“How to Tax Our Way Back to Justice: It is absurd that the working class is now paying higher tax rates than the richest people in America.” (NYT) is kind of fascinating for what it says about our media and taxpayer-funded universities.
Emmanuel Saez and Gabriel Zucman, economists at UC Berkeley, figured out that the “bottom 50%” of Americans earn $18,500/year on average and pay a tax rate of 25 percent.
Here’s my comment on the piece:
I wonder if these guys ever leave their offices on campus.
If they were to walk down to one of the less genteel neighborhoods in their fair city of Berkeley they would discover folks who are living in taxpayer-funded housing, signed up for taxpayer-funded health insurance (Medicaid), receiving taxpayer-funded food stamps, and using a taxpayer-funded smartphone.
Unless you’re going to turn all of these noncash welfare programs into some kind of cash income equivalent, there is no meaningful way to calculate the tax rate paid for an American on welfare. Given that 71 million of us are on Medicaid, for example, the numbers presented in this article cannot possibly be correct. The economists have the “bottom 50%” with an average annual income of $18,500. The income limit for welfare in the writers’ native Bay Area is at least $117,400/year (see https://www.mercurynews.com/2018/06/25/the-eye-popping-definition-of-what-is-low-income-in-the-bay-area-increases-again/ ).
Maybe they found some people with a cash income of $18,500, but that isn’t their spending power. If it were, these folks could not afford to live in the U.S. at all (since, if they have a kid or two, health insurance would consume 100% of their income, leaving nothing for food or shelter).
The truly amazing thing here is that middle class Californians are being taxed to fund these two professors!
The article has a lot of information about how the rich are getting richer.
Since it is obviously absurd to talk about the tax rate paid by people who are mostly living on welfare, what could the purpose of the article be other than to sow discord and rage? (the authors hint that they have been advising Elizabeth Warren and presumably would be on track for central planning jobs if she were to be elected)
Your observations are absolutely correct and easy for anyone to figure out. The authors of the NYT piece are in good company, when I read some of the Krugman articles in the NYT I often wonder if winning a Nobel Price is as difficult as I thought.
I have discouraged my son who is a senior at a top engineering school, and has almost perfect GREs (170 Q 168 V), from pursuing an advanced degree in economics.
It could be argued that to some degree humans live in a world of fantasy. It worries me that the real/scientific aspect of our lives is fast disappearing.
It has been known for some time that envy is the most dangerous (and pathetic) of human flaws — note for example the first real human being, Cain, murdering his brother because of envy and fast forward to the 20th century when over 100m people were killed because of the envy that was the foundation for Nazism and Communism. Half baked academicians can say this and that but it will be interesting to see if the American people buy into the politics of envy in November 2020.
These professors are welfare queens themselves. No wonder they spin their BS to demand more to be taken from productive people – they hope for more of the loot to themselves!
It has been known for some time that envy is the most dangerous …
No, I think bringing up the concept of envy is just a lame way to discourage even discussing the issue of inequality.
The problem is that we don’t censor the media like China and other “less free”’countries do. Even in the 1950’s, we effectively censored our media. Free media in our current form is super-dangerous because it pushes the envy/hate/racism into everyone’s face, and the injustice, and the inequality of the world, and demands we do something about it. The hardest lesson I ever accepted from my father is that the world is never going to be “equal, fair, and just”. Ethically, my father tried “not” to exploit people, but he did say that all social and political systems are exploitative. Even a better idea that is patented is effectively holding the idea back from the general good for your profit. All political systems exploit someone. So he told me, just go figure out how not to be exploited and how to make your “profit” in the world hurting as few people as possible. How can you lust for a Ferrari or Lamborghini is you never see or hear one? How can lust for another partner if the only morality you are taught is monogamy? Maybe there needs to be a lot less information in the hands of the common person, and gates for people to find out about the “exceptions” of the rich. Letting the poor decide equality, and the oppressed dictate social retribution will just cause those who bring the financial and innovative magic to disappear. If I didn’t have 2 elderly relatives to care for in the US, I might already be there.