Wednesday, November 16, 2011

First World Problems: Taxes Pt. 1

Lately every complaint that comes out of my mouth needs to be followed with the disclaimer, "first world problems." Honestly, maybe every complaint I've ever uttered needed that disclaimer, or it's sister disclaimer "white girl problems."

Source: The Economist Online, Sept. 29, 2011
There is a significant portion of the population right now that complains about taxes, and I have no sympathy. As U.S. citizens, we don't really pay that much in taxes. Based on a benchmark income of $100,000 per year, our friends in Belgium, Greece, Germany, France and Denmark have an effective tax rate nearly double that of the U.S. Our federal income tax brackets range from 10 percent to 35 percent. That top rate, applicable to individuals making approximately $380,000 and more, is unbelievably distant from the  top tax rate we've ever had: 94 percent in 1944, for people earning over $2.5 million in 2011 dollars. 

Now, don't get me wrong, 94 percent is a ridiculously high tax rate, in my humble opinion. Between the end of World War II and the beginning of Reagan's presidency, the largest tax cut was ushered in by (Democratic) President Kennedy, and the top tax rate was reduced to 70 percent. Gradual cuts over the years have reduced the top rate to 35 percent, and the poorest people in our society end up paying nothing because, in short, taxing someone on a nonexistent or nearly nonexistent income is a joke.

On top of our comparatively and historically low tax rates, this isn't even the real percentage that some people pay. And the richer a person is, the more ways they have at their disposal to decrease the actual percentage of income paid in taxes. The top 400 richest Americans actually pay about 17 percent of their income in taxes, which, as Tim Dickinson recently stated in Rolling Stone, is five percentage points less than a bus driver earning $26,000 a year.

This is not  how a graduated income tax is supposed to work. We'll be discussing taxes more and more over the coming weeks. Get. Excited.

But for now, tell those ungrateful Tea Partiers and the so-called "53%" to sit down and shut up.

For further reading:

Wednesday, November 9, 2011

The Twitter

Happy To Be Blue is now on the Twitter, tweeting super insightful comments about the luxury of being liberal. Follow me @happy2beblue.