Nice graph

May 25, 2009

Cool graph from Strategas Research Partners via Ritholtz, is a good reminder of two things:

  1. Just how much LESS the top 1% earners are paying in taxes right now than historically.
  2. Just how stable federal spending has been, around 15% to 22% of GDP since the 40’s until the 2000’s (I assume this is due to the Iraq war and maybe prescription drug benefits).  This is a much better way to look at it than in dollar terms, which is what small-government advocates always use.

2 Responses to “Nice graph”

  1. still thinking of one Says:

    1. The top tax bracket and top 1% are far from the same thing. The top tax used to apply to a much smaller % of population who largely avoided paying though various tax shelters. A better graph would be the amount of money contributed by top 1% of earners as percentage of total tax rolls.
    2. Federal spending rose from about 12% post WWII to almost 30% right now. How is that stable?

    • maristi Says:

      1. I reject this completely. This is in fact the measurement used most often by the anti-tax pundits and is very misleading. It is irrelevant how much the top 1% earners pay in absolute terms. By that rationale they could earn 99% of the income, and still pay only 50% of the total tax burden, because “it’s so unfair for 1% to carry the majority of the load”. It’s a Red Herring.

      Oh and tax shelters are alive and well. Especially for top 1% earners. See UBS. That’s just the tip of the iceberg.

      2. From 15% in 1950 to 20% in 2005. 5% increase in half a century. Yes, that’s pretty stable. I wasn’t very clear I guess, I wasn’t counting Bush’s two mismanaged wars and his handout to the drug companies since then.

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