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Inequality is up, way up

From Reuters:

The analysis found that inequality has risen not just in plutocratic hubs such as Wall Street and Silicon Valley, but also in virtually every corner of the world’s richest nation:

  • Inequality has increased in 49 of 50 states since 1989.
  • The poverty rate increased in 43 states, most sharply in Nevada, ravaged by the housing bust, and in Indiana, which saw a rise in low-paying jobs.
  • Twenty-eight states saw all three metrics of socioeconomic well-being worsen. There, inequality and poverty rose and median income fell.
  • In all 50 states, the richest 20 percent of households made far greater income gains than any other quintile – up 12 percent nationally.
  • Income for the median household – in the very middle – fell in 28 states, with Michigan and Connecticut leading the way.
  • The five largest increases in inequality all were in New England: Connecticut first, followed by Massachusetts, New Hampshire, Rhode Island and Vermont. The decline in manufacturing jobs hit New England’s poor and middle hard, while the highly educated benefited from expansion in the biotech and finance industries.
  • The only state that didn’t see a rise in inequality: Mississippi, which had an insignificant dip. The Magnolia State was one of the few to post a drop in poverty and a rise in income, but it still ranks worst in the nation on both counts.
By |2012-12-19T06:50:31-04:00December 19th, 2012|Economy|Comments Off on Inequality is up, way up

Odd numbers

One of my frequent conservative commenters said this, “The federal tax burden on the economy is $36,000 for a family of 4.” $36,000? Wow, that’s a lot of money. Let’s look at this number.

First of all, I’m not sure where this number comes from. I suspect that comes from the Tax Foundation, which is an anti-tax group has been around for over 70 years. They’ve been known to play with numbers before. The Center for Policy and Budget Priorities looked at their methodology and found it to be flawed.

According to the U.S. Census (they have two different surveys to calculate median income) the average American household in 2008 made $50,303 (CPS numbers). Using the number 36,000, this would mean that the average American household would have only $14,000 to pay state and local taxes and live off of per year. There’s no way that this is accurate. Now, it may be that we’re not comparing apples to apples. In 2007, federal, state and local taxes added up to approximately $3.8 trillion. That’s 27% of our gross domestic product. If we get out the calculator that equals approximately $13,000 per person. The effective tax rate for Americans in the middle quintile was 14.2% in 2006. If we get our handy dandy calculator, remembering that we’re using a 2006 tax rate and 2008 income, we get the average federal tax for the average American household to be $7042. That’s a whole lot less than $36,000. There is no way the average family of 4 making $50,303 pays $36,000. This number is wrong or I simply don’t understand the quote.

By |2010-04-06T09:00:58-04:00April 6th, 2010|Economy|Comments Off on Odd numbers
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