It isn't rare to hear from the President and various other pundits (like Warren Buffet, Robert Reich, and various other Democrats and liberals) that wealthy are not paying their fair share of income taxes and need to be taxed more. President Obama even once said the following: "there is still more to do when it comes to reducing our debt. And I’m willing to do more, as long as we do it in a balanced way that doesn't put all the burden on seniors or students or middle class families, but also asks the wealthiest Americans to contribute and pay their fair share."
However this CBO study shows that the rich have indeed been paying their "fair share", at the very least. In 2011, there has been an extremely unequal distribution of government transfer payments and federal taxes. It seems that even though the reality of income inequality appears more blatant and stressful for the lower echelons in income, these same people are also receiving (unsurprisingly) the most transfer payments. What is surprising, however, is the observation that the wealthy have been doing their part in payments, when the general consensus is that they do not pay enough.
If this study turns out to be very accurate to reality, shouldn't it also be seen as another incentive for the wealthy to want a reduction in income inequality, too? Not that the wealthy doesn't actually care about reducing income inequality, but if any of us were in their shoes, chances are we would have a hard time making the necessary sacrifices too. The road to recovery doesn't just take sacrifices from the rich though, and while we are attempting to fix our issues, it appears the rich may be sacrificing more than they need to.
Comes to show how a broad problem doesn't just require one solution.
Source:
- http://www.aei.org/publication/new-cbo-study-shows-rich-dont-just-pay-fair-share-pay-almost-everybodys-share/
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