I would disagree with you. I do plenty of returns that would fit into the top 1% category, and even more if you look at $250,000 plus. Not one makes even 10% of their income from Capital Gains in a typical year. I do have people who make a lot less, that live of Captial gains/Dividends, and while they have a substantial amount of wealth, their income range from $30,000 - $150,000 in a typical year. I'm sure for the majority of billionaires, you would be correct. People like Warren Buffet are the ones in the news, but that doesn't mean that is the norm.
I never said it was the norm, but it is a fact that those people (and there are a significant number of them) pay a much smaller percentage of their income in taxes than someone in the middle class. You do the returns for the working 1%, I highly doubt you see many from the investment class, they get their returns done with the Big Three.
Of course they do, but they don't make up most of the top 1%. They may make up most people in the top 0.1% (I can't be sure), but definitely not the majority of the Top 1%. I'll even throw you out some examples from last year (Rounded numbers): $590,000 AGI, $450,000 Taxable Income, $162,000 Tax(includes 20,000 self-employment tax), 36% effective rate $580,000 AGI, $460,000 Taxable Income, $150,000 Tax, 32% Effective Rate My return last year: $36,604 AGI, $10,518 Taxable Income, $0 Tax, $800 Making Work Pay Credit, $1,842 EIC, $2,000 Additional Child Tax Credit, -44% Effective rate There is a problem with the Capital Gain/Qualified Dividend rate. There is certainly a problem with the tax rate of the ridiculously wealthy. Honestly, I think there is a problem with me getting so much money free from the government, just because I'm married with children. Its just hard to turn them down. Reagan, Obama and W, are each responsible for one of my refundable tax credits. I have more fault with W (Which was to raise and make refundable the child tax credit, IIRC), because at least the other 2 are in part to offset the FICA taxes you pay, and reduce the tax burden on the working poor. If you ask me, I would worry more about the deductions that allow us to get from total income to taxable income, than I would about the rates. Our system screws over middle class singles with no children, and no mortgage. Absolutely rapes them, IMO. I'm actually agreeing with what you are saying, I just think you are using too broad of a brush. I've mentioned on this board plenty of times now, that I am actually in favor of raising taxes. I just think the changes need to be big changes, rather than just significantly raising the taxes on those households over $250,000 (this last sentence not directed at you, but rather at the President's plan).
The part you left out was all of the taxes other than federal taxes, most of which are highly regressive, skewing the numbers further in favor of the wealthy. I wouldn't mind at all going back to pre-Bush levels for all Americans if we are to keep the income tax. Personally, I am more in favor of scrapping it in favor of a consumption tax, but that's just me.
Maybe you didn't read the quote....at all? If you did, then you know zero of the points you are trying to make makes any sense. I guess I hope when I get old I still value the ability to read *sigh*
Saying the rich guy isn't paying for the roads, education, community services is exactly what you would call ignorant. If it's not, get out a dictionary, please.
I only did income tax (and broke out self-employed tax) because that is what we were discussing. I don't mind the sales tax (assuming grocery is exempt from state sales tax), but I'd be in favor of changing the way we do FICA taxes. I think they should lower the rate, remove the cap, and allow x number of wages to be exempt. In turn the government would remove EIC. Of the taxes I hate the most, it is property tax. I hate being taxed on owning something.
Ron Paul’s budget cuts put U.S. on right track JACOB SULLUM jsullum@reason.com Last Modified: Oct 19, 2011 02:12AM Next month, the Joint Select Committee on Deficit Reduction, a 12-member subset of Congress that Congress created to make the hard fiscal choices Congress has failed to make, is expected to propose $1.2 trillion in cuts from projected spending during the next decade. This week, Rep. Ron Paul (R-Texas), who is seeking the Republican presidential nomination, unveiled a plan to cut nearly that much in 2013 alone, followed by similar cuts in the next two years, yielding a balanced budget by 2015. The contrast between the so-called super committee’s goal and Paul’s plan shows how pathetic official Washington’s gestures of fiscal responsibility are. Paul’s detailed numbers refute the myth that the budget cannot be balanced without raising taxes while challenging his opponents to put up or shut up. Paul’s plan not only extends the tax cuts enacted under the Bush administration; it reduces the corporate tax rate from 35 percent to 15 percent while abolishing taxes on inheritances, capital gains and personal savings. It nevertheless manages to eliminate the budget deficit within three years, largely by reducing military spending; capping most programs at 2006 levels, converting Medicaid and other welfare programs into block grants, and eliminating five departments: Commerce, Education, Energy, Housing and Urban Development and Interior. As USA Today noted, Paul is “a longtime critic of federal spending not authorized by the Constitution” — a description that applies to sadly few members of Congress . Yet Paul’s plan would not return the country to the 1990s, let alone the 19th century. It calls for total outlays of $2.9 trillion in 2015, which is about as much as the federal government spent as recently as 2003, adjusted for inflation. You may not agree with Paul’s priorities, but he has laid them out for all to see. Meanwhile, the vast majority of his fellow legislators continue to pretend there is no need to prioritize at all. Consider military spending. Counting savings from ending the wars in Iraq and Afghanistan, Paul calls for $832 billion in cuts over four years, which would leave the Pentagon’s base budget in 2016 about 2 percent lower than it is now. Defense Secretary Leon Panetta, backed by both Republicans and Democrats, insists cuts of that magnitude would be “catastrophic.” Gen. Martin E. Dempsey, chairman of the Joint Chiefs of Staff, warns that “indiscriminate cuts” would cause “potentially irrevocable wounds to our national security.” Indiscriminate cuts may be undesirable, but so is indiscriminate spending, which is what we have now, with the United States accounting for more than two-fifths of the world’s military outlays. Budget choices should drive strategic choices, since we can no longer afford to squander defense dollars on projects that have little or nothing to do with defense, whether it’s launching optional wars or protecting rich allies that are perfectly capable of protecting themselves. Paul’s proposed abolition of various departments, agencies and programs likewise should stimulate debate about the federal government’s priorities. Aside from carrying out the decennial “enumeration” mandated by Article I, Section 2, does the Commerce Department do anything that is constitutionally authorized, let alone essential? What about HUD? Is transportation security properly handled by the federal government or, as Paul argues, by the property owners whose interests are at stake? These are the sort of questions presidential candidates would try to answer if they were truly determined to get our fiscal house in order.
