The Most Misleading Part of 'the 47%': Total U.S. Taxes Are Barely Progressive

More
We do not live in the world Ayn Rand imagined

JohnGalt.jpg
(Wikimedia Commons)
Are we John Galt? 

Mitt Romney is worried that half of us make the wealth and half of us take the wealth. So is his running mate Paul Ryan. If this sounds like something out of a dystopian novel, that's because it is. The world we live in is far different from the world Ayn Rand imagined. Just take a look at total taxes.

The chart below, from the Citizens for Tax Justice, looks at how much households earn and how much they pay in all taxes. In other words, it compares what percent of overall income they make and what percent of overall taxes the government takes from them. It's not exactly a picture of moochers waging war on heroic entrepreneurs.

ProgressiveTaxes.png

We barely have a progressive tax system. People basically pay what they earn -- even the top 1 percent. How is this possible when 47 percent of people do not have any federal income tax liability? Well, there are lots of other taxes, and they're mostly regressive. The payroll tax and state and local taxes all hit poorer households harder than they hit richer households. Once you add up the progressive federal income tax and the regressive federal payroll tax -- which raise roughly the same amount of revenue -- with regressive state and local taxes, you only just get a progressive system overall.

If this is Marxism, it's very carefully disguised.
Jump to comments
Presented by

Matthew O'Brien

Matthew O'Brien is a former senior associate editor at The Atlantic.

Get Today's Top Stories in Your Inbox (preview)

Adventures in Legal Weed

Colorado is now well into its first year as the first state to legalize recreational marijuana. How's it going? James Hamblin visits Aspen.


Elsewhere on the web

Join the Discussion

After you comment, click Post. If you’re not already logged in you will be asked to log in or register. blog comments powered by Disqus

Video

Adventures in Legal Weed

Colorado is now well into its first year as the first state to legalize recreational marijuana. How's it going? James Hamblin visits Aspen.

Video

What Makes a Story Great?

The storytellers behind House of CardsandThis American Life reflect on the creative process.

Video

Tracing Sriracha's Origin to Thailand

Ever wonder how the wildly popular hot sauce got its name? It all started in Si Racha.

Video

Where Confiscated Wildlife Ends Up

A government facility outside of Denver houses more than a million products of the illegal wildlife trade, from tigers and bears to bald eagles.

Video

Is Wine Healthy?

James Hamblin prepares to impress his date with knowledge about the health benefits of wine.

Video

The World's Largest Balloon Festival

Nine days, more than 700 balloons, and a whole lot of hot air

Writers

Up
Down

More in Business

Just In