AJC's Jay Bookman Opined on Obama's Tax Plan

According to the headline: "McCain plan skewed toward affluent; Obama approach more balanced."

After launching the column by highlight McCain's flip-flop, Mr. Bookman proceeds to use analysis provided by the "nonpartisan Tax Policy Center" to repeat their conclusion that “Sen. McCain’s tax cuts would primarily benefit those with very high incomes. … Many fewer households at the bottom of the income distribution would get tax cuts.”

First of all, the Tax Policy Center is decidedly not non-partisan. It is a joint outcropping of the left-of-center Brookings Institution and the Urban Institute. The Brookings Institution's web site proclaims in progressive rhetoric that among their primary goals are to "foster the economic and social welfare, security and opportunity of all Americans" and to "secure a more open, safe, prosperous and cooperative international system". The Urban Institute was created by hthe Johnson administration to study the nation’s urban problems and evaluate the welfare state as embodied in more than 400 laws passed as part of the Great Society initiative and is still funded primarily by federal government contracts. I can hardly see either of these bodies as a bastion of impartiality.

To the rest of the comments, I say "Duh!" When you cut taxes, those benefiting the most, in absolute dollars, will be those who pay taxes. In an analysis of the 2006 IRS data, economists at the Tax Foundation determined that of the 136 million federal tax returns filed, roughly 43.4 million tax returns, representing 91 million individuals, will face a zero or negative tax liability.

A negative tax liability means that these people will not only be paying zero dollars in taxes, they will be receiving a bonus payment from the pockets of real taxpayers. Normally, this is through the Earn Income Tax Credit, which is an anti-poverty program that transfers between $2800 and $4800 from taxpayers to the working poor, provided they have children. However, nearly one-third of the more than $30B expended by this program is going to people who don't qualify (and many who have committed outright tax fraud by claiming it).

On top of that 43.4M filings, another 15 million households will not file a tax return. So roughly 121 million Americans—or 41 percent of the U.S. population—were completely outside the federal income tax system in 2006. And Mr. Obama wants to relieve millions more of their responsibility as citizens to help pay for the upkeep of the country, even in the smallest way. In fact, he wants to just give $1000 qualified families (many of which will now have negative tax liabilities). This is just wealth redistribution, and Karl Marx would be proud.

The Tax Foundation also pored over IRS data to discover that the lower half of tax filers (remember, this does not include the 15M who did not even bother to file) pay, collectively less than 3% of all collected income taxes. The evil, filthy rich, the top 1%? They paid over 40% of all collected income taxes, despite earning only 22% of the the income versus . That means that 1.35M filers paid more than 10 times the collective taxes collected from the 67.85M filers in the bottom 50%. The top 10% paid more than 47% of the total. What, exactly, then is their "fair share"?

Obama's plan will take an extra $788,959 per taxpayer in the top 0.1% (income over $2.8M). Two questions: what is that rich person not going to spending that money on, and do you really think that money will trickle down to the "working class" from the government that confiscates it?

We have a system of government and taxation wherein half the participants are, for want of a better term, free-loading on the system. The old saying is that "A government robbing Peter to pay Paul can count on the support of Paul."