I do not know if the following from the most recent “Bernie Buzz” can can be attributed to demagoguery, or to just plain ignorance:
It’s a scandal, Bernie told colleagues today. “We have a deficit problem. It has to be addressed, but it cannot be addressed on the backs of the sick, the elderly, the poor, young people, and the most vulnerable in this country. The wealthiest people and the largest corporations in this country have got to contribute.”
The notion that the deficit is being addressed “on the backs of the poor, etc.”, is a familiar Bernie claim, but it does not hold up to scrutiny. The simple fact of the matter is that the higher income groups pay a much higher percentage in income of the tax burden than do those of the lower income tax brackets. As an article in the American Enterprise Institute Journal points out:
“The latest data show that a big portion of the federal income tax burden is shoul dered by a small group of the very richest Americans. The wealthiest 1 percent of the population earn 19 per cent of the income but pay 37 percent of the income tax. The top 10 percent pay 68 percent of the tab. Meanwhile, the bottom 50 percent—those below the median income level—now earn 13 percent of the income but pay just 3 percent of the taxes. These are proportions of the income tax alone and don’t include payroll taxes for Social Security and Medicare.”
The notion that tax cuts somehow favor the rich holds up no better to scrutiny:
“The New York Times reported recently that the average family in America with an income of $10 million or more received a half-million-dollar tax cut, while the middle class got crumbs (less than $100 shaved off their tax bill). If we examine the taxes paid in a static world—that is, if we assume that there was no change in behavior and economic performance as a result of the tax code—then these numbers are meaningful. Most of the tax cuts went to the super wealthy.
But Americans did respond to the tax cuts. There was more investment, more hiring by businesses, and a stronger stock market. When we compare the taxes paid under the old system with those paid after the Bush tax cuts, the rich are now actually paying a higher proportion of income taxes. The latest IRS data show an increase of more than $100 billion in tax payments from the wealthy by 2005 alone. The number of tax filers who claimed taxable income of more than $1 million increased from approximately 180,000 in 2003 to over 300,000 in 2005. The total taxes paid by these millionaire households rose by about 80 percent in two years, from $132 billion to $236 billion.”
Finally, there is the claim that tax cuts have shifted more of the burden of paying taxes onto the backs of the poor. Here is what they had to say about that:
“No. I examined the Treasury Department analysis of how much the rich would have paid without the Bush tax cuts and how much they actually did pay. The rich are now paying more than they would have paid, not less, after the Bush investment tax cuts. For example, the Treasury’s estimate was that the top 1 percent of earners would pay 31 percent of taxes if the Bush cuts did not go into effect; with the cuts, they actually paid 37 per cent. Similarly, the share of the top 10 percent of earners was estimated at 63 percent without the cuts; they actually paid 68 percent.”
The moral of the story is to fact check politicians engaging in demagoguery.