The New York Times, October 11, 2019: How To Tax Our Way Back To Justice
America’s soaring inequality has a new engine: its regressive tax system. Over the past half-century, even as their wealth rose to previously unseen heights, the richest Americans watched their tax rates collapse. For the working classes over the same period, as wages stagnated, work conditions deteriorated and debts ballooned, tax rates increased.
Stop to think this over for a minute: For the first time in the past hundred years, the working class — the 50% of Americans with the lowest incomes — today pays higher tax rates than billionaires.
The full extent of this situation is not visible in official statistics, which is perhaps why it has not received more attention. Government agencies like the Congressional Budget Office publish information about the distribution of federal taxes, but they disregard state and local taxes, which account for a third of all taxes paid by Americans and are in general highly regressive. The official statistics keepers do not provide specific information on the ultra-wealthy, who although few in number earn a large fraction of national income and therefore account for a large share of potential tax revenue. And until now there were no estimates of the total tax burden that factored in the effect of President Trump’s tax reform enacted at the end of 2017, which was particularly generous for the ultra-wealthy.
