Tax Fairness & the Economy

Taxes consist of more than just federal income taxes. There are also payroll taxes, sales taxes, property taxes, and the like. The latter fall far more heavily on middle and lower income people than on the truly wealthy. There is an income cap on most payroll taxes, so no tax is paid on income above the cap. Sales taxes are based on consumption, and middle and lower income people consume most, if not all, of their income. When your income is lower, you have to spend it in order to survive. Property taxes again fall more heavily on middle and lower incomes. Property taxes are levied on real property, while the truly wealthy hold more of their assets in intangibles.

Even lower income people who may not own property effectively pay property taxes. When you rent, you are paying rental fees that cover the principle, interest, property taxes, and insurance or the owner, along with maintenance fees and a profit. I owned rental property, I know. Beyond that, income tax rates are highest on standard income, and far lower on capital gains and dividends, which are a far larger part of the income of the truly wealthy. Then there's the 'carried interest' loophole, which allows wealthy hedge fund managers to be taxed at capital gains rates even when they have no money at risk, and even when their salaries are in the billions of dollars. Several studies of the fully loaded tax burden have found that the top income bracket has a tax rate below several of the lower brackets.

As to job creation, corporate profits are at an all time high. That has NOT led to increased job creation. Decreasing taxes on the corporations and wealthy individuals also will not lead to job creation. Those companies and individuals are already rolling in money. Jobs will be created by companies only when there is sufficient demand for the products of that company. There cannot be increased demand until or unless income increases for middle and lower income workers. An increase in the minimum wage would put more money in the hands of poorer workers, who would in turn spend it, increasing overall demand in the economy. In multiple instances states or localities have increased the minimum wage, and have NOT suffered the job losses predicted by right wingers, but instead have often had higher economic growth than areas which did not increase wages.