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For the "let’s pay more taxes" crowd
Posted by: McQ on Tuesday, October 11, 2005

You might want to take a look at this:
Governments in the United States take approximately 40 percent of the country's total income in taxes. In other words, nearly half of all the income generated each year is sent to governments to spend.

The good news is that a growing number of people pay no federal taxes at all. According to a recent Tax Foundation report, 29 million people had no federal income tax liability in 2000, and the number was expected to reach 44 million in 2004. The bad news is that people who do pay taxes much pay more to make up for those who pay nothing.

Writes Daniel Mitchell at the Heritage Foundation, "According to data from the Internal Revenue Service, the top 1 percent of income earners pay nearly 35 percent of the income tax burden; the top 10 percent pay 65 percent; and the top 25 percent pay nearly 83 percent. The bottom 50 percent of income earners, on the other hand, pay barely 4 percent of income taxes."
Now none of this is news, nor should it be a surprise. But it does underscore the bankruptcy of the "tax cuts for the rich" argument we hear so much of. And it also underscores the fact that while we are one of the lesser taxed nations on earth, those who do pay taxes still send an inordinate amount of our earnings to the various governments over the year.

And let's be clear ... we're talking about the total tax burden for all government, not just the federal government:
Federal income taxes are only a small portion of the taxes we pay. We also pay federal payroll taxes for Social Security and Medicare, state income taxes, state and local sales taxes, property taxes, death taxes and excise taxes.
Tack on the yearly 'fees' and various and other sundry taxes (ad valorum here in GA) etc, etc, etc, and pretty soon you're talking big money.

So why is government demanding and using so much of our money? Because it is a growth industry and politicians are the ones who drive that growth. Its no longer about what is best for the citizen, but instead, what is best for government. That's a very important change in focus.
The growth of government spending is what makes this tax burden necessary. The federal budget grew 14 percent in President Bush's first three years, with discretionary spending growing nearly 50 percent. The 2006 Bush budget would increase the Department of Education budget by 40 percent since 2001 and the Department of Commerce budget by 85 percent. Bush's 2006 budget was supposed to be an "austerity" budget that finally would rein in spending, but it started with a proposed 3.6 percent increase in federal spending and has taken wing from there. The energy and transportation bills signed by the president are budget busters, and the just-announced spending to "rebuild New Orleans" is likely to make 2006 another record-breaker.
Look at those numbers. 14% growth in the federal budget—under a total Republican administation and Congress. DoE spending up 40%, DoC spending up 85% and that doesn't even begin to account for the Medicare pill bill and the usual pork.

Then there are the states:
Meanwhile, state governments have been indulging in their own spending orgy. Between 1990 and 2000, total state spending grew by a staggering $512 billion, or 89 percent. All of that new built-in spending is moving through today's budgets like a pig through a python, causing state politicians to cry about "budget cuts" even as they reap record revenue increases due to the reviving national economy.
That is phenomenal expansion. 89% growth in the total of state's spending. Again, most states are now under Republican administrations.

The solution? The same as it has always been. Vote them out. Make taxation a theme and vote the violators out. Quit rewarding those who expand government at whatever level. And quit making excuses for those who cave in when they get in office and vote for pork, taxes and increased spending. No tolerance. Be vigilant and stingy with your money ... it is your money after all. That vigilance must be exercised at all levels: local, state and federal.

Republicans have failed miserably (yes, I'm borrowing an appropriate phrase from the Democrats) to curb spending and curb the growth of government. Read the numbers above again. They're disgusting.

And the Democrats really offer nothing better. Read the 5 point plan I posted a week ago. It's all about lip service to debt and deficit and expanding government size and spending.

Based on our recent history, though, it seems both imperative and useless to make this plea to those who vote. We seem to have become so dependent on government that we accept the growth with a shrug and a shake of the head. And while many of us say we want less spending, less taxation and less government, we continue to see those who grow all three areas consistently rewarded with keeping their elected jobs election cycle after election cycle.

The vast majority of us certainly don't treat the money we keep in that manner, but we simply shrug off the 40% which is taken from us by governments and all but ignore how it is wasted. We would never accept broken promises from those we do business with personally, but we all but ignore the broken promises of politicians. And we meekly do their bidding when they ask for more and don't require of them the accountability we would require of anyone wishing to do business with us in our daily life.

It's a strange world we live in, in that regard, and as long as politicians and government suffer no penalty for the amount they take in taxes and how they spend the money, they will continue to demand more, spend more and grow government more.

But sometimes a little historical reminder is in order, especially since government schools usually ignore this aspect of the story:
Our forefathers fought a war for independence over taxes that were far lower than those we now pay without complaint. It's time we got up off our sofas and demanded real tax relief.
I'd expand on that demand. Not only tax relief, but less spending, less government and more responsible use of the money the government does coerce ... or make those responsible for not meeting those demands pay, just as you would with anyone you deal with in your daily life.
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Previous Comments to this Post 

The numbers here offer more support for what I discussed in this article in the New Libertarian. Since many taxpayers at the lower end pay much smaller federal tax rates, 40% of income spent on government translates to a good deal more than 40% of the income of the people who actually pay taxes, particularly the middle class.
Written By: Billy Hollis
URL: http://
So without the Democrats, and without a chunk of Republicans, what are we to do?
Vote LP?

Fiscal conservatives need their own MoveOn.
Written By: OrneryWP
URL: http://
Let’s be a bit more accurate here. Not all taxes are income taxes! Social Security is a highly regressive tax that needs to be figured into the analysis to reflect tax burdens. Sales and property taxes are two others.

Of course, there are the hidden taxes, like the one on nuclear electricity, that are also regressive.

An analysis of just income taxes doesn’t tell the whole story.
Written By: Whitehall
URL: http://
Let’s be a bit more accurate here. Not all taxes are income taxes! Social Security is a highly regressive tax that needs to be figured into the analysis to reflect tax burdens. Sales and property taxes are two others.

Yup, that’s why you’ll find this in the body of the article above:
Federal income taxes are only a small portion of the taxes we pay. We also pay federal payroll taxes for Social Security and Medicare, state income taxes, state and local sales taxes, property taxes, death taxes and excise taxes.
Written By: McQ
Every time someone brings up social security taxes as a way of claiming that there’s been a shift downward in tax burden, I just ask them straight out "then why not abolish them?".

I have yet to get an answer.
Written By: b-psycho
I’m not sure that having more people not pay federal income taxes is a benefit. As more people are not required to chip in, what keeps them from heaping ever higher burdens on those who do?
Written By: Paul
URL: http://
Taxes, ah, let me see. If you retire and file a joint return, and you and your spouse have a combined income consisting of your adjusted gross income + nontaxable interest + ½ of your Social Security benefits equal to more than $44,000, 85 percent of your Social Security benefits may be taxable; 50 percent taxes if combined income is over $34,000. So SS is a tax on your gross income; you pay income tax on SS as part of your adjusted gross income and when you retire with that 401k you sacrificed a bit to ensure maintaining 70% of your pre-retirement income, you have the honor of paying taxes on your SS income. Is this a great country or what!
Written By: Al Reasin
URL: http://
How do you propose to "make those responsible for not meeting those demands pay"?
Written By: sammler
The bottom 50 percent of income earners, on the other hand, pay barely 4 percent of income taxes."
it is your money after all.
And there in lies the problem. It is your money only if you are in the top 50% of earners. Wholly half of the population can vote with glee for expansionist gov’t because they aren’t footing the bill for it. It ISN’T there money after all.

From a coalition building for cutting taxes and spending perspective, it is very important that we have a flatter tax system. A true ’tax cuts for the rich and tax increase for the poor’ that D’s keep claiming we have had but we didn’t. That is one of the reasons I want to see a flat tax. The bottom 50% would still pay very little...but it would be something. Something they could care about. Something they would care about cutting. Right now, fully half of the population, in a democracy, has no personal direct economic incentive to cut gov’t spending.

Written By: blanknoone
URL: http://

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