The Middle Class in America Should Pay MUCH Higher Taxes
For reference, I recommend going to the OECD stats pages and sorting personal income tax rates at each threshold.
https://stats.oecd.org/Index.aspx?DataSetCode=CTS_ETR
Compared to other developed countries, our middle and especially our upper middle class citizens pay VERY low taxes. This shouldn't be surprising, given the common refrain in politics that the "middle class should pay less taxes" which has been argued by both parties for decades.
I grew up quite poor, and at that time I agreed that having the lowest middle class taxes possible was beneficial. Frankly, I just didn't appreciate how well the middle class lives. As a working professional now in my 30's, I see my peers blowing huge amounts of money (compared to my poor friends) on hobbies, dinners, nice cars and many of the other luxuries of life. They have no concept that just miles away from their fancy two-story homes, lower class folks are having to choose between paying their car note and eating for the week.
Also worth noting is that income has serious diminishing marginal utility. People have to spend the first $20k per year or so just to survive. A person who makes $35k per year only has $15k worth of expendable income, whereas a person making $100k has $80k - it's not a three-fold increase in expendable income, it's over a five-fold one.
Some folks might say that we should soak the ultra rich instead. That's fair, since they have the greatest diminishing marginal utility on their money, but frankly, there isn't enough of it. If we taxed everyone in the 1% of American incomes at 100% of WEALTH (not income, wikipedia claims this wealth amounts to $29.5T in 2018) it only pays the bills we currently have for a little less than 8 years. For income, if we took all of their money for the year (~$1.6T) it would pay for about half of the budget. Clearly these people are very wealthy and can afford to pay more taxes, but there simply aren't enough of them to pay for a functioning society.
America desperately needs a better social safety net appropriate to it's wealth. We don't need middle class housewives buying a second Peloton, we need to make sure struggling people aren't fighting to just get by.
Posted Aug 16, 2019, 6:29 PM UTC
Let's destroy middle class and make everyone poor.
It's not like tax money disappears, though, the government sends it right back into the economy, buying things and hiring people which creates demand which creates middle class jobs which increases labor demand and raises salaries.
Pockets of some people.
Other countries' middle classes pay higher effective taxes and they haven't destroyed their economy. This is really just American propaganda that doesn't hold up to the facts.
And I think that they pay too much taxes. The corruption is not that bad there at least, mainly because countries are pretty small.
Is that why other countries arent like America? You know, the worlds richest and most powerful country.
Because they didn't have the advantage of being the general financier of WWII. If they had sucked up half the world's wealth over a decade they probably would have done well for themselves too.
Indeed if they played the game as well as America they would be like America. Very perceptive.
Haha and now we get to charge then for protection. Smart play dummies.