In his recent address to the nation, President Obama advocated a “balanced approach” to deficit reduction, where the top 2 percent of taxpayers—those making $250,000 a year or more—would “share in the sacrifice everyone else has to make.” He expressed confidence that these “patriotic Americans” would “pitch in” to help solve our looming debt crisis.
But data from the IRS tells a different story, one where this small group of taxpayers is already pitching in plenty, and paying nearly the half the country’s income taxes.
In 2008—the most recent year we have data for—these taxpayers provided 46 percent of all federal income taxes. The bottom 50 percent of taxpayers–representing 70 million returns–provided 3 percent of all federal income taxes.
There are clear consequences from further leveraging the wallets of the wealthy to weather our debt crisis. The burden of running social entitlement programs must be more widely spread to all Americans or else we have to confront the reality that we have promised far more government than we can deliver.