In 2007, those in the top 1% controlled 35% of the national net worth while the bottom 80% of the nation controlled only 15% of the nation’s net worth. In terms of Financial wealth, the top 1% controlled 43% of the nation’s wealth while the bottom 80% only controlled 7%
What’s sadder is that tracking of both net worth and financial wealth in the United States from 1983 through 2007 shows a steady decline for the “bottom 80%.” This study was compelling and enlightening:
http://www2.ucsc.edu/whorulesamerica/power/wealth.html
I bring this up because recently I was watching a Right-Wing talking head discussing the push to have the upper class pay higher taxes to address the nation’s deficit and he was citing the fact that they already pay an extraordinary amount of the Federal Taxes, both is terms of amount and percentage. I didn’t doubt his figures, but he left something off. Those at the top already control the majority of the nation’s net and financial wealth. They enjoy the benefits of the nation and it seems only fair to me that they pay a higher share of keeping this country running. And beyond that, despite the ever shrinking control of the “bottom 80%” control of the net and financial wealth of the nation, they actually pay a higher percentage of overall taxes than do the upper 20%.
Many on the Right complain that the bottom 50% do not pay Federal Income tax. I would be remiss not to point out, as everyone should understand, that although the bottom 50% do not pay Federal Income, they still pay FICA, that funds Social Security, Medicare and Medicaid. In fact all of their income is subject to that tax unlike the upper classes, who after they earn $106,800.00, do not pay a single cent more in FICA. And of course the bottom 50% have a higher percentage of their total income/worth that is subject to Sales, State, City, County, Property taxes than those at the top. So if we’re going to talk about tax fairness, let’s look at it from a fair perspective.
Here are interesting figures I pulled from the Internet:
http://ntu.org/tax-basics/who-pays-income-taxes.html
These are simply charts, so you can apply this as you see fit. I see fit to try to apply it to how much the upper percentile of people pay in Federal Income Taxes compared to what they control and compare that to the lower. Going to the chart for Tax year 2007:
Tax Year 2007
|
Percentiles Ranked by AGI |
AGI Threshold on Percentiles |
Percentage of Federal Personal Income Tax Paid |
|
Top 1% |
$410,096 |
40.42 |
|
Top 5% |
$160,041 |
60.63 |
|
Top 10% |
$113,018 |
71.22 |
|
Top 25% |
$66,532 |
86.59 |
|
Top 50% |
$32,879 |
97.11 |
|
Bottom 50% |
<$32,879 |
2.89 |
|
Note: AGI is Adjusted Gross Income Source: Internal Revenue Service The top 10% paid 71.22% of Federal Personal Income Tax. That same 10% group controls 73% of the Nation’s Net Worth and 82% of the Financial Wealth Distribution. Conversely, the lower 90% paid 28.78% of Federal Personal Income Tax, but only control, 27% of the Nation’s Net Worth and 18% of the Financial Wealth Distribution. What I find interesting about this comparison is that in terms of “Net Worth” the percentages are actually fairly close, which indicates that neither side is significantly over or under paying Federal Taxes as it relates to their Net Ownership in the County. However, when looked from the perspective of Financial Wealth, in other words cash on hand, the upper 10% pay significantly less than what they have in cash, compared to the lower 90% paying more in Federal Taxes than what they have “cash on hand.” I find this interesting because we know that since the Crash of 2008, more and more corporations and those in the 1% have been “hoarding” their cash, keeping it out of the economy. It’s the cash they have that isn’t going to Federal Income Taxes while the lower 90% are paying cash they don’t have for taxes. So, from that perspective, the upper 10% would appear to have it pretty good compared to the rest of us. Broken down to the infamous 1% for Tax Year 2007, they paid 40.42% of total Federal Personal Income tax while at the same time controlling 35% of the Net Worth (admittedly looks like they are being screwed here) but also controlling 43% of the Financial Wealth of the Nation, just slightly below. Again, what are the numbers since 2007 when they started hoarding more of their money? To sum up, I don’t see the upper 1% or even 10% paying far more than their fair share of taxes. In fact, looking at trends, they could probably pay a bit more. At the very least, they wouldn’t miss it. However, the lower percentile of people are getting screwed in terms of their tax responsibility compared to what they actually have to show for it. Regardless, Federal Tax Revenues in relationship to Expenses must be increased. If deficits are a problem as both sides seem to agree, then the only way to pay it down is a combination of both spending cuts and revenue enhancements. The lower classes already pay more than their fair share. In fact, any increase on them does have a direct impact on their standard of living. The upper 1% or even 10% can actually pay significantly higher percentages of their wealth to pay off the debt and it still wouldn’t have any significant impact on their standard of living. The lower percentile people have already sacrificed wages, benefits and government social safety service in an attempt to get out of a financial mess created by the unregulated banksters at the top. Since the crash, not a single sacrifice from the upper 1%, in fact, they’ve gotten richer in the deal. If fair is fair, it’s time for the 1% to give in and help out to get the deficit under control and stop blaming it on the lower classes and expecting them to clean up a mess they did not make at all. |
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