Fair Share

                Barack Obama and other liberals and progressives continue to harp about “the rich” do not pay their “fair share.”  I do not think they really believe this to be true; therefore, they are doing it to push their agenda.

                The Congressional Budget Office (CBO) makes an annual report on how income and taxes are distributed in our nation.  It recently released its annual report on “The Distribution of Household Income and Federal Taxes,” which analyzed data through 2011 on American households.  The report is 39 pages long and contains much information and many charts.

                Mark J. Perry at the American Enterprise Institute posted a summary and explanation, along with numerous charts.  He wrote that the CBO report contained  a) average `market income’ (a comprehensive measure that includes labor income, business income, and income from capital gains), b) average household transfer payments (payments and benefits from federal, state and local governments including Social Security, Medicare and unemployment insurance), and c) average federal taxes paid by households (including income, payroll, corporate, and excise taxes)….”

                As his “bottom line” Mr. Perry wrote:  “We hear all the time from President Obama, Warren Buffett, Robert Reich, and various other Democrats and liberal pundits that `the rich’ aren’t paying their fair share and need to be taxed more.  For example, last year Obama reiterated his belief that the wealthiest Americans still aren’t paying their `fair share’ of taxes.  He said, `Obviously, there is still more to do when it comes to reducing our debt.  And I’m willing to do more, as long as we do it in a balanced way that doesn’t put all the burden on seniors or students or middle class families, but also asks the wealthiest Americans to contribute and pay their fair share.’

                “The CBO study released this week provides ample evidence that the richest Americans are paying their `fair share’ of federal taxes.  In fact, the richest 20% of Americans by income aren’t just paying a share of federal taxes that would be considered `fair’ – it goes way beyond `fair’ – they’re shouldering almost 100% of the entire federal tax burden of transfer payments and all other non-financed government spending.  What’s probably not so fair is that the bottom 60% isn’t just getting off with a small tax burden or no tax burden – the bottom 60% are net recipients of transfer payments from the top 20% to the tune of about $10,000 per household in 2011.  So maybe what the CBO report shows is that we should be asking whether or not the bottom 60% are paying their fair share when they’re not paying anything – they’re net recipients of transfer payments that come from `the richest’ 20% of American households.  When the top 20% of US households are financing almost 100% of the transfer payments to the bottom 60% and financing almost the entire non-financed operating budget of the federal government, I’d say `the rich’ are paying beyond their fair share of the total tax burden, and we might want to start asking if the bottom 60% of `net recipient’ households are really paying their fair share.”

                Blogger Micheal Hausam  used the information from the CBO report and the American Enterprise Institute to come to the following conclusions.  These simple statements show who is really paying their “fair share.”  (1) The top 1% of households earned 15% of income but paid 35% of federal income taxes.  (2) The top 20% of households earned 52% of income but paid 69% in federal income taxes. 

(3) The bottom 20% of households’ income tax rates dropped from 9% to 1.9% since 1984.  (4) 40% of households get more than half their income from federal transfer programs.  (5) When government transfers are included, 60% of Americans had net negative tax rates – meaning they received more than they paid in.

                I believe that “the rich” are paying more than their “fair share” of taxes.  Our progressive income tax laws will always make it so.  I believe our country would be much better off – and the wealth would spread further – if all Americans paid something for the blessings and liberties of this great nation.  If God can run his kingdom on a tithing of 10% of the income of every member, then the federal government should be able to run our country on approximately the same amount of the income of all households.  The flat tax is looking better and better to me!