Tuesday, July 26, 2011

Taxing the "wealthy" more

I just took an online "poll" at my local ABC TV affiliate, WTNH Ch8. I usually don't participate in these mindless "polls". Especially when there's usually 100 folks who participate. Question: "Do you think the wealthy should be taxed more to help balance the current budget"?

First, it's what I call a "stacked" question. It's actually leading a typical person to the answer they apparently want and then will report on at 11PM; long after I'm involved in a silly DTV movie or am long asleep, just waiting for my bladder to wake me up for the first time of three or four. A better question would be, "Are the wealthy, who constitute a mere 2% of the population yet pay 58% of personal tax revenue, paying enough"?

I voted "No" to the original TV question, but would vote "Yes" to my 'better' question. Here in CT, 45% of all state income tax comes from the county I teach in, Fairfield. Even though it constitutes 13% by land area (625/4845 sq mi) and 25% by state population (916K/3575K). So, roughly 1/4 of CT's population are paying 1/2 CT's tax revenue. Doesn't seem mathematically fair to me. However, wait till you see the National numbers! Oh, what a ride this is!

Before you attack me, I don't live in Fairfield County. I can't afford it. I'm only a retired teacher, not a businessman or a debutanter, the male version of debutante. I always WANTED to grow up to be an astronaut or a Debutanter, but the military had other ideas in the early 70's... sigh...

If we look at anecdotes, I have a good one for you. Tax year 2010, we (Mrs Daryl & I) paid over $26,000 just in Fed/State taxes. This does not count SS and Medicare and other 'mandatory deductions' (bringing total tax liability to $31,000) and this on a salary of under $100,000. We are hardly "wealthy". A neighbor, a nice guy for sure, boasted more than once that he paid less than $1000 in Fed/State taxes and got back a whopping $4500.00. What? Huh? Eh? Err...? Yet, they makes about the same as we do. Why? He works in a union trade where he is paid cash under the table and his wife is on long-term unemployment benefits. Inequitable? Yep. (If he ever ticks me off enough, I'm calling my friendly local IRS guy...)

If we look at the pure numbers (Who needs numbers? We don't have no numbers! We don't need to show you no stinking numbers!) it's the same old story. In my tax bracket, ~28%, I paid more taxes and claimed less deductions than the others in my bracket, according to Intuit.com, the makers of TurboTax. Average taxes paid by couples who made between 85K and 110K was a mere $11,000. Now, why are they paying less than 1/2 of the amount I pay? No clue. Better accountants, I guess.

You don't subscribe to anecdotes as scientific proof? Good! How 'bout some numbers from the actual IRS:(http://www.taxfoundation.org/news/show/250.html#table8)
1. Folks who make more than 250K (top 5%) per year pay an AVERAGE of 23% of their income in Fed taxes alone. Roughly, each pays $58,000 in Fed taxes!!! That's a full 59% of the TOTAL IRS REVENUE!
2. Folks who make less than 33K (bottom 50%, YES 50%, not 5%) per year pay an AVERAGE of 2% of their income in Fed taxes. Roughly $660 each. That's a full 2% of the TOTAL IRS REVENUE!
3. Notice, the Top 5% are paying more than 1/2 the personal taxes while the Bottom 50% are paying less than 2%. Can you say "WTF?"
If these numbers don't scare you, I'll have to write an post on Advanced Calculus For Engineers and Astrophysicists.

Summary: What the hell ever happened to the American Dream where you study hard, you work hard, and you earn hard. Hard work is supposed to pay off! Not being lazy and entitled. We've worked hard our entire frakkin' life. We've finally reached a point where our income is enough where we don't have to worry about our bank balance before paying for something while away on vacation or in Philly at Citizen's Park. We've finally reached the point where all that hard work is supposed to have paid off; all those extra club advisorships and coaching jobs, all those college courses to earn 4 advanced degrees, all those workshops attended and given in order to step to the front of the teacher "class", all those long hours sitting in the basement "office" (breathing mold and watching mice have sex... YUCK!) trying to perfect lessons and make a better connection with students, all those long overtime hours as a retail manager (at least that's what Mrs T said she was doing...). All that. Now what?

So, what's fair? Each of us pays our fair share. Period. Let's say a fair share is 20%. I'm OK with that. It actually saves me a few $$$. For me, that's about $20,000 a year. For someone making $33K, it's about $6600. Yes, the bottom pays more in $$$. I'm sorry, but that's the way percentages work! Someone making $2 MILLION would pay $400,000. It's a percentage, Kids. This ain't Rocket Surgery... Can you even calculate what Bill Gates would pay? The debt ceiling would be a crap-load easier to figure out!

By the way, the original TV poll is currently 87% agree that the "wealthy" should be taxed more... Of course, 87% of the people in USA don't understand percentages, so I could say anything...

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