Image Credit: Big Stock-Brooke Medina

Elizabeth Warren and Bernie Sanders have led the charge to add many zeros to what some Americans should be given at others’ expense. As a result, they have doubled (or tripled) down on an “old reliable” claim of the left that “the rich” don’t pay their “fair share” of taxes. But that excuse to tax them more to line others’ pockets is obliterated whenever the highly disproportionate income tax burdens actually borne by higher earners are reported.

Regressive Taxes? 

Rather than abandon the electorally valuable false premise that ever-more disproportionate burdens are justified, however, the political left tries to buttress their position by asserting that other taxes are regressive, so that even more progressive federal income taxes are justified. The main components of such claims are state and local sales and excise taxes and Social Security taxes. Unfortunately, those taxes must also be distorted to defend “fair share” misrepresentations.

Los Angeles Times writer Michael Hiltzik illustrated the state and local gambit in a column echoing charges that their sales and excise taxes “disproportionately hammer lower-income taxpayers,” with that alleged regressivity offsetting income tax progressivity.

That claim arises because those with lower current measured incomes spend a larger proportion of them on those taxes. However, as Edgar Browning has noted,

relative to lifetime income, there is very little difference in the percentage of income consumed among income classes.

As a result, apparent regressivity based on current incomes is shown instead as “roughly proportional” to income in the more-appropriate lifetime context. Low current-income families also often consume a multiple of their income, largely financed with government transfer payments that are excluded from official income measures, which further exaggerates the share of their incomes going to such taxes.

Proportional Social Security 

The Social Security angle is illustrated by articles citing the fact that Social Security taxes only apply to earned incomes up to an earnings cap, currently set at $132,900. For instance, a Washington Post article summarized the result as “the more money you make, the less your effective Social Security tax rate is, making this tax about as regressive as they come.” However, Social Security treats lower-income workers far better than higher-income workers.