Taxes: Who Pays How Much in Eight Charts

  • submit to reddit
There was a steady stream of post office customers dropping off mail including their tax forms at the Pembroke Pines, Fla., Tuesday, April 15, 2014. The post office placed signs on the mail boxes to inform patrons about times. (AP Photo/J Pat Carter)
There was a steady stream of post office customers dropping off mail including their tax forms at the Pembroke Pines, Florida, Tuesday, April 15, 2014. The post office placed signs on the mail boxes to inform patrons about times. (AP Photo/J Pat Carter)

Ideological arguments about whether taxes are too high or too low miss the crucial question of who ends up bearing how much of the burden of financing our public sector.

There’s an inescapable reality surrounding that question: unlike corporations and the ultra-rich, America’s working majority have neither the lobbyists to write loopholes into the tax code, nor the financial planners and high-end tax accountants to exploit them.

The result, as economist Joseph E. Stiglitz tells Bill Moyers, is a system that is fundamentally unfair. Here are eight charts that illustrate how our tax burden has shifted over the years, and why we need to reform our tax code.

The US Is One of the Least Taxed Countries

Here’s some important context: Overall, we pay relatively little in taxes today compared to other wealthy countries.

Of the 24 countries that were members of the Organization for Economic Cooperation and Development (OECD) in 1979, the US paid the 16th highest share of its economic output in taxes.

Fast-forward to 2010, and the US was the third least taxed country, ranking 32nd out of 34 OECD countries in terms of taxes as a percentage of Gross Domestic Product (GDP). As the graph below shows, only two countries, Chile and Mexico, paid less in taxes than the US did in 2010. And as the green bar shows, the 24.8 percent we forked over in taxes was significantly less than the average of 33.4 percent that the other 33 countries paid.

On the Federal Level, Corporate Taxes Are Down and Payroll Taxes Are Up

This graphic shows that since 1950 the share of federal revenues from individual income taxes has remained relatively stable. But during that same period, corporations’ share of the burden has plummeted, while the contributions from workers’ payroll taxes have dramatically increased.

That’s an important point because payroll taxes are regressive — after the first $117,000, the more money a person makes, the smaller the share of income gets deducted from his or her paycheck.

Share of federal tax revenue, by source

(Chart: Mother Jones)

Federal Taxes Are Down; State and Local Taxes Are Up

As you can see from the chart below, the federal government collected a smaller share of the nation’s economic output in taxes from 2010 to 2012 than it had at any time since 1950.

But over that same period, since 1950, the share collected by state and local governments has almost doubled.

Why That Matters

Perhaps you’re thinking, ‘Why does the distinction between federal taxes and state and local taxes matter? A buck is a buck.’

The reason it’s important is because at the federal level, those with higher incomes pay a larger share of their incomes in taxes than those who earn less, as the chart below shows.

While the richer pay a higher tax rate at the federal level, the opposite is true when it comes to state and local taxes. As the chart below shows, in 2011, America’s top earners paid a lower percentage of state and local taxes on their income, 7.9 percent, while the bottom earners paid a higher rate at 12.3 percent.

Many states’ income taxes are less progressive than the federal system, property taxes tend to be somewhat regressive and sales and “sin” taxes are very regressive. A 2013 study by the Institute on Taxation and Policy found that those kinds of consumption taxes averaged a “7 percent rate for the poor, a 4.6 percent rate for middle incomes, and a 0.9 percent rate for the wealthiest taxpayers.”

Polls consistently find that most Americans across the ideological spectrum favor the principle of progressive taxation — with the wealthier bearing a bigger piece of the burden than the middle class and the poor. Shifting federal taxes to the state and local levels makes our system less progressive overall.

Who Gets the Tax Breaks?

The chart below shows the percent of all tax breaks — the myriad deductions and credits written into our tax code — given to individuals at different income levels. The Congressional Budget Office says these breaks “resemble federal spending by providing financial assistance to specific activities, entities, or groups of people.”

As you will see below, the highest income group got the lion’s share of the tax breaks, 51 percent, while the lowest income group got the least, 8 percent.

What about the Tippy-Top?

As much as we talk about income inequality and the 1 percent, the greatest inequities exist even higher in the economic stratosphere.

This chart looks only at the wealthiest 400 families. They make up about the top 1 percent of the 1 percent. While their average income increased by 392 percent between 1992 and 2007 (and most of us are thrilled when we get a cost of living increase of 3 percent), their tax rate dropped by 37 percent.

Changes in taxes for top 400 earners.

(Graphic: Mother Jones)

Joshua Holland is a senior digital producer for BillMoyers.com. He’s the author of The Fifteen Biggest Lies About the Economy (and Everything Else the Right Doesn’t Want You to Know about Taxes, Jobs and Corporate America) (Wiley: 2010), and host of Politics and Reality Radio. Follow him on Twitter or drop him an email at hollandj [at] moyersmedia [dot] com.
  • submit to reddit
  • Anonymous

    Oh silly us…we were under the illusion that when we elected our congressional representatives, that is what they were supposed to do-lobby for us.

  • Anonymous

    Thank you.

  • Anonymous

    So what are the specific income levels that define each quintile? With that one set of numbers everyone reading can see where they personally fall in these analyses. Otherwise, it’s just theory.

  • Pat Branigan

    Europeans get so much for their taxes and we get so little. their entire citizenry get healthcare, retirement, day care, schooling through college plus a safety net. What do we get an inadequate retirement, maybe a little help with healthcare, day care if you are in a poverty program that they take from you as soon as you are making a little money but not enough, Crappy public schools and huge college debt. And the Republicans pulling unemployment out from under you in the worst recession since the Great Depression. Oh wait we get stupid wars that cost us money, prove nothing and proliferate terrorism. No wonder Americans hate taxes.

  • Anonymous

    Oh boy, someone needs to go back to grade school.

    The graphs show that 2010 Federal taxes in the US were 15.1% of GDP and state and local taxes were 13.9% of GDP, for a total of 29%, which would put the US tax rate higher than Switzerland, Japan, Australia and other high tax places.

    Yet, in the OECED total tax chart, it is listing the US tax rate as below 25%.

    Hard to take the rest of the article seriously, when the most relevant statistic it is off by US$750,000,000,000.

  • Anonymous

    Congratulations to Joshua Holland for easy to understand and mind-blowing statistics and great graphics. Sometimes a picture tells it all.

  • Nick

    I learned in grade school not to add percentages.

    I learned in high school that it was particularly important not to add percentages when they are derived from different data sets.

  • Anonymous

    $120 million dollar aircraft… and FREEDOM to be poor!

  • Anonymous

    So you are saying other countries do not have state and local taxes like sales tax or real estate tax. So while I was living in Spain paying import and real estate taxes it was going where? To the church as tithings I suppose. Nice try!

  • Anonymous

    No it’s not – just shows you’re too lazy to use Google to figure it out if you don’t know already.

  • Anonymous

    You have a serious problem with math… and reading charts.

  • Anonymous

    like Jacqueline implied I’m
    taken by surprise that a mom can earn $8130 in 1 month on the computer . see
    post F­i­s­c­a­l­p­o­s­t­.­C­O­M­

  • Anonymous

    You get a prize! OECD uses “harmonized” data to do cross-country comparisons, while the state and local tax data is from Census and the federal tax data is from OMB.

  • cgmcle

    I thought it would be informative to compare tax rate as a percent of GDP with a happiness index for the OECD countries. I was able to find the OECD’s list of the 11 happiest countries in 2010 (top 11 instead of top 10 because there was a tie) along with their happiness scores. I intended to find the correlation between tax rate and happiness, but there is severe restriction of range for the happiness score (7.4 – 7.8), so a correlation would be misleading. Someday soon when I have more time (busy weekend) I’ll try to find more complete data to conduct a proper analysis.

    In the meantime, the preliminary findings are suggestive. Of the countries with the top 9 tax rates, 6 (67%) are among the top 11 in happiness. Of the 25 remaining countries, with lower tax rates, 5 (20%) are among the top 11 in happiness.

  • Anonymous

    We do not have a tax problem. We have a compassion, wisdom, human problem. Those with no need for more wealth/power, keep accumulating more because the system is set up for them. Instead of spending on creating more problems by spending on electing lap-dogs, they should think about creating a better social order that serves all and endear the super rich/super powerful as genuine leaders. Think Warren Buffett and Bill Gates…..

  • Anonymous

    I’m not saying any such thing. The OECD chart is ALL taxes (federal, state/province, local) for all countries.

  • Anonymous

    Wow – you learned in high school not to add percentages? Really?

    The OECD charts are based on individual country statistics collected by each country’s national finance authorities reported to the OECD on total taxation. And it is nothing more, nothing less than total taxation.

  • Anonymous

    First of all the OECD stats are freely available on the net at stats dot OECD dot org. And the explanation is very clear. For the taxation table there is no adjustments. For GDP you can view with nominal or PPP. For the taxation table it doesn’t matter because the results would be the same, nominal or PPP – since both GDP and taxes use the same calculation.

    Second, data is available all the way to 2012, not just 2010, as state in the sites where you extracted the data (Citizens for Tax Justice).

    Finally, clearly the national charts and the OECD charts do not agree with each other by the tune of 3/4 of a trillion dollars or nearly 5% of GDP. Not a trivial difference.

    Either an explanation for the discrepancy needs to be posted, or the validity of the charts come into question. Hard to have it both ways.

    But the key thing is the distribution of taxation. In virtually all the OECD countries – e.g. all of Europe – most of the revenue is regressive, in the form of a very high (20%+ in Europe) VAT national tax.

    So if the point is – you can raise more tax revenue with a flat, broad based, but regressive, tax. Yes – absolutely.

    Are you sure you want that in the US?

  • Nathan Phoenix

    Two words: French Revolution

  • UncleBucky

    There always has to be one to spoil the broth, in this case, baron95. Sad, sad, sad…

  • Nick

    No, I learned in grade school not to add percentages. I learned reading comprehension, too.

    If all the charts were based on the same data, your claim that
    5% of GDP is missing might be accurate. But the federal tax rate data is from OMB and the state and local tax data is from the U.S. Bureauy of Economic Analysis, You added that dissimilar data and compared the result to the OECD charts. Your “missing” three-quarters of a trillion dollars is most likely lost in the differences between those three data sets.

    Did all three data sets use the same values for GDP? Was ‘taxation’ defined consistently between the data sets? You simply can’t mix the data sets like you did and expect accurate results.

  • D J Bak

    Even assuming your figure of 29% is right and the chart includes all other taxes (local, VAT, etc), The US would still be in the bottom third – and I believe that all of the countries above it have universal health care and more government help with other expenses such as education, child care, etc. Also, if one part is a bit off, why should that make you question all of the rest – unless you are presupposed to do so?

  • Anonymous

    There is no need to assume anything. The OECD data is for all taxes, federal, state/province/local. The data, much more up to date than what was posted here, is freely available on stats dot oecd dot org.

  • Anonymous

    There is nothing to expose.

    The US is simply enabling people to decide if they want to live in a high tax state like California, New York or Illinois or a low tax state like Texas of Florida.

    Residents of New York City have total tax rate burden that would put them at the top of the OECD list, while residents of Texas have total tax rates that would place them at the very bottom.

    Over time residents will migrate to the tax/spend state they think is more effective.

    What do you have against choice. Move to New York City, Chicago, Philadelphia if you believe that high taxation has an advantage. You can self select into high taxation.

  • John A Gulsby

    They say that taxes on corporations are just passed along to their customers. So, let’s let the corporations pay all the taxes and the rest of us will pick up our share when we buy their products and services!

  • Anonymous

    You’re comparing three different charts using three different sources. If you can’t understand how all three could be accurate, I’m afraid there’s nothing I could say in a brief reply to help. Though when you use a phrase like “agenda for higher taxes”, I fear you already have an ideology that eschews facts.

  • Michael Enders

    One factor that ties many of these charts togethe is unfunded or underfunded mandates. The federal government creates programs that cost money, but shifts the burden for financing them to the states. Considering the growing proportion of taxation happening at the state level, I wonder how much importance the first chart has. Where would the U.S. rank if all taxes (including state and local) were considered instead of jus the taxes raised at the national level. I think one thing that conservatives and liberals should be able to agree on is that the tax code needs to be simplified to make it hardier to game the system.

  • BeliTsari

    Well, privatization of taxpayer’s infrastructure, services & governance couldn’t ignore the mob, could it? ALEC’s Kleptocracy has legalized Wall Street’s theft of our equity, labor, homes & retirements. Court mandated, OathKeeper enforced foreclosures, incarceration, indentured peonage, state legislated shake-down… The State has become our bosses’ collection agency & they never stop calling.

  • Jason Behr

    You miss the point. Its those southern states that dont tax the top that get subsidized by the northern states. Imagine how the southern state tax rates would change if they weren’t allowed to receive more federal tax dollars than they put in. The transfer of tax burden through state/local taxes has been going on since Reagan.

  • Nick

    The U.S. would rank right about where it is on the OECD chart, as that chart takes total taxation–federal, state, & local–into account.

  • Anonymous

    Now if I could only get my fellow Democrats and Conservative friends to read this.
    “Reading is fundamental.”

  • Anonymous

    Two words: The next American Revolution. OK…..four words. : – (

  • Anonymous

    Are you kidding? Surely, you are kidding. I am no expert; however, I do know that the paying of taxes is how you take care of a people and their country.

    By the state of the affairs of this country, it is obvious that our taxes are going elsewhere.

  • catman

    Exactly! The US spends 27% of Federal tax dollars on defense, while many of our NATO allies (those Europeans who get so much for their taxes) spend less than 2% on defense. Freedom is worth paying to defend – but all who enjoy it should pay their share.

  • Andrew Diamond

    That isn’t true. Markets set prices. Whether taxes become part of a price increase or not is a function of the market. Taxes can also be a reduction in after tax net income and retained earnings or dividends to shareholders.
    “They” say that because that is what they want you to believe.

  • James_R

    No one in a free country should have the power to dictate what other peoples’ needs are.

  • James_R

    Government is not a charitable organization.

  • Michael Enders

    Nick, yes, I figured that out after I made my post. I think much of the resistance to paying taxes comes from a sense that the tax code is complicated and unfair and the sense the much of the money that government receives is wasted. Personally, I wouldn’t mind paying taxes so much if i had more of a sense that the money was spent wisely and would even welcome paying more taxes if the government would be thrifty enough to start paying down its debt and not saddling future generations with it. I would really welcome a simpler tax code, because the enormous paperwork involved with taxes is even more painful than paying them.

  • Anonymous

    Yeah, sure. People are just going to pick up and move
    according to the tax burden they prefer to … People move for jobs, for family, for the desire to be in a city or out in the country. People move for many reasons, but I have yet to meet a single person who’s said oh, we moved to flat hot wasteland of Texas simply for the low taxes.

  • D J Bak

    Well then we re in the bottom third and pay through the nose for health and higher education and other items which other country’s citizens get subsidized for with their taxes.

  • Anonymous

    The Government is US!

    We all contribute to its care and feeding and that is why we
    should be reaping the benefits. The people in government are there at our behest. If they are not providing for us, and our communities then WE the people must take action to correct that.

    I for one do not think that the military and its greedy toadies should be getting most of my tax dollars. Perpetual war is not good for my country. I do think that public schools, need my money more and as well I want a healthcare system for all. I would call it Medicare.

    While I am at it and I have them by the throats I will be
    demanding that we put people back to work rebuilding our infrastructure. That meaning, our roads, bridges, dams and yes our schools and also cleaning up our environment
    and building low cost housing. I would demand a minimum wage of twenty dollars and hour thus putting more money in people’s pockets and stimulating the economy.

    If a man or woman has a job, a roof over their head and plenty to eat, and is guaranteed to be taken care of when ill or injured, then people feel secure, then what is there to fuss about. It is a very simple formula to act upon, and to enact. However, its simplicity seems to escape ability of the psychopathic lizard brains out there in TV Land.

  • James_R

    Our governments role is to keep us free from force and coercion.. It is not here to ensure we get paid specific wages, have food or affordable housing. It is your job to provide for you and your family not mine. I don’t go to work everyday at 6am so I can make sure that the department of housing and urban development is funded. I do it out of pure self interest. If you want to give money to charity than that is your decision but when government takes money out of my pocket via taxation and gives it to their favorite special interest that is not charity. It is false altruism.

  • Anonymous

    I guess you do not understand the role of a goverment of, by and for the people.

  • Anonymous

    I don’t miss any point. The citizens of each state are free to set their state taxation, public employee pensions, etc as they see fit. Competition and innovation in the states is healthy and good.

    And that includes taking advantage of programs funded by the Federal government. The Federal government sets its rules and revenue sharing formulas with the states, the states set theirs.

    Clean and simple. If you want to pay high personal income taxes go to California or New York City. If you don’t like persona; income tax, move to Texas, Florida, New Hampshire, etc.

    And for the person above who claims that no one moves for tax avoidance, that is a clueless comment. Many people from New York have Florida residences and make super shire they spend more than 1/2 the year in Florida to avoid New York taxes. And now states like California are going after taxing you for each day you are in the state, even if you spend the majority of your time somewhere else. That is how prevalent the practice is.

    Just look at Detroit – how many white people and middle class blacks fled the city to avoid the high tax, low services death spiral?

  • Nick

    I once suggested during a discussion on the legitimacy of corporate personhood that, if corporations were people, they should file their taxes using the individual tax forms and rules for self-employed income. The tax accountant I was speaking with at the time almost had a heart attack…laughing.

  • Jason Behr

    So you admit that its ok for those dead red southern states to free load off the federal government. What you call innovation I call transferring the tax burden onto the middle class and letting the top off the hook. Do you remember when this started under Reagan?

  • Anonymous

    What are you talking about? The vast majority of people in the US (90%+) get subsidized healthcare from their employers, Medicare or Medicate, AND, we get to keep more of our pay.

    Why do you think that the average home of a poor (bottom quintile) American is larger than the average home of a rich (top quintile) Dane?

    Why do you think that the average poor American has higher car ownership rates than a rich Dane?

    The material wealth of Americans towers over any of those high tax countries.

    Why?

  • Anonymous

    Did you even read this article and looked at the chart? The share of total taxes that are coming from local/state grew the most from 1950 to 1980 – look at the graph – nothing to do with Reagan.

    As for “red” states like Hew Hampshire, with no personal income taxes, getting more money from the Feds than the send in, what is the issue? The Feds set the national rules, the states set their rules accordingly.

    Same with me. Fed tells me I can deduct interest on my mortgage, I factor that into my buy vs rent decision. If they change the rules, I change my behavior. While the Feds choose to subsidize me, I take it.

  • Nick

    The Census Bureau’s numbers for 2012 show that 15.4% of Americans did not have healthcare.

    Absent supporting documentation, I don’t think the home of a rich Dane is, on average, smaller than the home of a poor American. But it’s always possible that Denmark has a lot less space available, that that space is much more tightly managed, that housing costs in Denmark run at least twice what they are in the States, and that a 1000 square foot house that might cost $60,000 in the U.S. countryside can cost up to $200k outside Vejle or Thisted and over $450k in Copenhagen.

    I think the average rich Dane probably only has enough room to park one or two cars (see limited space, above). I also think the average rich Dane paid two or three times what an American would pay for the car, and pays the highest gasoline price in Europe (currently $9.14/gallon, according to Bloomberg). I think the average rich Dane lives within a five- or ten-minute walk from a bus stop that connects her to a transit system that will take her to and from work rapidly and reliably, or lives close enough to work that she rides her bicycle. I also think the average rich Dane probably doesn’t live more than a five- or ten-minute walk from a grocery store, bakery, delicatessen, drugstore, drink shop (beer/wine/liquor sales), a couple of restaurants, and a bar.

    The average European doesn’t live more than a five- or ten-minute walk from a bus stop, and from there has access to a unified transit system that can take him to any other country in Europe vacation in less than 24 hours. They don’t need more than one car per family.

    In 2012, Denmark had median wealth per adult of $87,121 (#10 worldwide); the U.S. had $38,786 (#27, behind Cypress, for crying out loud!). I don’t where that tower of material wealth is, but it ain’t where most Americans are.

  • Nick

    Yet that is exactly what you do here.

  • Anonymous

    “In 2012, Denmark had median wealth per adult of $87,121 (#10 worldwide); the U.S. had $38,786″

    These figures mean nothing. When, in your own words the Dane needs to pay 3 times more for gasoline, three times more for a car, twice or three times more for credit, and much more than an American for virtually everything.

    That is why I wrote material wealth, vs financial wealth, which you quoted.

    If you want to buy a new car, is it better to make $50,000/year, but the car costs $75,000 or make $35,000/year, but the car only costs $25,000? Recheck your figures for 2014.

    As for your census report in 2012 for health care, did you forget that now we have Obama Care – you know “universal health care”?

  • Anonymous

    ??? What do you think all those lobbyists are doing in congress? They’re entire goal is to pass legislation to game the system, including taxes, federal and local. Nothing passes in congress that doesn’t benefit the 1%. Our “representatives” aren’t ours.

  • Anonymous

    Not really.
    When lobbyists legislate market (purchased via congress), free market principles swirled down the toilet.
    Offshored profits mean the shareholders get nothing, also legislated. Look up your holdings, corporate headquarters are Ireland, Cayman Islands, etc.

  • Anonymous

    Common sense does. Food, shelter, clothing. Our system is broken.

  • Anonymous

    Baron95, employers don’t “subsidize” anything. They either make a profit off of you or your gone. Laborers subsidize the 1%, by their labor and their taxes.

  • Anonymous

    Euro “universal health care” means it’s there for everyone via taxes, not the US version, where everyone’s required to have it via their own means (possible or not).

    $50K is better if you don’t need the car and most of them don’t. The US’ lack of effective public transportation is no accident.

  • James_R

    Very few people have common sense and even fewer people are brilliant enough to know what the needs are for each and every individual. Only the free market can do that.

  • James_R

    What?

  • James_R

    If shareholders in offshore businesses get nothing then these corporations would never be able to acquire or retain any investors..

  • Anonymous

    Legislated by Washington. Don’t know why their corruption is not targeted as root cause of the rising fiscal mayhem. Apparently shame is out of fashion. My vote’s anti-incumbent for at least the next 6 years.

  • Anonymous

    The entirety of payroll taxes is “progressive” meaning for every dollar a low income person puts in they get more than a dollar back in social security etc. and vice versa for high income (adjusted for time value, inflation etc.). Granted, it’s not as progressive as direct income transfers from high income to low income which seems to be what the Bill Moyers crowd is for, but it is misleading to look at one part of the social security program and call it regressive when social security is progressive over all.

  • Anonymous

    I get the anecdote but the idea that corporations are people isn’t the notion that people forming together in a corporation creates a new mythical person with the same rights a real person has. It is that a corporation is an association of individual people who shouldn’t be treated differently than other people just because they formally joined with others.

    Extreme examples are helpful- if you and I are both productive in our business endeavors and pay our taxes and have the same rights and treatment as everyone else, why should that change if we decide to join together and share resources and risk because we think that will make us more productive? That’s what a corporation is except the number of people associating is much larger.

    Shouldn’t policy incentivize this sort of efficiency and synergy? Doesn’t society as a whole benefit (assuming the enterprise’s activities are legal and ethical)?

  • Anonymous

    I fail to see the connection between taxes and compassion. I trust individuals (on average) to be more compassionate with their money than I do the government. The government allocates money by what will help them maintain or increase power, the only place compassion comes in is in the packaging.

  • Anonymous

    Add marijuana in Colorado.

  • Anonymous

    Your first line is a scary thought. It’s like a slogan on an old USSR poster. I don’t know how people think that way.

  • Anonymous

    I don’t live in Texas, but there are 5 families in my neighborhood who fled upstate NY citing high state and local taxes as a major reason.

  • Anonymous

    Unfortunately I know too many liberals who hold it as a core belief that if you oppose federal policies, you should be forced to pay in, but not allowed to benefit from them. This is deranged thinking.

  • Anonymous

    I never said that employers subsidize anything. I said that employees, like me, get subsidized health care (in my case by 85%) from employers. That is, in fact part of my compensation package, just like salary, vacation, etc. The point is, for the vast majority of Americans ( 90%) health insurance is a non issue.

    I’d much rather negotiate my package with my employer, rather than have a one size fit all mandate by government. That is just a preference. It has worked wonderfully well for me and my family for decades.

  • Anonymous

    True.

    And they also think that all the money belong to the government. So, if there is a rule that a corporation can take a tax deduction, that is called a “tax expenditure” from the government to the corporation, and dubbed “corporate welfare”.

    And they don’t see any issue with that. Money not paid in taxes is equated to the government giving you money.

    :)

  • Anonymous

    Get a new accountant. Because that is EXACTLY how Limited Liability CORPORATIONS (LLCs) are taxed – on the owners personal tax return.

    Laugh is on you, it seems.

  • JonThomas

    Define “free market” from your perspective please.

  • James_R

    a market economy in which the forces of supply and demand are free of intervention by a government, price-setting monopolies, or other authority.

  • James_R

    And you don’t seem to be bothered by the prospect of fostering an oppressive government.

  • James_R

    What does one’s tax rate have to do with paying for the amount of government that they use? If I make $100,000/yr and pay 20% of my income in taxes and you make $10,000/yr and pay 25% of your income towards taxes; I am still paying $17,500 a year more in taxes than you are. I am the one being fleeced.

  • James_R

    Moyers has always been a leftist. Unlike his louder more unruly collectivist compatriots, he espouses his views with a softer tone and a grand fatherly demeanor which allows him to portray himself as being politically middle of the road.

  • Anonymous

    Denmark is a small country, that borders only Germany, with less than 6 million people, 90% of whom are “Danish” by ethnicity. It’s hard to make any sort of relevant comparison between Denmark and the U.S.

  • http://www.facebook.com/RPManke.solar RevPhil Manke

    Military bases, the CIA et al, and war don’t come cheap. Easy money for the fools in govt enable bullying and terrorism instead of peace-making, which is the real and only Christian way.

  • R Andrews

    Imagine how the northern states would do if the government subsidies in corporate tax breaks favoring the financial industries ( north east) or defense contractors ( north east, west and west coast) similarly did not exist….. get the big picture.

  • Andrew C Livingston

    “get subsidized healthcare from their employers…”

    Why argue with Baron. He’s simply wrong and can’t even read his own comments. He really does not know what the hell he’s talking about.

  • Andrew C Livingston

    You are wrong. And yet you still keep opening your mouth.

    Your figures are laughably incorrect. Gas does cost more, often up to 3x but there is public transport EVERYWHERE. You do not need a car in Denmark. And a car costs around about the same price in both countries. Credit is not more expensive, quite how that could even be the case I’m sure you don’t know either.

    You are laughable.

  • Andrew C Livingston

    He does. Read ten of his comments and learn never, ever to pay any attention to him again.

  • Andrew C Livingston

    “We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America.”

    Sounds like “The government is US!” to my ears. You don’t know how people think that way? Then you don’t agree with the very principles our country was founded on. And as such, why do you get to participate in it?

    You can bash the Soviet Union all you like. Your rhetoric will push the next generation to accept communism as another viable alternative to the shambles of a system we now have. One day “conservatism” will be the new C-word in the US, one difference though: people will be right this time to believe it. Luckily we now have public record of how most people feel about it.

  • Anonymous

    Lets start with multi nationals and oversea profits being defended by our military and our embassies

  • lostinbago

    Aristocrats and their wealth are able to escape revolution, it is the lower classes who wind up going to the Guillotine in the fervor of mob rule.

  • lostinbago

    Health care provided by employers is calculated in as part of the pay and is therefore not subsidized, but is part of the employees pay package and they are paying for it themselves.

  • lostinbago

    baron, I also am doing well but that does not mean the system is just for those at the bottom. A society must ensure stability by providing basic security for all.

  • lostinbago

    Public transportation is needed, but it works much better in a compact area. How would you provide effective system in a thinly populated area such as Montana? That said, there is much we can do in more densely populated areas.

  • Anonymous

    That backs up the author. The article you link too shows quite clearly that the “workers” are getting screwed while the 1% are paying less.

  • Anonymous

    Collection points. So sprinkled in NH are “park and ride” lots, but the intent was ride share, not public transportation as it should’ve been. Many sparse rural areas are all commuting to larger metro.

    The current public transport only addresses alleviating crushing traffic, not majority traffic, as is apparent with the lack of parking at train stations. Full lot equals maxed out, which means that station is in effect dead for the rest of the day. Too much money being made off of traffic congestion: spiking real estate prices, gas, cars and car maintenance, tolls, for example.

    Also, no reason Amtrak is high priced. Oh pleaaaase take this out of the hands of Dukakis.

  • Anonymous

    Very telling, informative charts that will completely go over the heads of republicans. They are still calling for additional cuts at the top and for corporations.

  • James Grant

    baron, you are counting individuals not households. A common mistake.

  • Eric Bischoff

    I would agree with you if we went to a better model where we bring in democracy in the workplace in the form of worker ownership instead of preferential absentee shareholder ownership.

  • Eric Bischoff

    We have a me me me greed problem! It’s time to rise to the next level in society’s evolution which is the sharing and cooperation level.

  • Eric Bischoff

    Maybe you should also compare debt levels!

  • Rico Dagastino

    The entirety of payroll taxes in not progressive. Remember there is an upper limit to the amount of income taxed for Social Security purposes. This relatively low limit assures that taxation for this purpose is concentrated toward the lower end of the economic scale.

  • Vandelyn E. Leach

    Even the “not-so-mathematically-inclined” people spoke of this before “reaganomics.” Now what?

  • Anonymous

    What about the states they try to usurp federal authority on immigration and border security? Aside from having no jurisdiction, they seem more than happy to assume some “unfunded” non-mandates. It’s all about politics.

  • Anonymous

    These charts mislead the effective tax rates the rich pay. The charts reflect rates only, not the taxes paid after the myriad deductions and other avoidances allowed.

  • Anonymous

    Kev, tax policy can affect the common good of any society. Revenue + expenditure is a fact of life for every government. Tax policy can be selfish for the powerful or it can attempt to have a minimum standard of decency for its citizens’ well-being.

    We had strong middle-class growth + no booms or busts from the New Deal up until the oil shocks of the 1970s + Reaganomics thereafter. Dismantling of regulations imposed after the Great Crash (preceded regularly by other booms + crashes in the previous history of the United States) during the 1980s led to increasingly consequence free gambling by bankers + investors.

    Deregulation as a mantra is powerful in politics. But any activity in life demands some rules of play so that everyone’s on the same page. Unfair rules make for a rotten game. In real life the consequences of allowing recklessness in financial fields at the expense of impoverishing the bottom half can cause genuine misery + unrest. Industries that pollute poor neighborhoods far more directly than affluent ones still cost us all. This last, less directly involved, but often also involves tax incentives as well as poor environmental regulations +/or enforcement.

  • Anonymous

    I think we agree in principle, but I don’t see how you can see tax policy as it currently exists or does more than just the minimal as being “fair rules.” The major flaw that dooms progressive thinking is that while progressives think people are corrupt, reckless, selfish etc., they want similar (or even at times the same people) to have the power to coercively collect money and expect them to do what is right for all.

    There should be rules- basic civil rights, contract enforcement, protection of individuals and private property- but much beyond that has again and again proven to be a failure, to be unfair, and to not be productive concerning the common good.

    The better outcome is if people do with their income, earnings, and wealth as they see fit. If a rich person builds 10 mansions, that means a whole lot of people made a nice living building those mansions. If a rich person decides to invest in a company, that helps the company provide goods and services and jobs that make people’s lives better on the whole (or they wouldn’t accept the jobs or purchase the goods and services– the proof is in the pudding). If the government takes a significant share of that money, it too often is funneled, not to productive purposes as determined by the free will of citizens, but to those who will most likely keep the ones in power in power.

    Today, the most wealthy area in the nation isn’t Detroit, where they used to produce and sell cars that gave everyone a better life; Hollywood, where they produce and sell movies and entertainment that give everyone a better life; or the Silicon Valley; where they produce and sell technology that give everyone a better life, it is the areas surrounding Washington DC, where they produce and sell influence to benefit the powerful (the Reids, Pelosis, McConnells, Bidens, Boehners, and Cheney’s of the world) at the expense of the common good. I’m not for that.

  • Anonymous

    This recalls what I wrote above about the flaw in progressive thinking. Progressives think individuals are too flawed to be left to their own devices and need government regulation/supervision. But the government is made up of similar individuals- except with tax collecting authority, law enforcement,and military might at their disposal.

  • linerider

    It’s odd that the chart shows the top 1% paying the highest tax rate, when most of their income is taxed at only 15% (cap gains/dividends). Unless this chart is just for salary/royalty income, which would be *extremely* misleading.

  • Anonymous

    They still pay the highest rate, but I bet that the federal rate is based on taxable income. Since the top 1% also receive the highest percentage of tax breaks, their taxable income is actually much lower than their total income.

  • Michele Hogan

    Yes, I was also a little puzzled to see Slovakia, where I lived for ten years, listed as taxed at a 28.3% rate, when I know it is 0 for incomes up to minimum wage, and then 19% for money earned over that amount – absolutely fair, absolutely predictable, doing the forms takes 10 minutes of your time once a year. Then I realized that the tax table above INCLUDES health insurance and social security payments, which are made to the government, and figured along with taxes. Include what Americans pay for health insurance, and we will move way, way, way up on that table!

  • Mark Melnicoff

    Guess what, Kev… It’s true! Do you think laws and regulations came into being (most notably with the advent of the Industrial Revolution) because people in government decided that they wanted power and control? Hell no! They came about to address real abuses on the part of individuals! You name it, everything from food safety to financial regulations to industrial safety to environmental laws and regulations came about because of REAL adverse impacts being imposed on innocent people because of the practices of “greedy people”. It’s all there in the history books. No one wants to impose another law or regulation just because. I worked in government, and the more complicated the rules become, the harder it is to perform your job as a regulator. Who needs that? Unfortunately there is always someone else out there trying to “game the system”, which eventually causes “the big, bad government” to have to create yet more rules and regulations to curtail yet another abuse. (e.g. – This is becoming, of late, a huge problem in cyberspace.) There is a real cultural problem in this country as people seem to be taking on more and more of a “Wild West” attitude about life and our society. The USA as depicted in the famous Norman Rockwell illustrations seems to be a bygone thing. So what’s your answer – Let’s cancel all regulations and drift toward anarchy? You think anarchy is freedom?

  • Mark Melnicoff

    And you know for a fact that these 5 families all had good paying jobs in their former states, but decided to give that up and move to Texas because the tax rate is lower there, not knowing what their employment situation might be??

  • Anonymous

    You should take a close look at the tax code and the federal budget. Doing away with, say, the Department of Education, would hardly lead to anarchy. Education isn’t a constitutionally federal responsibility (nor is much of what our taxes are used for). I’d venture to say that the whiplash of federal money and programs being modified to benefit the supporters of who is in power, only to be eventually overhauled to benefit whoever comes next, is a lot closer to anarchy than, say, foregoing “cash for clunkers”, one of many examples of a program that didn’t benefit the country, but benefited well connected donors and individuals.

  • Mark Melnicoff

    Most of our taxes go to 3 major categories: Social Security, Medicare/Medicaid, and Defense. They alone constitute around 70% of the federal budget. Only Defense is explicitly mandated, but under the Preamble, these other areas of federal government support are not prohibited, but are somewhat suggested as appropriate, if needed (e.g. – “promote the general welfare”). Such needs were identified as we “came off the farm” and started to live in urban settings. Education, on the other hand, only consumes about 2% of the federal budget. So unless you can prove that the Dept of Education is not doing anything useful, eliminating this agency will not save much money, and thus cannot really be justified. Of the two large categories not explicitly mandated in the Constitution, they are so well-entrenched, and have done wonders in keeping our seniors in good stead, I’d venture that repealing the implementing laws for these programs would tear the country apart. Having said that, it is clear that the trajectory of cost increase for these programs needs to be bent downward, as they are not sustainable. Since we have some predictability with the growth of their costs (especially Social Security), there should be a good selection of remedies that result in a relatively uniform sacrifice from both taxpayers and beneficiaries. This is what we should be working on, rather than ranting on about how we need to dismantle programs that help people who are unable to provide for themselves.

  • DublinJohn

    We all seem to agree that trickle down economics has been a flop and that the wealthy have too many ways to expense or defer taxes while the rest of us are stuck at the mercy of our limited salaries. What is even more important though is that we as citizens are losing our status as “owners” of the system of government and are turning into just consumers and tax cash cows. But the system of commerce is rigged too. Deregulation was used to curb the ability of state, local gov and individuals, subsidies are now “routine” and typically go to only the largest of corporations who line up for them like sharks. And when our economy collapsed because the powers that be also moved oversight and regulatory protections… instead of splitting up and selling off the failing banks… they were declared too large to fail and tax payers bailed them out. In a sense our Fed Gov encourages tax cuts for even outsourcing jobs… as if having workers from other countries replacing American jobs here… and even protects those who are here illegally by ignoring the fact their visas have expired. We need to dump the leadership and work on a real free market and less lobbyists writing all our legislation.

  • Anonymous

    a former friend works for the IRS, they can’t give any personal information, but they admitted that it is not uncommon for millionaires to end up paying ZERO dollars in Federal taxes.

    While I pay 28% because I needed to keep my money in the budget and not in various loopholes in order to support my kids.

  • Anonymous

    Bush-the-elder called it “voodoo economics” and he sure was right.

  • Lyn Wilson

    A “progressive” tax system means that, as one’s income increases, they pay a progressively larger share (rate) – - at least, that’s the theory. So – rich guy making $250K/year pays exactly the same rate on his first $25K as does the guy making only $25K/year; he pays the same rate on his first $100K as does the guy making $100K/year, etc. His rate progressively increases. It levels off at about $1MM/year.
    Social Security tax is not progressive – -every wage earner pays into the system at a fixed rate (~2.5% of income) up until your income reaches $115K/year. Anyone making over that amount does not pay any more into Social Security. Social Security payout is progressive in a sense, as the monthly payout is based upon your average income and years worked.

  • Lyn Wilson

    Suppose you work for XYZ Corporation. You are a radical right-winger, as are most of your co-workers. However, XYZ makes a huge campaign contribution to Obama, or Bernie Sanders. How has the corporation – acting as a person – fairly represented the “association” of workers who have contributed positively to its bottom line that made the contribution possible in the first place?
    A corporation is not an association of like-minded persons combining resources to reach some common goal. A corporation is a legal creation, whose sole duty is to provide a profit for shareholders.

  • Lyn Wilson

    Defense spending is not mandated – “provide for the common defense” does not translate into “spend more on your military than the next closest 24 countries combined” (22 of whom are allies)

  • Mark Melnicoff

    Not sure what your comment is driving at. My comments above are trying to make the point that even if we eliminate some (or all) of the “silly Federal programs” that are not explicitly specified as a federal constitutional function, that would hardly make a dent in the deficit and in many cases actually do some good. I was making specific references to many of the federal regulatory programs that the previous blogger felt was federal overreach (and beyond what the Constitution calls for) because people in government don’t trust “the people” to do for themselves. My original point was that in the vast majority of cases, there was good reason to create these regulatory programs to address abuses that had actually occurred. To me, the debate on “how much defense is enough” is a completely separate topic.

  • R Andrews

    Not so – the OECD represents European tax rates well but fails to take into account US state and city tax income rates, the affordable care tax and property taxes which means US taxes are effectively higher in total to individuals. Couple with this that the US is the only country listed which taxes its citizens and companies worldwide – not based on residence or where income was earned- which means if they live or work outside the US as individuals or companies operate ouside the US, they pay taxes to 2 countries- insanely unjust and uncompetitive – which is why many Americans and corporations are opting to shed their US citizenships ( individual or corporate)..;.

    Comparing the US to UK and thinking the US tax rates are ‘competitive’ in this world is like comparing rents in economically challenged Scranton Pennsylvania and Watts California and thinking you only need the same net income to live and work in an economic vibrant place like New York or London.. Time to wise up on economics. Investment, opportunities and wealth creation are strongly correlated to net income – whereas poverty and economic stagnation follow high, suffocating taxation.

  • R Andrews

    No it does not – taxes are effectively higher in the US and comparing them with Europe on an equal basis is not comforting – The EU ( Europe’s) middle class is fast dissapearing given all the years of high taxation, costly entitlements to poorly provided health care, unemployment benefits,university education and pension systems near bankruptcy…..time to get America competitive again so that investment, jobs and a future for the middle class is revived – the past 14 years have been a disaster – particularly the past 6.

  • R Andrews

    The problem in the current system has nothing to do with social security – the problems there have to do with an ageing population drawing more down as those paying decline – a simple adjustment to moving the first year of entitlement to reflect this ( proportional to the average age when it began) plus means testing ( it was designed to keep retirees from destitution – not as a pension supplement) should do it.

    As far as income taxes – the problem lies in that those on the bottom 30 percent pay nothing in ( no ‘skin in the game’) and those on the top angle for special deductions bringing their effective rates lower….A simple flat two tier tax rate without deductions could solve this -

  • Anonymous

    Aynal Rand? Your hero? Libertarian? Am I close?

  • R Andrews

    No – not close. Just an objective payer of taxes in Europe and US disillusioned with the nativity and thinking that taxes produce anything more than big inefficient outcomes and redistribution to political party friends….

  • R Andrews

    No Karen- I am telling you and all what is missing and that finding solace in comparisons to high tax countries in Europe will get you exactly where they are – in dire financial situations with no growth, high unemployment and declining middle classes, youth without jobs and an ageing population that will never see the pensions promised due to government pension debts beyond repayment and funding. This is the said truth in the Europe where I live.

  • Anonymous

    Still sounds like I am on the right track.

  • Anonymous

    Yeah, that must be why 7 European countries score higher on the Human Development Index than the US.