Tuesday, September 18, 2012

Romney's 47%

According to a video tape smuggled out of a fund raiser, Mitt Romney claims that 47% of Americans pay no income tax and consider themselves “victims.” He went on to say that's he's not worried about them.

Here's reality. Let's focus purely on income taxes because that is the largest share of federal revenue, it's what most people view as taking the biggest bite out of their paycheck and it's what Romney was talking about.

Typically income and tax information is provided in quintiles each of which represents 20% of the population. According to the CBO, the bottom two quintiles, that's 40% of the households in the US, have negative income tax. In other words they actually get money rather than pay. If your gross family income is less than $38,000, you are most likely in one of these two quintiles.

The next quintile, income up to $62,000, pays 2.7% of the income taxes. The fourth quintile, up to about $102,000, pays 13.4%. The top 20% pays 94.1% of the income tax. The top 5%, income greater than $186,000, pays 63.9% of all income taxes.

So now you know where you are and how much tax burden your group shoulders. The issue is not with the tax laws. It's with the ungodly unfair distribution of income that has occurred since 1980. In 1981, with very similar tax tables, no quintile had a negative tax burden and the top quintile paid 64% of all income taxes compared with 94% today.

Romney is basically calling 47% of the population freeloaders based purely on income tax. Of course he ignores the Social Security payroll tax and the Medicare payments and the various sales taxes which everyone pays. If you work, then you're paying for Social Security and Medicare. They're not freebies.

Now for all you people whining about how you're supporting all those freeloaders. I'm in the top 5%, which pays 63.9% of all income taxes, so it's most likely, according to Romney's way of thinking, that I'm supporting YOU so welcome to the freeloaders club.

The Right Wing myth that has been sold to working class white Americans is they’re working to support a bunch of shiftless lazy bums at the bottom of the economic ladder. The reality is that everyone pitches in what he can. If it’s not through income tax it’s through the payroll tax and sales taxes.

It is a form of “from each according to their ability and to each according to their need.” The irony is that the folks that complain the loudest about supporting welfare cheats are actually themselves being supported by those making more money and those folks generally aren’t complaining about taxes. They’re too comfortable to complain.

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