More Tax Information

David Cay Johnson on the grand con that is trickle-down economics:

For three decades we have conducted a massive economic experiment, testing a theory known as supply-side economics. The theory goes like this: Lower tax rates will encourage more investment, which in turn will mean more jobs and greater prosperity—so much so that tax revenues will go up, despite lower rates. The late Milton Friedman, the libertarian economist who wanted to shut down public parks because he considered them socialism, promoted this strategy. Ronald Reagan embraced Friedman’s ideas and made them into policy when he was elected president in 1980.

For the past decade, we have doubled down on this theory of supply-side economics with the tax cuts sponsored by President George W. Bush in 2001 and 2003, which President Obama has agreed to continue for two years.

You would think that whether this grand experiment worked would be settled after three decades. You would think the practitioners of the dismal science of economics would look at their demand curves and the data on incomes and taxes and pronounce a verdict, the way Galileo and Copernicus did when they showed that geocentrism was a fantasy because Earth revolves around the sun (known as heliocentrism). But economics is not like that. It is not like physics with its laws and arithmetic with its absolute values. 

He goes on to show how many tax truisms are just myths perpetuated by the wealthy and their media backers.  His list of the actual truths, which he goes into greater detail on in the article (from Mark Thoma):

1. Poor Americans do pay taxes.
2. The wealthiest Americans don’t carry the burden.
3. In fact, the wealthy are paying less taxes.
4. Many of the very richest pay no current income taxes at all. 
5. And (surprise!) since Reagan, only the wealthy have gained significant income. 
6. When it comes to corporations, the story is much the same—less taxes.
7. Some corporate tax breaks destroy jobs.
8. Republicans like taxes too.
9. Other countries do it better.

Definitely read 1, 2, 4, 8 and 9.