In a society with 100 people where 99 make $1/year and 1 makes $1000/year you would have an even more absurd ratio. That ratio may be shocking and useful for political arguments.
But isn't the real issue that 1 person is making a thousand times what everyone else makes? And wouldn't it be truly absurd to expect those 99 to pay more instead of the 1%?
Things grow exponentially fast as you reach the top. If you look at the Forbes 100, Jeff Bezos is worth about 2x number 5, 10x number 40. [1]
The net worth of the top 1% is 10 million. That's 10,000x less than Jeff Bezos. The percentile/wealth graph is an insane hockey stick.
I don't doubt the 1% pay a big chunk of the pie. I do wonder if it's an amount proportional to their wealth, but let's leave the millionaires aside. I wonder what part of that 37% the billionaires are paying, and if _that_ is a fair amount.
> I do wonder if it's an amount proportional to their wealth
Federal income tax is based on income, not wealth. It's entirely possible (and happens all the time) that wealthy people have a bad year with their investments and lose money. They don't pay income taxes on losses.
You don't need to make much more than me for that to start become profitable - accountants, trust costs, etc eat up a relatively fixed amount of money. But once you exceed that cost then it's time to start shifting money around.
Not that this doesn't reduce the tax you pay on your income. it directly reduces your "income" itself.
> the bottom 50% accounted for a measly 3% of all tax.
Of course they do, that is a symptom of the problem. Take an absolute extreme of society: one person has all the wealth, and everyone else has nothing. Obviously, that one person will pay 100% of the taxes, and everyone else will pay 0%.
Today, we see a similar but less extreme situation. It's not intuitive at first glance, but think about it for a few seconds and it makes sense: if you want a more balanced distribution of tax burden across society, you need a more balanced distribution of wealth across society.
Accordingly, if you want the bottom 50% to pay more, you actually have to tax the rich more to reach a more equal distribution of wealth.
> Take an absolute extreme of society: one person has all the wealth, and everyone else has nothing. Obviously, that one person will pay 100% of the taxes, and everyone else will pay 0%.
Only if the only taxes are wealth taxes. You're in a discussion about income taxes.
> Only if the only taxes are wealth taxes. You're in a discussion about income taxes.
wealth = income - consumption
In the U.S., we tax all three: general income tax, consumption tax (e.g., sales tax), and wealth tax (e.g., property tax). Taxing any one has an effect on the other, and a discussion about one is relevant to all others.
No, income - consumption is net increase in wealth. Those are all flows. Wealth is a stock. Wealth taxes are periodic taxes on the value of the stock, income taxes are taxes on the flow.
wealth is not zero-sum, and it's not finite. never has been, never will be. anyone can become rich as demonstrated by all the self made uber rich. if we can't understand this as a group, i don't see how driving away tax income by way of over taxing the rich has anything to do with making the bottom 50% pay their fair share.
But isn't the real issue that 1 person is making a thousand times what everyone else makes? And wouldn't it be truly absurd to expect those 99 to pay more instead of the 1%?