There seems to be a lot of misinformation about who pays taxes and who doesn’t. According to the Taxpayers Union, in 2009, the top 1 percent of taxpayers paid 38 percent of the total federal personal income tax, the top 10 percent paid 70 percent and the bottom 50 percent paid about 3 percent. The bottom 40 percent pays no federal tax at all. In addition, people in the upper brackets pay most of the state income taxes.
Politically, we have reached the tipping-point where the majority of citizens with no tax-burden at stake will vote for the politicians that promise them more by advocating taxing the “rich.” Often forgotten is the fact that rich people are the ones that create jobs for the rest of us. If we take away the incentive to make money by means of high tax rates, people with talent will just ease back and not work so hard. In the process, they will create fewer jobs and high unemployment will be the norm.
Solving our budget problems by inordinately taxing the “rich” seems to be gaining in popularity so, perhaps, there is no way to keep our financial system from crashing. It won’t happen right away, but unless we change the way we think, and behave it is inevitable! Perhaps we should get weary of the rhetoric, let the high-tax-rate advocates raise taxes as much as they desire, and see what happens.