Wednesday, July 18, 2012

Taxes, Transfers, and Voting

Roberta X has an extreme proposal...
"It's simple: if the Feds give you money, from a handout to a paycheck to a bailout, you can't vote."
"I always said you shouldn't get a vote unless you were a net tax payer."
Speaking of "net tax payers," I read this depressing bit of news that the middle class is no longer a net contributor (via Althouse):
"Because transfer payments are, in effect, the opposite of taxes, it makes sense to look not just at taxes paid, but at taxes paid minus transfers received. For 2009, the most recent year available, here are taxes less transfers as a percentage of market income (income that households earned from their work and savings):
Bottom quintile: -301 percent
Second quintile: -42 percent
Middle quintile: -5 percent
Fourth quintile: 10 percent
Highest quintile: 22 percent
Top one percent: 28 percent
The negative 301 percent means that a typical family in the bottom quintile receives about $3 in transfer payments for every dollar earned.
The most surprising fact to me was that the effective tax rate is negative for the middle quintile. According to the CBO data, this number was +14 percent in 1979 (when the data begin) and remained positive through 2007. It was negative 0.5 percent in 2008, and negative 5 percent in 2009. That is, the middle class, having long been a net contributor to the funding of government, is now a net recipient of government largess."
Maybe this means President Obama was 60% right about building things on our own. (Also via Althouse)

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