http://www.marketwatch.com/story/45-of-americans-pay-no-federal-income-tax-2016-02-24

An estimated 45.3% of American households — roughly 77.5 million — will pay no federal individual income tax, according to data for the 2015 tax year from the Tax Policy Center, a nonpartisan Washington-based research group.

Despite the fact that rich people paying little in the way of income taxes makes plenty of headlines, this is the exception to the rule: The top 1% of taxpayers pay a higher effective income-tax rate than any other group (around 23%, according to a report released by the Tax Policy Center in 2014) — nearly seven times higher than those in the bottom 50%.

Meanwhile, the richest 20% of Americans, by far, pay the most in income taxes, forking over nearly 87% of all the income tax collected by Uncle Sam.

So what's the myth you are referring to? We have a progressive income tax system so this is exactly what you would expect. These figures do nothing to get at the issue of tax loopholes and shelters that are used, or sometimes abused, to avoid taxes. That issue obviously becomes more significant as taxable income increases because the stakes get much larger. You'd need to dig deeper than this simple summary information to identify where the problems are.

The myth I am referring to is that "the rich" don't pay taxes, you even allude to that myth in your response.

The myth I am referring to is that "the rich" don't pay taxes, you even allude to that myth in your response.

Actually I don't. I recognize that in a progressive tax system people with higher incomes pay higher taxes, and the figures you posted bear that out. I don't know too many people who would argue that point so I'm not sure what the "myth" is.

I am saying that aggregate numbers like you provided tell us nothing about abuses in the tax system.

http://www.marketwatch.com/story/45-of-americans-pay-no-federal-income-tax-2016-02-24

On paper I am a millionaire, but in reality it is so far from the truth.

On paper I am a millionaire, but in reality it is so far from the truth.

Unfortunately the IRS only cares how you look on paper.

Progressivity has been pushed so far that the bulk of our tax revenues are now balanced on a small portion of the population. That sliver - the wealthy - often have highly variable income year-to-year as markets change. A large market adjustment downward craters tax collections, as we saw in 2007-2010.

Everyone should be exposed to the burden of citizenship, and pay something. Progressivity has gone way to far in the pursuit of voting blocks. We're paying a price for that, and likely will pay a worse one in the future. But the politicians pandering to that could care less as long as their power is preserved.

Progressivity has been pushed so far that the bulk of our tax revenues are now balanced on a small portion of the population. That sliver - the wealthy - often have highly variable income year-to-year as markets change. A large market adjustment downward craters tax collections, as we saw in 2007-2010.

Everyone should be exposed to the burden of citizenship, and pay something. Progressivity has gone way to far in the pursuit of voting blocks. We're paying a price for that, and likely will pay a worse one in the future. But the politicians pandering to that could care less as long as their power is preserved.

That's crap, IMO. Even marginal middle class families and individuals still pay significant income taxes and even more in payroll taxes, but you make it sound like only "the wealthy" pay taxes.

Marginal rates for the highest earners are near a 50 year low. If it seems like there is an increasing tax burden on the wealthy it is most likely due to a shrinking middle class. If the working class is not keeping up on income they are also going to lag behind on income taxes paid and a higher proportional amount will be paid by those making the big dollars. This doesn't necessarily mean high earners are overtaxed. It could simply be that in the current economy the working class are not earning the proportion of total national taxable income that they historically have.

This is a bit long but interesting read.

Neoliberalism vs. New Deal: Bernie, Hillary and what’s really at stake in this primary

Democrats aren't just picking a candidate. They're choosing their party's economic course for a generation to come

THOMAS L. PALLEY, THE GLOBALIST

This article originally appeared on The Globalist.
TheGlobalist Thirty years of accumulated anger with neoliberalism — which has downsized many Americans’ incomes and hopes — has had a profound effect on the 2016 U.S. Presidential election. The insiders are either out or on the ropes.

Though the Republican rebellion has been more clear-cut in its dismissal of insider candidates, it is Bernie Sanders’ Democratic rebellion that is of potentially far greater historic significance.

The Republican uprising has undoubtedly exhibited greater anger. If Donald Trump or Ted Cruz triumph in the November general election, they threaten an uglier more intolerant politics that could even become tinged with American black-shirtism (or “white nationalism”).

However, absent the darkest of outcomes, the Republican rebellion is of less lasting political significance for two reasons.

First, it does not fundamentally challenge the neoliberal economic model that is the root cause of popular anger on all sides. Whether this anger manifests itself in nationalism, racism, evangelism and/or cultural atavism, these are ultimately all expressions of the scapegoat itch.

They do not challenge Corporate America’s and Wall Street’s domination which sustains neoliberalism.

Second, and more importantly, the Republican rebellion does not change the party’s pre-existing political trajectory and relies on electoral forces that are peaking out.

That contrasts with Sanders’ Democratic rebellion which explicitly challenges the neoliberal economic model. His campaign is also about defining the political character of the coming Democratic electoral majority.

Viewed in this light, the Republican rebellion is an eruption from an angry electoral base whose political power is actually waning, which makes them all the more frustrated and mad. In contrast, the Democratic rebellion is an eruption from a rising base whose political agenda awaits definition.

A LOGICAL EXTENSION OF REPUBLICAN POLITICS
The Republican elite has been profoundly taken aback by the dismissal of Crown Prince Jeb Bush and the Boy Scout Senator Marco Rubio. Even so, both Trump and Cruz represent a logical extension of Republican politics — rather than a break.

Long ago, Richard Nixon unleashed the politics of hate with his “southern strategy”, aimed at exploiting animosity toward President Johnson’s civil rights legislation to convert the South (i.e., the Confederacy) from Democrat to Republican.

In their respective campaigns, Trump and Cruz have articulated a level of racism and xenophobia which the Republican establishment is strategically uncomfortable with. The two have towed the line on tax cuts for the rich, and Cruz stayed in line on trade until Trump started making hay with the issue.

Despite Cruz’s odious personality, the Republican establishment prefers him as he has been more orthodox on trade and Social Security, while Trump is also loathed for humiliating Jeb Bush with his taunt of “low energy.”

That said, if Trump wins the nomination, a rapprochement is likely. For the Republican establishment, tax cuts and preserving neoliberal globalization are preeminent. Trump is an opportunistic businessman who trumpets deal-making.

ACCELERATING REPUBLICANS’ DEMOGRAPHIC DESTINY
The rise of Trump and Cruz has merely accelerated Republicans’ date with demographic destiny. The party of dog whistle racism and immigrant bashing long faced a difficult future because of demographic trends making minorities an increasing share of the electorate.

Republicans hoped to postpone that difficult future by a combination of voter suppression policies (e.g., making voter registration difficult; reducing polling booth access; and excluding minority voters via “new Jim Crow” laws denying voting rights to convicted felons) and gerrymandering congressional districts in states like Texas, Wisconsin and Michigan.

That has already given Republicans control of the House of Representatives, despite receiving far fewer total votes at a national level.

The undemocratic construction of the U.S. constitution, which gives two Senate seats to both small states like Wyoming (population 580,000) and large states like California (population 38.5 million), also means Republicans have remained competitive in the Senate.

That is because of their relative strength in the comparatively under-populated interior states.

These features could delay electoral developments, but the prognosis was always an outlook in which Republicans were going to be increasingly uncompetitive nationally. Trump’s and Cruz’s hate politics has simply accelerated and cemented that prognosis.

WALL STREET: DEMOCRATS FOR SALE?
That electoral prospect implies Republicans can no longer reliably deliver for Corporate America and Wall Street, which means Corporate America and Wall Street need to find another sure political partner. Therein lies the greater significance of the Sanders/Clinton contest.

Over the last 30 years, Wall Street has had little difficulty working with and funding Democrats, and the Clintons have been especially cooperative.

For many years, Goldman Sachs has been happy to split its political contributions, sending 55% to the Republicans and 45% to the Democrats. Now, Goldman can make a small recalibration and send a little bit more to the Democrats.

If Hillary Clinton wins, the Democratic Party will remain squarely within the orbit of Wall Street and Corporate America.

The Democrats will become the ruling party, but their rule will substantially continue what we have had, perhaps supplemented by an extra spoonful of compassionate economic policy.

If Sanders wins, there is a chance the Democratic Party can rediscover its modern roots of New Deal social democracy via expanded Social Security, single payer health insurance, debt-free college, the end of neoliberal trade policies and reining in of corporate power.

THE DEMOCRATS FACE A REAL CHOICE
The 2016 primary elections will significantly influence the Democrats’ political course for the next generation. Demographics imply Democrats will be the majority of the future, but the party’s political identity and agenda is up for grabs.

If the Clinton vision prevails, the Democratic Party stands to become a party of neoliberal economics, wrapped in socially liberal identity politics. A Clinton-led Democratic Party will also continue President Obama’s tactical appeals to “bi-partisanship”.

The goal would be to enlist moderate upper-middle class Republican-leaning professionals into a corporate controlled Democratic Party franchise.

If the Sanders vision prevails, the Democrats will pivot toward their New Deal social democratic roots. In that case, economic solidarity and inclusion become the headline.

Under those circumstances, the Democratic Party would once again aspire to be a mass movement — rather than continue what it currently is: an awkward stitching together of corporate money, social liberals and minority voters.

THE CURSE OF MONEY
However, as long as unlimited money is allowed in politics, there is a perennial danger of a backdoor Wall Street takeover. That is because a New Deal Democratic Party would still need money to compete in elections. That leaves an opening for Corporate America and Wall Street to take back control.

That is why limits on money contributions and repealing the Citizens United court decision are so important. It also explains why Sanders has made that the central focus of his political revolution, while Clinton has persistently sought to diminish the issue.

The myth I am referring to is that "the rich" don't pay taxes, you even allude to that myth in your response.

I think the oft-quoted phrase is not that the rich don't pay taxes, it's that they don't pay their "fair share." Highly debatable.

Marginal rates for the highest earners are near a 50 year low. If it seems like there is an increasing tax burden on the wealthy it is most likely due to a shrinking middle class. If the working class is not keeping up on income they are also going to lag behind on income taxes paid and a higher proportional amount will be paid by those making the big dollars. This doesn't necessarily mean high earners are overtaxed. It could simply be that in the current economy the working class are not earning the proportion of total national taxable income that they historically have.

What do you consider "over taxed?" High wage earners in some states surrender close to 60% of their income when all is said and done. Specifically, what percentage would you consider excessive?

[Edited on 4/19/2016 by alloak41]

What do you consider "over taxed?" High wage earners in some states surrender close to 60% of their income when all is said and done. Specifically, what percentage would you consider excessive?

I don't have a specific answer for that. I suppose when you get to the right of the maximum on the Laffer Curve the rate is excessive. Maybe it's excessive before you get to the peak. It depends on your definition of excessive.

BTW, it is not only high wage earners who are paying half or more of their earnings in taxes. Anyone who owns a home, owns a car, buys gas, has a telephone, cable TV, buys stuff in a store or online, eats out once in a while, etc. is paying much more tax than they probably realize. Is it too much? I don't know.

But I do know that we have a disappearing middle class, or as Bernie would say, income inequality. Generally speaking, the income growth enjoyed by the highest earners has not been realized by low and middle income earners. This in itself will result in a higher percentage of taxes paid by the high earners. I don't know what has caused this. Some say it's corporate greed. I'm not sure if the tax code plays a role in growing income gap or if it can be used to correct for it. But I have no doubt that the phenomenon exists. Here's a link that supports this claim:

http://www.bankrate.com/finance/economics/income-gap-widening-1.aspx

I'm sure you can find links that support the claim that a widening income gap is a myth. Or maybe links that claim lowering taxes on the highest earners would benefit the lowest earners. On issues like this people always find the resource that supports their pre-existing position. I'm not looking to argue the point. I'm just stating my position. Others will disagree. No one is likely to have their mind changed in an internet forum.

What do you consider "over taxed?" High wage earners in some states surrender close to 60% of their income when all is said and done. Specifically, what percentage would you consider excessive?

I don't have a specific answer for that. I suppose when you get to the right of the maximum on the Laffer Curve the rate is excessive. Maybe it's excessive before you get to the peak. It depends on your definition of excessive.

BTW, it is not only high wage earners who are paying half or more of their earnings in taxes. Anyone who owns a home, owns a car, buys gas, has a telephone, cable TV, buys stuff in a store or online, eats out once in a while, etc. is paying much more tax than they probably realize. Is it too much? I don't know.

But I do know that we have a disappearing middle class, or as Bernie would say, income inequality. Generally speaking, the income growth enjoyed by the highest earners has not been realized by low and middle income earners. This in itself will result in a higher percentage of taxes paid by the high earners. I don't know what has caused this. Some say it's corporate greed. I'm not sure if the tax code plays a role in growing income gap or if it can be used to correct for it. But I have no doubt that the phenomenon exists. Here's a link that supports this claim:

http://www.bankrate.com/finance/economics/income-gap-widening-1.aspx

I'm sure you can find links that support the claim that a widening income gap is a myth. Or maybe links that claim lowering taxes on the highest earners would benefit the lowest earners. On issues like this people always find the resource that supports their pre-existing position. I'm not looking to argue the point. I'm just stating my position. Others will disagree. No one is likely to have their mind changed in an internet forum.

I arrive at a figure easily, based solely from a moral standpoint. EVERY taxpayer should be permitted to keep more than half their income. Forty-five percent total, max. Leave it up to the States, Feds, and localities to arrive at that figure. Forcing a citizen to surrender more than half their income is legalized extortion. Just one man's opinion...

What do you consider "over taxed?" High wage earners in some states surrender close to 60% of their income when all is said and done. Specifically, what percentage would you consider excessive?

I don't have a specific answer for that. I suppose when you get to the right of the maximum on the Laffer Curve the rate is excessive. Maybe it's excessive before you get to the peak. It depends on your definition of excessive.

BTW, it is not only high wage earners who are paying half or more of their earnings in taxes. Anyone who owns a home, owns a car, buys gas, has a telephone, cable TV, buys stuff in a store or online, eats out once in a while, etc. is paying much more tax than they probably realize. Is it too much? I don't know.

But I do know that we have a disappearing middle class, or as Bernie would say, income inequality. Generally speaking, the income growth enjoyed by the highest earners has not been realized by low and middle income earners. This in itself will result in a higher percentage of taxes paid by the high earners. I don't know what has caused this. Some say it's corporate greed. I'm not sure if the tax code plays a role in growing income gap or if it can be used to correct for it. But I have no doubt that the phenomenon exists. Here's a link that supports this claim:

http://www.bankrate.com/finance/economics/income-gap-widening-1.aspx

I'm sure you can find links that support the claim that a widening income gap is a myth. Or maybe links that claim lowering taxes on the highest earners would benefit the lowest earners. On issues like this people always find the resource that supports their pre-existing position. I'm not looking to argue the point. I'm just stating my position. Others will disagree. No one is likely to have their mind changed in an internet forum.

I arrive at a figure easily, based solely from a moral standpoint. EVERY taxpayer should be permitted to keep more than half their income. Forty-five percent total, max. Leave it up to the States, Feds, and localities to arrive at that figure. Forcing a citizen to surrender more than half their income is legalized extortion. Just one man's opinion...

A simplified tax code would make that possible. Easily. Right, Fuji?

After all these years, hasn't anyones mind been changed around here?

After all these years, hasn't anyones mind been changed around here?

Mine was once. I initially thought the ABB's version of Into The Mystic was good. But I was convinced otherwise.

After all these years, hasn't anyones mind been changed around here?

Mine was once. I initially thought the ABB's version of Into The Mystic was good. But I was convinced otherwise.

😮

Progressivity has been pushed so far that the bulk of our tax revenues are now balanced on a small portion of the population. That sliver - the wealthy - often have highly variable income year-to-year as markets change. A large market adjustment downward craters tax collections, as we saw in 2007-2010.

Everyone should be exposed to the burden of citizenship, and pay something. Progressivity has gone way to far in the pursuit of voting blocks. We're paying a price for that, and likely will pay a worse one in the future. But the politicians pandering to that could care less as long as their power is preserved.

That's crap, IMO. Even marginal middle class families and individuals still pay significant income taxes and even more in payroll taxes, but you make it sound like only "the wealthy" pay taxes.

I guess it's crap if you support the political aims of progressivity: promising freebies from the public trough, paid for by "the rich", at little to no expense for the mid and lower classes, in exchange for their electoral support. Those feeling the Bern over this prospect as bad as children, believing in ideas that they can get something for almost nothing.

If you want an income tax, it should be a flat percentage. A consumption tax would be a vast improvement, but that's another story.

Progressivity has been pushed so far that the bulk of our tax revenues are now balanced on a small portion of the population. That sliver - the wealthy - often have highly variable income year-to-year as markets change. A large market adjustment downward craters tax collections, as we saw in 2007-2010.

Everyone should be exposed to the burden of citizenship, and pay something. Progressivity has gone way to far in the pursuit of voting blocks. We're paying a price for that, and likely will pay a worse one in the future. But the politicians pandering to that could care less as long as their power is preserved.

That's crap, IMO. Even marginal middle class families and individuals still pay significant income taxes and even more in payroll taxes, but you make it sound like only "the wealthy" pay taxes.

I guess it's crap if you support the political aims of progressivity: promising freebies from the public trough, paid for by "the rich", at little to no expense for the mid and lower classes, in exchange for their electoral support. Those feeling the Bern over this prospect as bad as children, believing in ideas that they can get something for almost nothing.

If you want an income tax, it should be a flat percentage. A consumption tax would be a vast improvement, but that's another story.

Sounds like a political argument, not an economic one. In any case, it's your opinion, doesn't mean I or anyone else has to agree or that you're right.

L.P.D.: Libertarian Police Department

I was shooting heroin and reading “The Fountainhead” in the front seat of my privately owned police cruiser when a call came in. I put a quarter in the radio to activate it. It was the chief.

“Bad news, detective. We got a situation.”

“What? Is the mayor trying to ban trans fats again?”

“Worse. Somebody just stole four hundred and forty-seven million dollars’ worth of bitcoins.”

The heroin needle practically fell out of my arm. “What kind of monster would do something like that? Bitcoins are the ultimate currency: virtual, anonymous, stateless. They represent true economic freedom, not subject to arbitrary manipulation by any government. Do we have any leads?”

“Not yet. But mark my words: we’re going to figure out who did this and we’re going to take them down … provided someone pays us a fair market rate to do so.”

“Easy, chief,” I said. “Any rate the market offers is, by definition, fair.”

He laughed. “That’s why you’re the best I got, Lisowski. Now you get out there and find those bitcoins.”

“Don’t worry,” I said. “I’m on it.”

I put a quarter in the siren. Ten minutes later, I was on the scene. It was a normal office building, strangled on all sides by public sidewalks. I hopped over them and went inside.

“Home Depot™ Presents the Police!®” I said, flashing my badge and my gun and a small picture of Ron Paul. “Nobody move unless you want to!” They didn’t.

“Now, which one of you punks is going to pay me to investigate this crime?” No one spoke up.

“Come on,” I said. “Don’t you all understand that the protection of private property is the foundation of all personal liberty?”

It didn’t seem like they did.

“Seriously, guys. Without a strong economic motivator, I’m just going to stand here and not solve this case. Cash is fine, but I prefer being paid in gold bullion or autographed Penn Jillette posters.”

Nothing. These people were stonewalling me. It almost seemed like they didn’t care that a fortune in computer money invented to buy drugs was missing.

I figured I could wait them out. I lit several cigarettes indoors. A pregnant lady coughed, and I told her that secondhand smoke is a myth. Just then, a man in glasses made a break for it.

“Subway™ Eat Fresh and Freeze, Scumbag!®” I yelled.

Too late. He was already out the front door. I went after him.

“Stop right there!” I yelled as I ran. He was faster than me because I always try to avoid stepping on public sidewalks. Our country needs a private-sidewalk voucher system, but, thanks to the incestuous interplay between our corrupt federal government and the public-sidewalk lobby, it will never happen.

I was losing him. “Listen, I’ll pay you to stop!” I yelled. “What would you consider an appropriate price point for stopping? I’ll offer you a thirteenth of an ounce of gold and a gently worn ‘Bob Barr ‘08’ extra-large long-sleeved men’s T-shirt!”

He turned. In his hand was a revolver that the Constitution said he had every right to own. He fired at me and missed. I pulled my own gun, put a quarter in it, and fired back. The bullet lodged in a U.S.P.S. mailbox less than a foot from his head. I shot the mailbox again, on purpose.

“All right, all right!” the man yelled, throwing down his weapon. “I give up, cop! I confess: I took the bitcoins.”

“Why’d you do it?” I asked, as I slapped a pair of Oikos™ Greek Yogurt Presents Handcuffs® on the guy.

“Because I was afraid.”

“Afraid?”

“Afraid of an economic future free from the pernicious meddling of central bankers,” he said. “I’m a central banker.”

I wanted to coldcock the guy. Years ago, a central banker killed my partner. Instead, I shook my head.

“Let this be a message to all your central-banker friends out on the street,” I said. “No matter how many bitcoins you steal, you’ll never take away the dream of an open society based on the principles of personal and economic freedom.”

He nodded, because he knew I was right. Then he swiped his credit card to pay me for arresting him.

http://www.newyorker.com/humor/shouts-murmurs/l-p-d-libertarian-police-department

I guess it's crap if you support the political aims of progressivity: promising freebies from the public trough, paid for by "the rich", at little to no expense for the mid and lower classes, in exchange for their electoral support. Those feeling the Bern over this prospect as bad as children, believing in ideas that they can get something for almost nothing.

So you think educating the population and keeping the population healthy has only one result? That the healthy and educated populace will pledge their support to a certain political party?

Won't an educated and healthy group of people contribute more to the country and to our society?