47gate: The Myth of Progressive TaxesPosted: September 19, 2012
Much of the chatter about Mitt Romney’s now infamous half-the-country-can-go-fuck-itself video has focused on that 47 percent who in Romney’s words “are dependent upon government, who believe that they are victims…who pay no income tax.” It was this armchair analysis that inspired Romney to conclude in words that may someday grace the tombstone of his presidential bid: “my job is not to worry about those people.”
In the wake of this latest outbreak of Mittastatic cancer of the campaign voicebox much is being said about who actually comprises that 47 percent, and about Romney’s seemingly fundamental misunderstanding of the nature of tax obligation. This, in turn, predictably elicits the usual whining from the right about how wealthy taxpayers supposedly pay way more than their fair share of taxes.
At a time like this it’s worth reminding ourselves that our tax system isn’t really terribly progressive. A good way to judge is to look at the income people in particular brackets earn and compare it with the tax revenue that comes out of those same brackets. If lower income people pay a much smaller proportion of taxes compared to the proportion of income they earn, and if higher income people pay a much larger proportion of aggregate taxes than they earn, then we have a highly progressive system. So what does it actually look like?
The chart below, from The Atlantic based on data compiled by Citizens for Tax Justice, answers the question. Blue bars (income) are a bit bigger than red bars (taxes) at lower incomes, while red bars are slightly bigger than blue bars at higher incomes. In other words, very modest progressivity. Or as The Atlantic‘s economics writer Matthew O’Brien aptly puts it, “If this is Marxism, it’s very carefully disguised.”
A version of this post appears on the Nashville Scene‘s Pith in the Wind blog.