Americans And Taxes

(Cartoon above is by David Horsey in the Los Angeles Times.)

Unless you've been living in a cave in the middle of nowhere, you've probably heard about Willard Mitt Romney (aka Wall Street Willie) and his disdain for 47% of the American people. He was trying to get in good with a bunch of his rich donors, and noted that nearly half of Americans were too lazy to pay any income taxes. He claims he was misunderstood, but it was obviously an attempt to get more money from those rich people by commiserating with how they are abused because they have to pay income taxes.

The truth is that every single one of that 47% of Americans would love to have to pay income taxes. They would love that because that would mean they make a pretty good income -- enough to assure them of a decent living. The very idea that these people intentionally make a small income just so they won't have to pay income taxes is offensive -- and it shows that Willard has no idea about how hard life is in this country for low-wage workers and those who must live on a fixed income (like the elderly and the disabled).

And of course, the way Willard phrased his disdain for these people made it sound like they pay no taxes at all. That is an outrageous idea. All Americans pay taxes, even the poorest Americans. When other taxes are included (like sales taxes, property taxes, payroll taxes, etc.), we find that the poorest Americans, those in the bottom fifth of the population in income, average paying 17.4% of their income in taxes -- which is a big hit considering the low incomes of that group. The majority of Americans pay between 25% and 30% of their income in taxes.

But even if we consider only those who pay income taxes (and disregard other kinds of taxes), the United States is pretty lucky to have such a large percentage of the population (53%) doing well enough to pay those taxes. Many other countries have a much smaller percentage paying income taxes.

Take India for instance. In that country anyone who makes $3,700 a year (or about 3 times that country's per capita income) must pay income taxes. That means a whopping 2.8% of their population pays income taxes. In China, the percentage is even smaller. Only 1.72% of the Chinese population qualifies to pay income taxes. That means 97.2% of India's people and 98.28% of China's people don't pay any income taxes (which combined represent about 1.3 of the world's population not paying income taxes -- and that doesn't include any other countries).

It is not shameful that only 53% of Americans pay income taxes. What is shameful is that 47% of the people in the richest country on Earth have such a small income that they don't qualify to pay income taxes. Guess which political party is responsible for that. It's the same party that has kept the minimum wage at such a low level (and would like to abolish it completely) -- the Republican Party. Willard should be ashamed of his statement, and so should his Republican and Wall Street cohorts.