If you paid 27.5% of your income then you are a schmuck. Are you including Oregon, or just Federal. My wife and I earn substantially less than the Clintons, though enough to place us in the upper 1% of income earners. I just finished my taxes for 2007 and our effective tax rate was 28.5% of our total adjusted gross income, significantly more than most of the richie riches of the wealthy. We own a home and a vacation home, have investments, and pay nearly $50,000 annually in Oregon income tax. Our property taxes on two places - Clackamas County and Deschutes County amount to about $9000 and both my wife and I max out on Social Security. You aren't gonna get any sympathy from me or any other wealthy folk. I don't have any problem decreasing the marginal rates on fools like you who pay way too much in income tax, but I'm not about to support an increase in rates either. The Clinton tax increases put us about where we thought we should be. The Bush tax cuts only drove us deeper into AMT territory and upped the ante by about 20%. I hate income taxes and I'm not willing to pay a dime more.

My wife and I earn substantially less than the Clintons, though enough to place us in the upper 1% of income earners.

I'm not necessarily disputing your claim, but your comment deserves a question:

What percentage of the population believes they are in the top one percent of earners? I would bet that it's MUCH higher than 1 percent. My guess would be 15 to 20 percent.

Guess what:

15% /=/ 01%

"why is Jeff is fool/schmuck?"

Hmmm, didn't he answer that? right here: "fools like you who pay way too much in income tax"

"I'm not going anywhere with this."

Yep, quite a random post. Or rant. Ranting's okay once in a while. Better that than Kari's shilling, but that's another rant.

Maybe Jeff does not have enough deductions to reduce his tax bill? Do what Clinton's did... donate to their own charitable foundation, then pay out from that foundation donations to key primary cities' librarys. The locals think your magnanimous, and you get a big fat tax deduction, and the middle class gets to pay more in taxes, because it ain't a zero sum game.

<h2>"What percentage of the population believes they are in the top one percent of earners?"</h2>

Around $300K to $500K gets you into the Top 1% I think... about mid-six figures, ie 4 or 5 or 6 then another five zeros afterward.

<h2>"I would bet that it's MUCH higher than 1 percent. My guess would be 15 to 20 percent. "</h2>

Ignorant or delusional. Most people who don't make mid-six figures, don't think that they are in the Top 1%. Certainly not 15 to 20% of ANY population.

Ignorant or delusional. Most people who don't make mid-six figures, don't think that they are in the Top 1%. Certainly not 15 to 20% of ANY population.

Most people don't research the exact numbers that would place them there. People making six figures are most at risk of overestimating their wage-earning percentile. How many people are deluding themselves with the misconception that they are the ones living the "American Dream"?

There was actually a survey recently that showed that much more than 1% of the population believed they were in the top 1% of income in the country.

Jenni - can you provide a link? I've come up dry, though I'm sure concrete numbers exist.

This is analogous to the time a cab driver told my estate attorney uncle how glad he was that the GOP did something about the "death tax," to spare guys like him. Increasingly, people have a very poor understanding of where they fit in the economic spectrum of the country, and where their "pain" fits in the overall context of the collective burden of taxes and the individual burden of having enough to get by.

This is the best link I could find, showing the 2005 income tiers, with those making $364K and above in the top 1%. Using that guide (and assuming $50K state income tax), Mr. Fearless above probably is in that category. And boy, taxes are wrecking his quality of life.

Sorry, here's my link: http://www.ntu.org/main/page.php?PageID=6

Nineteen percent of Americans say they are in the richest 1 percent and a further 20 percent expect to be someday.

Thank you Jenni and Darrelplant for the confirmation. 19% in 2000...it would be interesting to see what the run-up in housing prices have done to this number, considering the fact that most homeowners saw increased valuations as an increase in income. (Lord knows most of them spent like it was an increase in income.)

Most people who don't make mid-six figures, don't think that they are in the Top 1%. Certainly not 15 to 20% of ANY population.

There ya go, smart one. Psychology plays a prominent role in economic study. This is one instance.

darrelplant :wave: from your pals at esch

i'm somebody else there winky wink

I really don't care how much the Clintons made, bully for them. But I do care that he made 800K of it schilling for the Colombian fte that HRC allegedly opposes.

Clintons paid their fair share of taxes at 30%. What are we expecting them to do - be the Mahatma Gandhi of USA, with all due respect to Gandhi. I think its ridiculous to make such comparisons. Why should the rich pay more and poor pay less. I think we all should just pay less in taxes, even though I am a progressive. There is nothing wrong in that. That is what America is all about. I find this double standard revolting. Even Mr. Obama earned over a million dollars and if he gets elected President, I am certain when he is done he will get "richer".

I have a strong opinion about this!

guys the 20% that think they are the 1% was posted right here, on blue o, about 2 mos. ago... i remember vividly

Jeff - doesn't it depend on how you slice the numbers. Forget the effective tax rate and look at what was actually paid. Your salary is .20% less than the Clintons, and the amount you pay in taxes, based on your numbers, is .18% of what they paid in taxes. You're both turning over a fairly equivalent percentage of your money...in fact, you are getting a break. I assume that you are contributing as much as you can to society by doing what you do, and that the Clintons are also giving 100%. So, doesn't this actually seem a bit fair, and isn't the real question about the inequities that exist where people are receiving from the government, that is, are we taking care of the people who need being taken care of as opposed to those who can certainly survive without additional government help?

Why the fixation on the percentage and not the amount? The Clinton's paid $33M in taxes! What the heck do they get for $33M? Basically they paid way, way more than their fair share. They don't use up any more road space or sewer system or police protection than the average person so why should they have to pay such a huge amount of taxes?

The rich people in the USA heavily subsidize the middle class because the middle class refuses to pay its fair share. The top 10% of the income earners pay about 70% of all income taxes.

I misspoke...your salary was .20 % of the Clintons' salary. But, your taxes were .18 % of the Clintons' taxes. So my point remains...the ratio of your salary is almost identical to the ratio of taxes paid, which seems like a fair shake. I'm all for people paying their fair share. I just wish the focus was on whether we spend on people who don't need it as opposed to whether we collect from people who can theoretically give up more. That probably encompasses the same group of people, but it's a slightly different lens for looking at the problem. that is all.

Great post, Jeff. I actually think there is room for a robust debate among progressives about just how flat vs. progressive our tax system should be.

I wouldn't focus, though, on how many government services someone uses in order to determine what is a fair tax. For instance, the argument that the wealthy somehow benefitted more from our "legal, civil, and military infrastructure" may be true in some cases, but not all. More troublesome, such an argument leads to the converse: since poor people use so many direct government services, shouldn't they pay more as well?

Instead, I would focus on the relative value of money. Opinionated, Andy, and Mr. Fearless are off base precisely because they fail to take into account that $1 is worth more to someone making $30,000 a year than it is to someone make $500,000 a year. That's why we should tax higher incomes at a higher marginal rate, because the "cost" to them of paying, for instance, $50,000 in Oregon income tax on a $555,000 yearly salary is actually less than the "cost" of paying $2,700 on a $30,000 yearly salary. Both are taxed at 9%, but the relative value of their money is different.

All of this is separate from the question of whether government is spending money wisely. If we could be more efficient and fund everything we need with half the taxes we currently impose, we should absolutely do that. But if, collectively, we determine that we're not funding enough and need more taxes, those at the top should pay a higher proportion than those at the bottom.

As for Andy's stat about the top 10% paying 70% of the income taxes, he's absolutely right. But what that stat illustrates isn't the progressivity of our tax structure; the stat shows just how well those at the top are doing compared to those at the bottom. Stats like that result from the absurd income inequality that we're currently experiencing.

Back to the top: Income and wealth are not "zero sum", but they are not that far from it. The difference is mostly do to the value of newly exploited [read non-sustainable] resources, in particular, the fossil fuels we have sucked out of the earth in the past two centuries.

Progressive taxation [remember that?] is one way to mitigate the tendency of capitalism to lead to savage inequality. We need other ways as well.

We had better learn this lesson quickly, as non-sustainable economy that feeds the greed of the super-rich is about to crumble around us with devastating consequences: UN warns on food shortage riots

So, Jeff, you included Oregon income tax in that 27.5% of your income... but compared that with the 31% of the Clintons' income paid only in federal taxes. Apples and oranges, eh?

What percentage of your income was paid in federal taxes, so that we might have a more relevant comparison?

If we knock 9% off the top for Oregon (it should be something a little less than that, but it's a starting point) I would assume that your actual federal burden was somewhere on the order of 18-19%?

And, if so, does that include FICA or is it strictly federal income tax? Because according to the IRS tax schedules, if your income is at 30K, the marginal income rate is only going to be 15%. Meaning your effective total rate would have to be less than that.

In short, your numbers just don't add up.

And getting back to the premise of your original post:

The federal budget is a measurable and finite size, and if the rich pay less into it, the poor have to pay more.

The federal budget may be measurable and finite, but it is also variable, which means that to a certain extent if the rich pay less into it -- a number of things could happen. The budget could shrink, for example. Or the deficit (and hence the federal debt) could grow. Or the poor could pay more -- except the "poor" aren't paying in the first place (bottom 50% paying only 3% of federal income taxes, after all), so really the middle class could pay more.

But as others have pointed out, what those who fixate on the relative percentages conveniently ignore is the gross disparity in the actual dollars contributed by the wealthy. Even taking your original numbers at face value (never mind the apples/oranges thing), the Clintons apparently make 500 times your salary annually -- and also apparently contribute more than 560 times your federal taxes (again, it's probably more like 1000 times since you inflated your own burden by including Oregon taxes).

Seriously... you have the gall to complain that somebody who pays in excess of 500 times more in taxes than you, isn't contributing their "fair share"?

Do you honestly believe that they derive more than 500 times the benefits from government, society, etc. than you do?

FIVE HUNDRED TIMES as much???

I don't buy it. They don't have access to 500 times the roads that you do, or 500 times the public education that you do, or 500 times the public parks that you do...

Or 500 times the welfare that you do, or 500 times the unemployment that you do, or 500 times the medicare/medicaid that you do...

And while they might have 500 times the (private) lawyers that you do, they don't enjoy the protection of 500 times the laws, or 500 times the constitutional rights...

Seriously, how about a sense of perspective?

The link you provided to the story on ABC News itself contains a link to the source material, Clinton's press release on the matter.

That release makes it very clear:

What the Clintons' tax returns show is that they paid more than $33,000,000 in federal taxes and donated more than $10,000,000 to charities over the past eight years. (emphasis mine)

So, unintentional or not, you did compare apples with oranges. I'll ask again, what percentage of your income was paid in federal taxes? That way, we can better appreciate the relative progressivity of the system as it stands today... after all, I expect that the percentage the Clintons paid in federal taxes is quite likely double the percentage that you paid (theirs was over 30%; yours, as I stated above, shouldn't have been more than 15% maximum).

By the way, just out of curiosity... can you cite an example of a country with what you consider to be an appropriately progressive system of taxation, which does NOT also have "collected and entrenched wealth, power, and privilege"? Seems to me that most every place in the world has an "elite" of powerful, privileged people who tend to stay that way, for various reasons not really related at all to tax policy. But hey, if you can provide a counter-example, I'm all ears. Or rather, on the internets, I'm all eyes... ;-)

"Do you honestly believe that they derive more than 500 times the benefits from government, society, etc. than you do?"

yes, i absolutely do. their wealth and privilege give them enormous benefit above and beyond the means of the average American.

they move with a literal armada of Secret Service and police protection. you will never see a Clinton (or a Bush or a Cheney) standing in line to use the restroom, buy a coffee, or check out a book from the library (unless it's for a photo-op). if anything, you'll be the one displaced when the Secret Service clears the building for them.

Chelsea Clinton has security which provides easier access to education (public or otherwise) than the majority of middle to lower class. a retinue of bodyguards assures this as well as her social/monetary status. she's not going to be sitting in a hallway with 30 other kids because all the classrooms in her inner city school are filled to capacity.

there is almost a 0% chance that any of them will be the target of day-to-day law enforcement - speeding tickets, loitering, driving under the influence, jay-walking, etc. their wealth and privilege assures that (unless a GOP reporter happens to be in the neighborhood) they will never have to deal with such inconveniences.

yes, occasionally, someone rich gets busted for drugs or drunk driving and it becomes a media spectacle, but this is not the norm for the privileged in America. a cadre of high-priced lawyers would undoubtedly assure that they are not burdened by the stigma of a criminal record.

perhaps they don't use social services. however, those were created to counteract extreme poverty and suffering, not extreme wealth and privilege. the wealthy have a duty as Americans to support them - it's the price they must pay for the enormous benefits they receive.

unless, of course, they need another revolution to remind them of their manners.

To both Darrel and TJ, whether the rich or the poor use more or fewer services is exactly the argument I'm trying to stay away from, because I think it's a loser for progressives. That type of analysis naturally leads to David Wright's attempt to quantify whether paying 500x in taxes what someone else pays is justified since they don't use 500x the services.

Instead, we should focus on people's ability to pay, regardless of whether they use government services or not. And someone making $500,000 a year has a much larger ability to pay a much higher percentage than someone making $30,000. What you pay in taxes should help improve your community and society overall. You shouldn't expect to get back dollar-for-dollar what you paid, nor should you have to pay dollar-for-dollar what you use.

Come on, folks! Think this through. If I have a $200,000 house, I may pay $500 a year for homeowner's insurance. If I own a nationwide chain of hotels, I will need to pay much more for insurance because what I receive is of much greater value. In the same way, the legal system, as well as all the other public infrastructure that support and protect wealth works as least as well for the rich as they do for me. Since the rich have a lot more to protect, they receive much greater value from that tax-supported infrastructure.

Have you ever noticed that law enforcement officers are much more likely to use a baton on a striking worker than on a plant manager or a scumbag union buster?

Spending for corporate welfare programs outweighs spending for low-income programs by more than three to one: $167 billion to $51.7 billion, from: Facts on Corporate Welfare

Need I continue?

Ah, Jeff, usually you're better than this. ;-)

I don't mean to quibble, but do you have anything from a news source?

The source material for your news source isn't good enough? I followed your link to get that information.

I'm not getting further into my own tax records. That's not really the point.

Sorry, Jeff, but you made it exactly the point when you posted about the comparison of how much the richie rich folks pay in taxes compared to your modest income. The gist of your "rant" (as you called it) was essentially that the rich are having a pretty easy time of it because they "only" pay 2.8% more of their income in taxes than you do.

Except as I demonstrated, you weren't using comparable figures in your analysis. I expect that if you did, your analysis would fall apart.

As to more progressive countries--pick your industrialized nation.

I didn't ask for more progressive countries -- I asked which more progressive country doesn't also have an established elite? Your argument was that highly progressive taxation helps to curb entrenched wealth. I'm simply asking you for an example to back up your claim. Where has progressive taxation curbed entrenched wealth?

And here's another angle to look at, with regard to the section of the population that is wealthy. It's true that very rich people have a tendency to stay very rich. And very poor people certainly have a tendency to stay very poor. And middle-class people have a tendency to stay middle-class, though they can easily slip into the poor category, or (admittedly far less easily) climb into the rich category.

The interesting thing about America is that "the rich" is a constantly shifting group from year to year. There are the perennial favorites, to be sure, but there are also a whole lot of people who drift in and out of the "Top X%" category (pick your target).

So a secondary question I'd have for you is what more progressively-taxed country has a higher income mobility than the US? Where are lower and middle income people better able to improve their position?

Of course, I understand that some people believe that the possibility of failure outweighs the potential for success. This is a more "conservative" approach (not in the political sense, but in the "cautious" sense). Others are more focused on the possibility of greater rewards and are thus willing to take more risks. This is just a fundamental difference in attitudes among people, and may be irreconcilable. But to refer back to the numbers cited up-thread -- if 39% of the people think that they either are in the top 1% or will be some day, it's a tough sell to convince people that the top 1% don't pay enough taxes. People fundamentally understand that as they earn more, they pay more in taxes. When they extend that out to the incomes they hope to have some day, and you want those taxes to increase, they're going to think twice about it.

It may be irrationally optimistic, but it's also the reality. That's why people seemingly vote against their economic self-interest -- in part, because they're actually voting for their perceived future self-interest.

<h2>Anyhow... I come back to the basic questions raised by this thread. If rich people should contribute more back to society than poor people, how much more is enough? 500 times more? 1000 times more? Is there such a thing as "enough" taxes on rich people? Who decides, and on what basis?</h2>