Footage from the big D.C. Tea Party rally on Thursday:
It seems that Tea Baggers are irate over the recent tax increases that Obama has forced down the throats of the American middle class. I’d be the first to agree that their anger was justified, if only the facts supported their claims. Unfortunately, they don’t. There haven’t been tax increases on the middle class under Obama. Quite the contrary, they’ve fallen. The following comes from the Center on Budget and Policy Priorities:
…Income taxes: A family of four in the exact middle of the income spectrum will pay only 4.6 percent of its income in federal income taxes this year, according to a new analysis by the Urban Institute-Brookings Institution Tax Policy Center. This is the second-lowest percentage in the past 50 years…
Federal income taxes on middle-income families have declined significantly in recent decades.
In 2000, the year before the 2001 tax cut that President Bush and Congress enacted, the median-income family of four paid 8.0 percent of its income in individual income taxes, according to Tax Policy Center estimates — a smaller share than in any year since 1967 (except for 1998 and 1999). The Bush tax cuts further reduced middle-income tax obligations.
This year, the Making Work Pay tax credit, which President Obama and Congress enacted as part of the 2009 American Recovery and Reinvestment Act, is providing a credit of $800 to married joint filers ($400 to single filers). A median-income family with two children thus will receive an $800 tax cut in the return it files this year.
With the new tax cut, the median family’s federal income taxes will equal just 4.6 percent of its income in 2009. That is lower than in any year since 1955 (the first year for which these data are available) except for 2008, when another stimulus-related tax cut was in effect.
The 4.6 percent effective tax rate — the percentage of its income that a family pays in taxes — is well below the 15 percent marginal tax rate that a family of four in the exact middle of the income spectrum faces. Typically, such a family reduces its effective tax rate by taking the standard deduction (or, in some cases, itemized deductions), personal exemptions, and tax credits such as the child tax credit. The Making Work Pay tax credit further reduces that family’s effective tax rate…
So, again, one has to wonder why these individuals weren’t protesting during the last administration, when the effective tax rate was higher? I suppose some of it could be tied to the economy, and the fear of many that their jobs may now be in jeopardy. A lot of people, prior to this most recent economic collapse, probably never gave a moment’s thought to their own savings, or just how much they’d be screwed should they suddenly find themselves without a job. But, now, they’re actually starting to think about it, and worrying about how much actually goes out in taxes. That, generally speaking, is a good thing. People should think about how much they’re contributing toward the running of our nation, and what they’re getting back in exchange. (A sober analysis, I would think, would lead rational people to question the fact that so many of their dollars are going to fight foreign wars, while so few are going toward education.) But, I don’t think that’s the case with most folks… at least not completely. I think most Tea Party participants, out there waving their “Taxed Enough Already” signs, probably think that Obama has raised their taxes. And I think it’s clear that there’s a group out there working actively to spread this lie – that the federal government is evolving toward socialism, and taking more and more of their hard-earned money. And that, I think, is not only loathsome but dangerous.