Friday, May 06, 2011

"Do you know what would happen if we pigs failed in our duty? Jones
would come back! Yes, Jones would come back! Surely, comrades," cried
Squealer almost pleadingly, skipping from side to side and whisking his
tail, "surely there is no one among you who wants to see Jones come back?"


- Squealer, in George Orwell's Animal Farm, 1947



Taxation Disinformation From The GOP


In Orwell's classic, Squealer spoke on behalf of Napoleon, analogous here to Republican Senator Chuck Grassley of Iowa, who recently whined

I get sick and tired of the demagoguery that goes on in Washington about taxing higher-income people. How high do taxes have to go to satisfy the appetite of people in this Congress to spend money?

How high do taxes have to go. Surely, comrades, none of you wants to see Jones come back! Stated in this way, how could any of the animals but believe things must have been much worse under Jones? And if a United States Senator includes as his premise "how high do taxes have to go," surely they are going up, up, and up!

But they're not. Federal income taxes have been declining nationally both as a proportion of the gross domestic product and as a percentage of an individual's income, as McClatchy documents (chart, below):

The post-World War II historic average is that federal revenues equal about 18 percent of the U.S. gross domestic product, the broadest measure of annual economic production. In the year 2000, after the longest economic expansion in U.S. history, federal revenues equaled almost 21 percent of the economy. As a result, Washington cut taxes in 2001 and 2003.

Revenues plunged to around 15 percent of the economy in 2009 and 2010 amid the deep financial crisis, and dipped even further this year, to 14.4 percent, the lowest level since 1950....

Americans across all income classes paid lower effective tax rates in 2007, the last year of complete Internal Revenue Service data, than they did in 2000. The effective tax rate is what people pay after all exemptions and deductions. This is according to the most recent comprehensive look at taxes by the nonpartisan Congressional Budget Office....

Americans on average saw 17.3 percent of their income go to federal taxes in 2009 and 2010. The last time the percentage was this low was 1975, and during the late 1960s.

If you exclude social insurance taxes on wages — for Medicare and Social Security — the share of taxes as a percentage of income drops to 9.4 percent in 2009 and 9.3 percent in 2010, the lowest since 1950.







That was in 2007. Since then, however, the "total tax burden — for all federal, state and local taxes — dropped to 23.6% of income in the first quarter, according to Bureau of Economic Analysis data. By contrast, individuals spent roughly 27% of income on taxes in the 1970s, 1980s and the 1990s."

The good news: of we still were taxed at 27%, it "would mean $500 billion of extra taxes annually today, one-third of the estimated $1.5 trillion federal deficit this year." The bad news: one party continually trout out its slick talking point- "Washington has a spending problem, not a revenue problem." Washington's real problem, however, is that the GOP is in constant pander mode, brazenly dishonest, and delights in misleading the nation's taxpayers.




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