Nutjobs Ranting About Politics.

[taxwonk]

Originally posted by sgtclub
Why do you not look at the burden side as well?

Please explain how looking at the burden side will further an examination of who benefits most from tax cuts?

[taxwonk]

Originally posted by bilmore
I note that you like to discuss these issues in terms that do not readily reveal what your numbers really mean. Thus, you don't like to see that your hated rich pay almost three quarters of all taxes paid in this country. It's safer - less revealing - to use your "more accurate" statistic that can be recited in a vacuum.

There simply isn't all that much tax left to cut in the lower groups. When the top earners are already made to shoulder the vast majority of the burden, of course any cut is going to fall to their benefit.

I don't hate the rich; according to the SOI, I'm one of them. You can point out all you want how the rich pay most of the taxes in this country. That won't erase the fact that the Bush tax cuts, which were sold as middle-class tax relief, didn't relieve the tax burden of the middle class.

[taxwonk]

Originally posted by bilmore
I note that you like to discuss these issues in terms that do not readily reveal what your numbers really mean. Thus, you don't like to see that your hated rich pay almost three quarters of all taxes paid in this country. It's safer - less revealing - to use your "more accurate" statistic that can be recited in a vacuum.

There simply isn't all that much tax left to cut in the lower groups. When the top earners are already made to shoulder the vast majority of the burden, of course any cut is going to fall to their benefit.

I went back and looked up the facts. I found the following information:

• For 2001, the
  returns in the top 1 percentile reported 17.5 percent
  of total AGI and 33.9 percent of income tax . The
  amount of AGI needed for inclusion in this percentile
  group (i.e., the AGI floor) was $292,913. For 2000,
  the returns in this percentile group (i.e., those with at
  least $313,469 in AGI) reported 20.8 percent of total
  AGI and 37.4 percent of income tax generated. The
  fall in both the share of AGI and income tax for the
  top 1 percentile, and corresponding increase in the
  average tax rate, was largely attributable to the
  reduction in net capital gains (less losses) for these
  taxpayers. This was the first time that the share of
  AGI and income tax for returns in the top 1 percentile
  fell since 1993 and 1994, respectively.
  For 2001, the returns in the top 5-percentile group
  (returns reporting AGI of $127,904 or more) reported
  32.0 percent of total AGI and 53.3 percent of income
  tax, less than the 35.3 percent and 56.5 percent,
  respectively, for 2000 (when the AGI floor was
  $128,336).

The greatest percentage of the tax burden was actually generated at the lower brackets:

• more tax was generated
  for 2001 at the 15-percent rate than at any other rate.
  The 54.4 percent of income taxed at this rate was
  reported by 95.3 percent of returns with taxable
  income, generating 37.6 percent of tax generated.
  The 27.5-percent rate generated the next largest
  amount of income tax liability. Tax in that bracket
  was reported on 32.1 percent of returns, and 19.4
  percent of modified taxable income was taxed at this
  rate, to generate 24.6 percent of tax generated.

Admittedly, a portion of the tax paid at the lower brackets was paid by taxpayers whose marginal tax rate was in higher brackets. But, on a comparative basis, it demonstrates that it is at lower to middle income levels that the greatest share of tax is generated.

But don't believe me. Read it for yourself in this article from the IRS Statistics of Income Bulletin.

[Mmmm, Burger (C.J.)]

Originally posted by taxwonk
As I noted a few days ago, looking at the total share of taxes doesn't really measure the disparity in the tax cuts. You have to compare effective tax rates. The top 1% of filers enjoyed a 6% drop in their effective tax rate. The middle class got less than 1%.

No, and as I noted, looking at the drop in effective tax rates also fails to tell the whole story. You can't take a can out of an empty cupboard.

[bilmore]

Originally posted by taxwonk
Read it for yourself in this article from the IRS Statistics of Income Bulletin.

All by itself, this statement should be considered a hate crime.

[Mmmm, Burger (C.J.)]

Originally posted by taxwonk


Admittedly, a portion of the tax paid at the lower brackets was paid by taxpayers whose marginal tax rate was in higher brackets. But, on a comparative basis, it demonstrates that it is at lower to middle income levels that the greatest share of tax is generated.

Perhaps I'm misunderstanding what you're saying, but it seems to be entirely misleading. Everyone pays taxes at the lower brackets; only some people pay taxes at the higher brackets. So of course, those first few dollars of income are going to supply a good chunk of tax revenue. But that doesn't mean it's all coming from poor people; it's coming from everyone who actually earns money. And then the IRS goes back and takes even more from people earning even more.

Worse, the notes about the changes in 2001 undermine your argument-. If the reason the rich are paying less is because k-gains went down, then that has nothign to do with tax rate policy, and everything to do with how people are earning money, and how much.

[taxwonk]

Originally posted by bilmore
All by itself, this statement should be considered a hate crime.

Which is why I did the legwork for you. And all your fellow travelers who have simply assumed that the rich pay all the taxes and everybody else gets a free ride.

[bilmore]

Originally posted by taxwonk
Which is why I did the legwork for you. And all your fellow travelers who have simply assumed that the rich pay all the taxes and everybody else gets a free ride.

(Caveat: I became a lawyer to avoid math.)

I don't think your cite says what you think it says.

(ETA: See Burger, supra.)

[taxwonk]

Originally posted by Mmmm, Burger (C.J.)
Perhaps I'm misunderstanding what you're saying, but it seems to be entirely misleading. Everyone pays taxes at the lower brackets; only some people pay taxes at the higher brackets. So of course, those first few dollars of income are going to supply a good chunk of tax revenue. But that doesn't mean it's all coming from poor people; it's coming from everyone who actually earns money. And then the IRS goes back and takes even more from people earning even more.

Worse, the notes about the changes in 2001 undermine your argument-. If the reason the rich are paying less is because k-gains went down, then that has nothign to do with tax rate policy, and everything to do with how people are earning money, and how much.

First, what I'm saying is that 62.2% of total tax paid is generated at the 15% and the 27.5% tax bracket. The top 5% of taxpayers pay 53.3% of total tax. This was simply in response to the argument that the wealthy pay all the taxes, and that their tax burden falls entirely on the wealth they have that none of the rest of the po' folk have.

Second, if you read the quote more carefully, you'll see that it's corrected to take into account capital losses. The drop is attributable to a lower capital gains tax rate.

[bilmore]

(Editorial addition: Hee hee hee hee . . . .)

[Mmmm, Burger (C.J.)]

Originally posted by taxwonk
The top 5% of taxpayers pay 53.3% of total tax.

Touché.

Second, if you read the quote more carefully, you'll see that it's corrected to take into account capital losses. The drop is attributable to a lower capital gains tax rate.

here's the quote I read:

• The fall in both the share of AGI and income tax for the top 1 percentile, and corresponding increase in the average tax rate, was largely attributable to the reduction in net capital gains (less losses) for these taxpayers.

there's no mention there that this results from a lower rate--is it in the IRS pub? Certainly it would not surprise me if k-gains went down in 2001. No bull market and lots of post-2000 losses to offset any gains. (if it's somewhere in teh IRS report, fine, but I don't have time to read 78 pages now to find your source; I did have time, however, to note that from 2000 to 2001, the average tax rate declined for all income brackets, except the top one (see last line of chart, page 5).

edited to fix margins -- t.s.

[bilmore]

Originally posted by taxwonk
The top 5% of taxpayers pay 53.3% of total tax.

Effin' slackers.

[Not Me]

Originally posted by bilmore

(Editorial addition: Hee hee hee hee . . . .)

But is it accurate? Are the Krauts sad to see us go?

[Tyrone Slothrop]

Originally posted by Not Me
But is it accurate? Are the Krauts sad to see us go?

The point of the cartoon was self-congratulation, not accuracy.

[bilmore]

Originally posted by Tyrone Slothrop
The point of the cartoon was self-congratulation, not accuracy.

No, it was based on the reaction of the biggest trade union in Germany - which has spent the past year decrying us as warmongers, and has urged its membership to partake in the anti-American protests, but now, in the past few days, is suddenly aghast that they might lose jobs when we pull our troops.

(From this decent English-language German blog.)