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According to a just released analysis by Berkeley economists Gabriel Zucman and Emmanuel Saez, the bottom 50 percent of earners in the United States now pay a higher overall tax rate than multimillionaires.
Of course Average Joe pays the most in taxes. The U.S. taxes salaried labor at the highest rates while other forms of income are taxed at lower rates. How much of Jeff Bezos' massive wealth came from salary or wages?
I don't know about the "destroy" part but it is pretty clear that Saez and Zucman did some very questionable analysis to make their claim work, recategorizing a lot of non-tax items as a tax. It is not their credibility that is being questioned, it is their methods and conclusions. Many of the things they did have some questioning if their approach is not being influenced by their political beliefs. Some of their other papers have argued for a wealth tax of as much as 10% /year (vs Warrens 2-3%) and increasing tax rates to above 60% to redistribute wealth.
To get to their conclusion, they increased the tax rate of low income by adding some items not normally considered individual taxes to the low income tax rate, including adding some corporate taxes as if the individuals paid them, categorizing all health insurance payments as a tax, adding over $250 Billion in what they called "indirect taxes" and specifically excluding any tax credits available - the combined effect is to boost the tax rate of the bottom payers from about 3.7% actual to 24.2% for comparison against the rich.
At the same time they effectively reduced the top rate they were comparing to by having the group at the top be those who are really only subject to Long Term Capital Gains - which caps out at 23.8%. If look at the actual top 0.01% instead of this group paying only 23.8% capital gains, that top 0.01% groups tax rate is well above 30% which doesn't make their story work even with low income "adjusted" tax rate of 24.2%.
Let me begin with this. Saez and Zucman are geniuses. They have a throng of high level Ph.D candidates working with and for them. The data fudging was not accidental.
I'd say destroy is close. For just one point, Saez and Zucman quitely omitting The Earned Income Tax Credit from their calculations simply cannot be attributed to error of oversight.
I've graded literally thousands of graduate level econ. tests, papers and projects and read, reviewed and judged countless dissertations and theses. Let me be 100% clear. Any masters or Ph.D candidate attempting this level of bait and switch would earn and F and be excoriated.....and theses with omissions of this magnitude would be rejected.
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The sad truth is, much like Piketty's nonsense (Piketty is also a well known stuntman with numbers) these guys are not even attempting to pass muster within economic circles. They are throwing chum to the American political left. They want someone like Warren to win and further their collectivist beliefs. As such they are side stepping peer review, withholding data and methods until their cheerleading distortion has made it through news cycles and fed. the left wing twitter-sphere for a while.
Peter Temin and his, it takes 20 years and 100% good luck to escape poverty nonsense falls in the same category. Although in fairness Temin takes liberties and uses illogical numbers to prove his point. He does not commit what would be academic fraud in other circumstances like Saez and Zucman.
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It's too bad that economic researchers are held to no account relative to say medical researchers. In medical research it's usual to have an disinterested party or near disinterested party review inputs and methods and another review statistics/math/physics etc.
Let me begin with this. Saez and Zucman are geniuses. They have a throng of high level Ph.D candidates working with and for them. The data fudging was not accidental.
I'd say destroy is close. For just one point, Saez and Zucman quitely omitting The Earned Income Tax Credit from their calculations simply cannot be attributed to error of oversight.
I've graded literally thousands of graduate level econ. tests, papers and projects and read, reviewed and judged countless dissertations and theses. Let me be 100% clear. Any masters or Ph.D candidate attempting this level of bait and switch would earn and F and be excoriated.....and theses with omissions of this magnitude would be rejected.
_____________________
The sad truth is, much like Piketty's nonsense (Piketty is also a well known stuntman with numbers) these guys are not even attempting to pass muster within economic circles. They are throwing chum to the American political left. They want someone like Warren to win and further their collectivist beliefs. As such they are side stepping peer review, withholding data and methods until their cheerleading distortion has made it through news cycles and fed. the left wing twitter-sphere for a while.
Peter Temin and his, it takes 20 years and 100% good luck to escape poverty nonsense falls in the same category. Although in fairness Temin takes liberties and uses illogical numbers to prove his point. He does not commit what would be academic fraud in other circumstances like Saez and Zucman.
_____________________
It's too bad that economic researchers are held to no account relative to say medical researchers. In medical research it's usual to have an disinterested party or near disinterested party review inputs and methods and another review statistics/math/physics etc.
I agree although it is interesting, it is very flawed - and I pointed out them omitting tax credits and even worse divarication's to change the narrative and get them to their flawed conclusions. It was innovative but flawed analysis that looks like the main intent was to push a political view and gain them exposure. I would not grade them as hard because it is their work and some innovative thought was put into it, but would make them put more work into defending their analysis and conclusions.
BTW - I was undergrad econ at UC Berkeley and grad at University of Chicago. These are top notch economists but, almost no other economist agrees with their methods in this study. This was done
You might want to actually read some the ideas from these jokers. Clearly you haven't.
Piketty amongst other taxes wants a 60% rate on income over $200K and an 80% over $500K AND an accumulated wealth tax on net worths over $200K. Even France has ditched its wealth tax.
The three have argued that the top rate should be 83%.
You may want to eat your red herrings rather than attempting to use them to alter the conversation. Whether or not any of them are looking to support a worldwide taxing authority is totally irrelevant to the discussion at hand and none of them are in a position to effect such a thing.. The inclusion of Piketty into this conversation is also diversionary as he is neither part nor parcel of the article being cited by the OP. France is France, this conversation is about taxation in the United States.
I don't know about the "destroy" part but it is pretty clear that Saez and Zucman did some very questionable analysis to make their claim work, recategorizing a lot of non-tax items as a tax. It is not their credibility that is being questioned, it is their methods and conclusions. Many of the things they did have some questioning if their approach is not being influenced by their political beliefs. Some of their other papers have argued for a wealth tax of as much as 10% /year (vs Warrens 2-3%) and increasing tax rates to above 60% to redistribute wealth.
To get to their conclusion, they increased the tax rate of low income by adding some items not normally considered individual taxes to the low income tax rate, including adding some corporate taxes as if the individuals paid them, categorizing all health insurance payments as a tax, adding over $250 Billion in what they called "indirect taxes" and specifically excluding any tax credits available - the combined effect is to boost the tax rate of the bottom payers from about 3.7% actual to 24.2% for comparison against the rich.
At the same time they effectively reduced the top rate they were comparing to by having the group at the top be those who are really only subject to Long Term Capital Gains - which caps out at 23.8%. If look at the actual top 0.01% instead of this group paying only 23.8% capital gains, that top 0.01% groups tax rate is well above 30% which doesn't make their story work even with low income "adjusted" tax rate of 24.2%.
Questioning how their political beliefs has influenced any discussion is fair game; certainly the politics of Magness has influenced, and paid for, his critique of the work of Saez and Zucman. Attempting to distill an entire body of research into a couple of paragraphs here is nonproductive and influenced by its own bias.
Libritarisns dont believe in the "social contract" so its pretty right wing. A libritarian society allows for massive stratification of wealth and allows for indentured servitude if someone is not part of that wealth and is in a difficult situation (ie very little money)
You may want to eat your red herrings rather than attempting to use them to alter the conversation. Whether or not any of them are looking to support a worldwide taxing authority is totally irrelevant to the discussion at hand and none of them are in a position to effect such a thing.. The inclusion of Piketty into this conversation is also diversionary as he is neither part nor parcel of the article being cited by the OP. France is France, this conversation is about taxation in the United States.
Negative. Illustrating just how left wing these men and a long time collaborator are and how curiously often they and other left wing economists and social commentators fudge numbers is all about providing context.
Further, noting specific examples of Saez and Zucman's numerical tomfoolery is utterly legitimate.
To put this thing to bed and as I noted above Saez and Zucman are nth degree smart and learned men and each has a team of the highest calibre Ph.D candidates. As such it's not reasonable to believe the team simply erred by omitting EITC numbers on the low income side of their data set.
Until you explain why/how I am wrong on this point everything you write on this topic is in fact diversionary as your last couple of comment towards me most certainly have been.
Although I'm highly skeptical of the claim that the lower and middle classes pay a higher effective tax rate than the wealthy, as a recent cover of this story in "Capitalist Tool" Forbes magazine says:
"..Arguments about methodology shouldn’t mask Saez’s and Zucman’s bigger point: Incomes of the very rich are rising faster than for all other income groups. And the TCJA cut the taxes of high earners by more on average than for low- and moderate-income households, as a share of after-tax income.."
Yes - people are missing the forest for the trees and turning themselves into knots to dispute the broader point of how we've slipped into a new Gilded Age.
Negative. Illustrating just how left wing these men and a long time collaborator are and how curiously often they and other left wing economists and social commentators fudge numbers is all about providing context.
Further, noting specific examples of Saez and Zucman's numerical tomfoolery is utterly legitimate.
To put this thing to bed and as I noted above Saez and Zucman are nth degree smart and learned men and each has a team of the highest calibre Ph.D candidates. As such it's not reasonable to believe the team simply erred by omitting EITC numbers on the low income side of their data set.
Until you explain why/how I am wrong on this point everything you write on this topic is in fact diversionary as your last couple of comment towards me most certainly have been.
Politicizing an economic discussion is in and of itself diversionary and exhibits a desire to ignore the topic at hand which is the current work of Saez and Zucman. The OP turned it into a political issue, intentionally or not, by citing a critique that was clearly political motivated as the author is employed by various politically inspired organizations. Facts should be challenged with facts, not innuendo.
Additional comments reinforcing the political nature of the disagreement and drawing in people not instrumental to either the report or its review, as if they were, is simply dishonest. Incomplete and misleading data is the nemesis of all good research, one that is not exclusive to any section of the political spectrum. Selectively extracting such out of context is no solution.
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