On the Jan. 12 edition of Fox News Sunday, Tony Snow denounced the Bush tax cut for being tooredistributionist. Chatterbox figured someone would use the “tax the poor” argument to justify the Bush tax cuts, but he never imagined someone would use that argument to attack the Bush tax cuts. Let’s look at Snow’s logic:
- Under the Bush tax plan, “families earning more than $100,000 would pay 73.3 percent of the total income tax burden. Families earning less than $50,000 would pay only 2.9 percent of the bill.” What Snow doesn’t say is that families earning more than $100,000 pay a large proportion of the federal income tax because they earn a large proportion of the income—nearly half, in fact. Families earning less than $50,000 pay a small proportion of the federal income tax because they earn a small proportion of the income—about one-quarter. When you figure in other federal taxes, including the very regressive payroll tax—which conservatives steadfastly refuse to do—that pretty much erases whatever imbalance exists between tax proportion and income proportion. And that’s not even counting state and local taxes, which are also notably regressive. According to a new study from Citizens for Tax Justice, a labor-funded nonprofit, the average state and local tax rate for the richest 1 percent of the population is 5.2 percent; for the middle 20 percent, 9.6 percent; and for the poorest 20 percent, 11.4 percent.
- Under the Bush plan, “the poor get the largest proportional tax breaks, the richest, the smallest.” But the poor don’t pay much income tax in the first place, so a small cut is going to look very impressive proportionally. Gentle reminder: The poor don’t pay much income tax because they don’t have much income.
- Under the status quo, “our tax code is insanely imbalanced already, with half the public paying nearly 100 percent of the income taxes.” Again, this is mainly the result of income inequality, and ignores non-income federal taxes and state and local taxes, which are imbalanced in the opposite direction.
- Taxing poor people lightly is harmful because it “mocks the idea that citizenship demands that each person pull his or her weight. Two generations ago, Americans celebrated success, and urged kids to do well and accumulate wealth. We’re now on the verge of a society that cleaves into two classes: Those who pay taxes and those that get tax money from Uncle Sam.” Chatterbox would like to meet one low- or middle-income American who has actually instructed his children to avoid accumulating wealth because they’ll end up having to pay taxes. Just one!
- Conclusion: “The real question is whether the White House realizes that its own plan is an agent for making envy not merely respectable, but further establishing it as the law of the land.” Envy is one of the Seven Deadly Sins. But so are avarice and gluttony.
The Bush administration’s propaganda task now is to publicize that Snow thinks their tax cut too progressive without making it obvious that Snow (who, incidentally, was chief speechwriter in the first Bush White House) believes poor people should pay more in taxes. The latter argument is still too outrageous for most Bushies to embrace explicitly. A better tack might be to publicize a Jan. 9 column by Debra Saunders, a conservative columnist for the San Francisco Chronicle, who lays out an argument almost identical to Snow’s but then disavows where that argument is headed: “Am I suggesting that America raise taxes on poor and middle-income earners? Of course not. I wouldn’t want to join the ranks of those who raise families on $30,000 or less, and who do pay payroll, excise and sales taxes.” But don’t tempt me!