Here’s a hypothetical. Let’s say we send nine blondes and one brunette into a room and we ask each of them to say something really stupid. Then we conclude from the experiment that blondes are nine times more likely to say something stupid as brunettes. You cry foul? You think we rigged the statistic by creating conditions that would make the statistic come true? Well, you would be right.
Last Saturday morning on MSNBC, Chris Hayes, host of the new weekend program “Up with Chris Hayes” proved that very point when it comes to the GOP’s favorite statistic that the top 10% of wage earners pay 70% of all taxes. As Hayes noted, the statistic is ridiculous on its face since it does not take into account payroll taxes, or state and local taxes. Be that as it may, he goes on to prove the emptiness of the meme even if we zero in on Federal income tax.
He invents a fictional country named Inequalistan, a tiny little nation with a population of 10. Nine of its citizens make $10.00 a year. The tenth citizen makes $100.00 a year. Believing a progressive tax to be unfair, Inequalistan imposes a 10% flat tax on all its citizens. As a result, the country collects $19.00 per year in taxes. If you do the math, $10.00 of this revenue is coming from the rich guy. So the rich guy is paying more than 50% of all taxes.
Now here’s the kicker. As Hayes points out, this can’t be the result of “class warfare” because everyone in Inequalistan is taxed at the same rate. Hence the “unseemly burden” borne by the rich guy is the direct result of his unseemly wealth. In other words, in a society where one small class of people can so thoroughly dominate the rest of the country economically, the result of even a fair flat tax will be more money coming from that privileged class. The conservatives who gripe about the rich paying more taxes ignore the advantageous conditions that create that inequity. Or to quote Chris Hayes (the money quote, so to speak), “Conservatives are using evidence of inequality to defend inequality.”Vodpod videos no longer available.
So the next time you hear someone say the top 10% pay 70% of taxes ask yourself why the top 10% make so much more than everyone else that they would indeed be paying 70% of all taxes. Maybe the answer is not to tax the rich less, but to create economic conditions such that more people share in the wealth of the nation.
Picture credit: http://kathleenrooney.com/news/rich-uncle-pennybags/