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    The Untaxed 51%

    By Michael Maiello on Wed, 05/25/2011 - 10:24am | Politics

    Lately, we've been hearing from conservatives that 51% of Americans don't pay federal income taxes.  This is meant to put the kibosh on any attempts at raising taxes on wealthy individuals by painting everyone from the middle class on down as freeloaders.  We are already, the argument goes, letting the wealthy pay for the upkeep of the country, so the next sacrifice needs to come from working people.  I took this issue up in The Daily this week.

    Back in 2002, The Wall Street Journal called working Americans who pay no federal income tax "lucky duckies." They were referring to 33% of tax filers who had zero federal income tax liability in 2005.  The new controversy pegs the number at 51% for 2009 and has mostly been promoted by Eric Cantor.

    So far as I can tell, the numbers are true.  If you talk only of the federal income tax and not social security or medicare or state taxes or sales taxes or anything else, a portion of the American public, because they make use of various deductions or receive various credits, don't pay federal income tax.

    Why 51% in 2009 and 33% in 2005?  Because 2009 was the trough of a recession and 2005 was a boom year.  While Cantor looks at this figure and sees working Americans taking advantage of their wealthier fellow citizens, I actually see something of a misery index.

    It is bad that 51% of tax filers in 2009 didn't owe any federal income tax because it means the economy failed them.  It means that 51% of working Americans were unable to make ends meet without help from deductions and credits.  It means that people can't afford to raise their children, save for retirement or keep or buy homes without some help.  These are people who the economy has basically failed.

    In a sense, I agree with Cantor.  Everybody should pay some income tax.  But Cantor's solution is to eliminate deductions and credits (essentially raising taxes on the poor).  I contend that the problem isn't that we have deductions and credits available to help people along in life.  It's that wages are too low and benefits for health and retirement are too stingy.

    We should be asking why so many people make so little for their labors.

    I hardly need to say this to the Dag audience, but there is nothing enviable about people who have no tax liability or who get a subsidy through the earned income tax credit.  Most people, when faced with the choice, would pick the scenario where they have higher income and a tax bill than the one where they're scraping by and counting on an April refund to avert financial ruin.  People who receive the earned income tax credit, by the way, are really struggling.  Were I a crueler sort, I'd wish that any right wingers who claim to be jealous of these people would be forced to live 5 years under those circumstances.  But I really don't think any American should live that way, not even the closed-minded and stone hearted.

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    Comments

    One of the more discouraging facts about encountering a good portion of my high school class on FB was the number of times this statistic was raised--and all the solutions proffered for correcting this "horrible" freeloading.

    Someone thought we could have a national lottery with prizes like a night in the Lincoln Bedroom as a way of "coaxing" the 51% to pony up.

    It became sort of a ping pong game with one side citing the 51% and talking about how hard the rich have it and the other side retorting, "Well, you own virtually all of America--what do you expect?"

    It became pointless after a while.

    One guy, who I'm sure makes well north of 350,000 a year, was griping about someone making 50K and paying no tax.

    After he had stated that 250K wasn't rich and a higher tax (even a 3¢ hike) would impose a hardship and slow the economy, etc., I told him that if I were making 250,000, I'd be EMBARRASSED to gripe about someone getting a tax break who made ONE FIFTH of what I did and was supporting a family of four.

    Sheesh! It's a disease of greed that's overcome the country.

    A family member who just sold his business for $33 million told me (with a straight face) that taxes make it hard to save. In the interest of shalom bias, I kept my mouth shut. But I had to ask myself, "Is it catching?"


    by Peter Schwartz on Wed, 05/25/2011 - 5:29pm

    The Joseph in Genesis told the Pharoh that the best way to avert catastrophe in the future was to store the extra grain during boom times.

    Sure enough the bad times arrived and the Egyptian people survived because of Joseph's advise.

    Well, w bush found himself with a surplus and gave it all back to the rich. Sure, some of the middle class received enough to purchase a toaster but...

    When confronted with this nonegalitarian situation, w told us:

    Well them other folks did not pay any taxes!

    This frickin argument has been made for a hundred years. And there is no way to impress upon the fascist pricks in this country that EVERYBODY PAYS TAXES EVERY GODDAMN DAY!

    Now if you buy Ron Paul's arguments along with his son Curly Rand, the government exists only to protect those with property.

    And that my son is the corner stone of the repub platform and has been for a hundred years.

    the end


    by Richard Day on Wed, 05/25/2011 - 6:25pm

    Accepting the EITC is voluntary. Just because a person is eligible to receive it does not mean that person is required to take it. They don't have to fill out the extra paperwork. They can let it pass.  But, why should they?

    A person who earns enough money requiring them to pay an amount of that income towards taxes takes every advantage of tax laws and loopholes to make sure what they pay is the smallest amount possible. The smart ones do anyway. They make the tax code work for them. Why shouldn't they?

    So, "rich" people can be smart and avoid paying the full amount of their taxes.

    But, poor people aren't allowed to be smart about taking advantage of the tax code? Why is there such a pronounced double standard between the rich and the working poor? An eight hour work day lasts eight hours whether one makes $7.50 an hour or $750 an hour.

    Poor people are not stupid. They are poor. They have every right to take advantage of what the tax code allows.


    by wabby on Wed, 05/25/2011 - 9:29pm

    And I should add...."and not make them (the poor) feel sub-human for doing so."


    by wabby on Wed, 05/25/2011 - 9:34pm