Buchanan on The New, Brazen, and Completely Dishonest Attack on Progressive Taxation

Last week, I blogged the Wall Street Journal op-ed by Ari Fleischer, The Taxpaying Minority.  In response, Neil H. Buchanan (George Washington) has published an op-ed in this week's FindLaw:  Is it Really So Tough to Be Rich? The New, Brazen, and Completely Dishonest Attack on Progressive Taxation:

Fleischer argues: "Our tax system comes up short in a lot of areas. It doesn't foster economic growth. It isn't very simple. And it certainly isn't fair. The one place where it does excel is at redistributing income." How do we know this? Because the richest 1% of all taxpayers paid 37% of all federal personal income taxes in 2004; the richest 10% paid 71% of those taxes; and the "most successful" 40% paid 99%. "Think about it. Ten percent pay seven out of every 10 dollars and their share of the burden is rising," warns Fleischer. This argument, however, is fundamentally dishonest in at least three ways. ...

Fleischer insinuates that we're doing a great job of redistributing income because, for example, ten percent of the population paid 71% of all federal personal income taxes in 2004. That statistic, however, tells us absolutely nothing about redistribution, nor does it tell us whether the tax code is even mildly progressive in the first place. ...

Fleischer also complains that some people pay no federal personal income taxes at all: "The income tax system is so bad … that 40% of the country's households -- more than 44 million adults -- pay no income taxes at all. Not a penny." This, of course, ignores the question of whether those 44 million adults are earning enough money to be taxable in the first place. Should they really be paying federal income taxes if the money will come out of their budget for decent food, healthcare, housing and clothes for themselves and their children? ...

Arguments like Fleischer's typically refer to "taxes," but they are really referring only to the federal personal income tax. There are, of course, many other kinds of taxes that people pay. Fleischer argues that Social Security and Medicare taxes do not count because both systems are redistributive in their benefits. He thus rules out of consideration taxes that just happen to be imposed on the first dollar of income earned (while the Social Security tax is not imposed at all on incomes above $97,500). In short, his argument asks us to ignore a significant part of the tax system that is very non-progressive by design.