the wealthy, have done fantastically well over the last several decades. G.D.P. growth has been disappointing, and middle-class income growth even worse.
The American economy just doesn’t function very well when tax rates on the rich are low and inequality is sky high. It was true in the lead-up to the Great Depression, and it’s been true recently. Which means that raising high-end taxes isn’t about punishing the rich (who, by the way, will still be rich). It’s about creating an economy that works better for the vast majority of Americans. “
Click here to review the full NY Times piece. Click here to read an article debunking the myth that tax cuts generate economic growth. And while the neo-liberals all presume that economic growth is good, ponder whether it isn’t time to stop producing more of most everything we don’t need.
The Impact of the Gutting a Once Just Tax Policy
You have to wonder how for the last 70 years, American voters have supported Presidents and Congresses that have systematically crafted policy that has eroded any sense of justice to our tax policy.
This has been an entirely bipartisan effort with Democrats only rarely summoning the courage to face down their major donors and do what is right for the American public.
Tax policy and budgets are both moral documents. They capture very precisely the values driving policy. Over the past 70 years, we have abandoned our infrastructure and unraveled our social safety net, leaving tens of millions of Americans inexcusably vulnerable. When we had a choice to bail out banks or the millions of Americans who had lost their homes, Democratic leadership chose the banks.
Where does it end? Your thoughts? But before you comment below, take a look at this most revealing video. It shows the impact that our tax policy has had feathered the nest of the 1%. It will come as no surprise that the wealthy have accumulated obscene levels of wealth, while the middle class has gained nothing and the working poor and the poor have been utterly decimated.
In solidarity, Paul & Roxanne
Hi Roxanne and Paul. The combination of the two aspects of this post is terrifyingly revealing. There are takers, givers and enablers. As the shakedown of the unwashed masses intensifies, the compression of wealth and power filters out nearly all of the so-called striving or competition so heralded in the iconography of the propagandists. I viciously disagree with the assumption that many of the takers work really hard and ‘earn’ their preposterous cache of wealth, if that is what you can even call it.
The cornerstone of capitalism is the use of wealth itself to create even more wealth. There is no product or service put forth, only more or less wealth acquired as the result of casino gambling on many fronts. That monetized wealth does, however, come from somewhere. There is an old adage that ‘all wealth comes from labor.’ That is still true. But the cost of labor has shrunken in opposition to the amount of wealth created. This occurs by constantly re-assessing the value of ‘things’ upward or downward. Fixed assets are valued upward, while fluid assets are squeezed. Labor is a fluid asset. Throw in technology, which reduces the size of labor’s contribution in relation to the constant re-assessment of the monetized value of things, and you end up with the hockey stick of the graph.
Enter the enablers, of which MLG is but one of a dwindling handful. Look at OandG. It is a massively subsidized monopoly, all of that gifted welfare coming from the taxes paid by the shrinking pile of cash generated by the workforce. Their range of valued deductions is now so paltry that the only things worthy of deducting are the most weighted expenses any person has to keep on working – taxes on what I must buy to live, from my taxed income toward my taxed purchasing of disposable things I must have to make it to work so I can stay alive. And contribute my labor, which is now worth less, so the owner/manager/investor class can become more obese each day.
Now the enabler, who is recruited to get more from the workforce for less, while enabling the monetized cabal to further extract wealth from the citizenry, steps forward to proclaim that the path forward through the thorns to the stars comes with the price of misery and eventual death, but throughout the dying process more mouths will be better fed, and youth will be better indoctrinated, and roads to perdition will be newly paved, and the promise of a brighter future will be illuminated by lighting from renewable oligarchs, powering 5G pleasantries through the eyes and ears into the brains of the addicted hopeful, who are not really hopeful at all, but have adopted the quid pro quo of ‘you scratch my back and I’ll scratch yours.’ What are the logical mechanisms available that will ensure parity in that deal?
I am a biologist. There is an entire group of living beings that constantly robs Peter to pay Paul, while relentlessly stuffing away a portion of the loot under the mattress. They are known as parasites. And all of us know where this is heading. Your charts reveal the massive imbalance of a diseased society. If you knew you had worms in your gut, would you leave them there?
Mr Nickel is always right on!
MLG sold us out, she has even shortchanged the children. She chose to remain silent about the crimes and depredations of her predecessors. 30 years of Neoliberal policies, directed at the children, the educational system, and child welfare, created a generational problem which they are still trying to spin, to justify “investments” in more law enforcement, instead of education.
The Oil and Gas Industry, fully exploited the ignorance, poverty, and corruption, in this state. They cheered on former governor Martinez’s, corrupt regime. Their control at the federal level, with pre-emptive “laws” meant to protect the industry from any regulation, or scrutiny have what was left of our democracy.
The Energy Policy Act of 2005 is just one example of the protections given to Oil and Gas.
“The bill exempted fluids used in the natural gas extraction process of hydraulic fracturing (fracking) from protections under the Clean Air Act, Clean Water Act, Safe Drinking Water Act, and CERCLA (“Superfund”).”
“it exempts oil and gas producers from certain requirements of the Safe Drinking Water Act;”
The Bill also contained significant tax reductions for oil and gas.
“The bill exempted fluids used in the natural gas extraction process of hydraulic fracturing (fracking) from protections under the Clean Air Act, Clean Water Act, Safe Drinking Water Act, and CERCLA. It created a loophole that exempts companies drilling for natural gas from disclosing the chemicals involved in fracking operations that would normally be required under federal clean water laws. See Exemptions for hydraulic fracturing under United States federal law. This exclusion has been called the “Halliburton Loophole”. Halliburton is the world’s largest provider of hydraulic fracturing services. The measure was a response to a recommendation from the Energy Task Force, chaired by Vice President Dick Cheney in 2001. (Cheney had been Chairman and CEO of Halliburton from 1995 to 2000.)”
Check this out, an article from The Guardian– 20 polluters account for one third of all greenhouse emissions.
Check this out!
“Compared with carbon dioxide, methane has a shorter lifetime in the atmosphere but is better at trapping radiation, so methane’s impact is more than 25 times greater than that of carbon dioxide over a 100-year period, according to the U.S. Environmental Protection Agency.”
We are in for a wild ride, the Methane from the permafrost and the ocean deposits are going to be released, making the New Mexico Hot Spot look like an afterthought.
And that chart showing the minuscule portion of wealth most of the US citizens have as opposed to the sharks at the top was created in 2009, ten years ago. Way before tRump. With his hideous tax schemes, the situation is even worse than that appalling chart.
And of course Mr BoughtNPaidFor has now decimated the regulations his RichBeyondTheDreamsOfAvarice handlers wanted decimated, leaving us with feeble protection for our air, water, wildlife, etc.
Hi Paul and Roxanne,
I think the Governor has been very clear about who her staff “work for”. It is shocking, and I think we need to hold her accountable here. I’ve been passing around New Energy Economy’s postcards, asking the Governor to include Community Solar on the 2020 legislative agenda, so we’ve got around 15 people weighing in, plus ourselves. Hopefully, others will do similarly and call Governor Lujan Grisham, Senator Wirth and Speaker Egolf. We need to keep up the pressure.
Among the things I said to the Governor is that if, like us, she has children, grandchildren, family and friends who may not be able to survive beyond 100 years from now, this reality trumps all other concerns. Why educate young people who will die because we have destroyed life on earth, including our own.
One can be polite, but firm. Extinction Rebellion is also posting daily about their work in the UK and many other locations around the world. I recommend following their posts, as well.
I have a stack of Extinction Rebellion stuff to read tomorrow.
She is an old democrat, conservative as they come.
So, the question is what do we do with all this incredible good and important knowledge above and in every page of retake????