According to the AP, Brookings’ Tax Policy Center is predicting that this year, the rich will pay some of the highest tax rates since the Congressional Budget Office began keeping track of the data in 1979.
The top 20 percent and 1 percent of earners will pay average rates of 27.2 percent and 35.5 percent respectively.
Meanwhile, the middle 20 percent of the income distribution – households averaging $46,600 – will be paying an average rate of 13.8 percent.
It’s oh so difficult to feel even a subatomic iota of sorrow for the rich here for so many reasons: 1979, of course, marks two years before the start of the Reaganite consensus on executive worship and corporate tax cuts; much of the rich’s income is derived from “unearned” rent-seeking; the elites should be happy to help pay for a society that has helped them prosper; and, due to offshoring and the weakness of organized labor among other factors, lower income workers’ wages haven’t kept pace with their productivity explosion over the past few decades. In short, the wealthy have the money to comfortably pay these “historically high” tax rates — lower still than the high marginal rates that were commonplace throughout the rapid growth post-war era.
Moreover, high tax rates might actually spur growth, in the words of John Judis, by discouraging “the wealthy from rerouting their savings into the kind of speculative activity that helped create the Great Recession,” and, in the words of one small business owner, by encouraging businesses to reinvest their profit before the end of the year.