Pita for the Second Gilded Age

Tear-off pita bread illustrates GOP tax philosophy.

It had to happen:

Closeups June 006.jpg

– tear-off pita bread.

The manufacturer is Danish, but the un-socialist resource allocation clearly reflects the principles that enacted this:

taxcut001.gif

Source: Tax Policy Center; reference year 2004; see the table for the even more remarkable breakdown within the top decile, and the footnotes for methods.

I’ve followed well-established European convention for the chart colouring rather than than its strange American inversion. The working class have always been red, the toffs blue-blooded or white.

Author: James Wimberley

James Wimberley (b. 1946, an Englishman raised in the Channel Islands. three adult children) is a former career international bureaucrat with the Council of Europe in Strasbourg. His main achievements there were the Lisbon Convention on recognition of qualifications and the Kosovo law on school education. He retired in 2006 to a little white house in Andalucia, His first wife Patricia Morris died in 2009 after a long illness. He remarried in 2011. to the former Brazilian TV actress Lu Mendonça. The cat overlords are now three. I suppose I've been invited to join real scholars on the list because my skills, acquired in a decade of technical assistance work in eastern Europe, include being able to ask faux-naïf questions like the exotic Persians and Chinese of eighteenth-century philosophical fiction. So I'm quite comfortable in the role of country-cousin blogger with a European perspective. The other specialised skill I learnt was making toasts with a moral in the course of drunken Caucasian banquets. I'm open to expenses-paid offers to retell Noah the great Armenian and Columbus, the orange, and university reform in Georgia. James Wimberley's occasional publications on the web

8 thoughts on “Pita for the Second Gilded Age”

  1. Well, you can't say he isn't trying hard to provide incentives to all Americans to become wealthy, in order to enjoy those generous tax cuts.
    In Bush's America, we can ALL be in the top quintile.

  2. Anonymous: On the poorest quintile, you are no doubt right that it would be difficult to give them a large volume of of tax cuts; you would need to have large net transfers.
    However, you are clearly wrong to think that the regressive impact of the Bush tax cuts is a necessary outcome of the mildly progressive tax code. If you are cutting tax for Keynesian reasons (fiscal stimulus), a raising of the lowest threshold benefits all taxpayers: high-rate payers benefit more because their marginal rate is the highest, but the benefit ratio would be probably 2:1 or 3:1 between the second and top quintiles, against the actual 10:1. Raising the lowest threshold but steepening the slope (with a slightly higher top rate) allows you to target cuts more efficiently on lower-income taxpayers.
    No, the regressiveness is quite deliberate. If you look at the table, you will see that the average rate of tax is now pretty flat for the top decile and indeed absolutely lower for the top 0.1% than for the merely rich; at the top, the US tax code is no longer progressive at all. Daniel Bernoulli's St. Petersburg Paradox might as well never have been published. http://en.wikipedia.org/wiki/St._Petersburg_Parad

  3. “The poorest quintile gets 4% of income but pays -2% of federal income taxes—negative because most qualify for the Earned Income Tax Credit.”
    Gee, I wonder if that piddly 4% has anything at all to do with the ridiculous minimum wage…..and wouldn’t it be better that they earn their wages from those profiting from their labor, rather than get part of their pay from the rest of us taxpayers who aren’t even getting the benefit of their labor?
    Forcing the rest of us to SUBSIDIZE the labor costs of tightwad employers should be illegal.

  4. Blissex wrote, The tax system extracts more revenue from earned income and consumption etc. than from capital income and investments, and of course the wealthy usually consume a lot less of their income than the poor, and invest a lot more of it.
    Not to mention that the working poor are forced by the government to pay tolls to landowners.
    http://geolib.com/essays/sullivan.dan/royallib.ht

  5. Pretty cute how that guy mentions income tax and omits the regressive payroll tax, FICA tax, and sales tax. Wanna guess what quintile he's in?

  6. The Tax Policy center table than I graphed includes quite a lot of things beyond federal income tax: estate, corporate and capital gains taxes – the things Bush changed. The average federal tax column, the one that's flat for the top decile, includes Medicare and Social Security as well. These strike me as sensible choices. I don't entirely see the relevance to federal tax policy of state sales taxes which are as you say regressive.

Comments are closed.