Conservatives sure do get silly when they talk about taxes. I don’t just mean the expressions they get on their faces, or how red their faces get, or the way their hair sticks straight up and their eyes get all big. And I don’t mean the way they shake and sweat or even the stuttering. I mean the silly things they actually say.
Of course we have all heard a few hundred variations of “taxes are theft,” “government collects taxes at gunpoint,” etc.
Then there is the Randian “if you tax me I won’t work” argument known as “going Galt.” It assumes everyone is a 5-year-old who throws a fit if you ask them to help out with the chores. Which baseball player, actor, surgeon, etc. do you know who just quits partway through the year — and is allowed back the next year?
They get especially silly and agitated when it comes to taxing the rich. (They know to dance with the ones that brung them.) There is the “the rich already pay most of the taxes” argument that ignores the Social Security, sales, property, vehicle, phone and all non-income taxes working people pay — not to mention the fact that the rich make most of the income! There is the old “rich people create jobs” argument that doesn’t understand about customers and demand. There’s the old “if you tax them they will just leave” argument that assumes the rich hate America, don’t love it and will leave it.
There’s the old classic, “they’ll just find loopholes and ways to get around paying anyway.” And I guess murder shouldn’t be illegal because not everyone gets caught.
And then there is the old “they don’t have enough money to pay off the entire debt in one year so don’t tax them at all” argument that Ross Douthat trots out today in the NY Times. In The Middle-Class Tax Trap, Douthat writes,
Last week, in his address on deficit reduction, the president followed the playbook once again. … Obama promised “tough choices” that put “everything on the table.” But his tax proposals were aptly summarized by The Atlantic’s Clive Crook: “The rich can pay for it all.”
Under the president’s plan, we soak the rich in the short term, and then just keep going deeper into the red.
After complaining that bringing taxes on wealthy back up to less than half where they were before we had deficits and decline is “squeezing” and “punishing” them, he strawmans that the “liberal” plan is just let taxes rise, with emphasis on middle-class taxes. To top everything of, then he says,
Today, for instance, a family of four making the median income — $94,900 — pays 15 percent in federal taxes. By 2035, under the C.B.O. projection, payroll and income taxes would claim 25 percent of that family’s paycheck. The marginal tax rate on labor income would rise from 29 percent to 38 percent. Federal tax revenue, which has averaged 18 percent of G.D.P. since World War II, would hit 23 percent by the 2030s and climb even higher after that.
Such unprecedented levels of taxation would throw up hurdles to entrepreneurship, family formation and upward mobility.
Finally Douthat writes that “a population that’s increasingly brown and beige” being hit with “punishing” tax rates on the rich would “Balkinize” us because Medicare’s “promise to the elderly crowds out the fundamental promise of America itself.”
There is so much wrong with that… I guess I missed the “family of four” line on tax returns where all of them add their incomes together, which pushes the combined income up to higher brackets before paying taxes on the total. What I mean is families of four file separately, not together. And $94,000 or wherever it will be in the 2030s doesn’t pay the highest rate. And paying taxes will “Balkinize” us? What? And unicorns! (unicorns reference explained at the bottom of this post.)
Dean Baker takes on the median income claim, in Douthat Makes It Up On Median Family Income,
Ross Douthat struck another blow against fact-based arguments when he told readers that the median family of four has an income of $94,900. Douthat warned that if the Bush tax cuts are allowed to expire in 24 years the median family would be paying a marginal tax rate of 39 percent on their labor income.
If Douthat wanted to base this argument in reality then he would have had to start with a median income for a family of four of $75,700.
(Note that median household income is only about $52K; using this “family of four” estimate which includes estimates for health insurance and payroll taxes is just one more conservative trick.)
Scott Lemieux, in The Fuzzy Math in Douthat’s Defense of Paul Ryan, writes,
Douthat is writing an opinion column, but I would like to think that his editors don’t think he’s entitled to his own facts. And the fake fact is crucial to Douthat’s argument, as it both exaggerates the tax burden a typical family would face if existing law were to be carried forward and implicitly understates the gross inequalities of income distribution in America. It probably says something that apparently nobody looking at the column thought that Douthat’s bogus figures were implausible enough to be worth checking.
This was my reaction as well. Are people at the NY Times paid that much, that they are so separated from the reality out here in the rest of the country? $94,000 median incomes?
And A Unicorn plus a candy mountain:
**PS Douthat writes about “The yan Plan.” The “Ryan Plan” is the Republican budget resolution passed in the House last week that privatizes Medicare. It should be called “The Republican Plan To Privatize Medicare” because the public needs to know this.