Re: “The tax man cometh,” April 15 Mike Rosen column.
I appreciate Mike Rosen’s position on taxes — since no one likes to pay more taxes — but I fear his facts may be as misleading as are the claims he makes against others, mainly Warren Buffett.
Rosen says that a family of four making $52,000 in 2009 pays zero taxes. I tried to work up the taxes using the federal guidelines and discovered that he really took a lot of assumptions to get to zero. I came up with about $4,000 in taxes. Of course, if the family owns a home, that will drop the tax burden, as will other taxable deductions.
Speaking of which, these other taxable deductions are what used to be paid for by the federal government, such as higher ed credits and mental health institution support. These taxes are now burdens of the states, and since the Reagan revolution, caused the prison rolls to skyrocket with the mentally disabled as well as greatly tax the local governments. But as Rosen likes to say, “I digress.”
Now this family of four also pays Social Security taxes of 7 percent (more if self-employed). Rosen mentions that this money goes to the benefit of the family in the form of future Social Security payments. This is the most deceiving part of Rosen’s article. He must realize that since 1968, the Social Security taxes were added to the General Fund to help pay for things such as the Vietnam War. It took us over 20 years to get inflation down from that war — and then we decided to go to war again. Only this time, in 2002, we decided to really rob the future by cutting taxes to pay for the war. This policy further burdens the Social Security system.
Basically, our family of four has a tax burden of 7 percent on the entire income while the richest 20 percent pay on only the first $105,000. Plus, they never realize the full amount that they supposedly saved. Would you invest in a mutual fund with these types of fees?
Finally, Rosen states that the top 10 percent pays “only 70 percent” of all of the tax burden. But doesn’t the top 10 percent make 80 percent of the total income? By Rosen’s own definition, they are short-changing the U.S. population of 10 percent of the tax burden.
Mr. Rosen, 2009 is the last year of the tax policies that were established under the Bush administration. During the last 30 years, we have seen the gap between the lower-middle classes and the upper classes widen while the middle-class incomes and the deficits have worsened (with the exception of a short period in the 1990s). Let’s hope you are more fair in your analysis of taxes in the Obama era.
John Tate Libby of Roxborough is author of the economic political novel “A Jeffersonian Experience” (Xlibris Corporation 2007).
