As originally published by Reason Magazine...
Where are the “fact-checkers” when you need them?
As noted ad nauseum, MSM "fact checking" is often about as reliable as MSM reporting.
On CBS News’s “60 Minutes” Sunday night, President Obama said, “Taxes are lower on families than they've been probably in the last 50 years. So I haven't raised taxes.”
As of Monday morning, neither the Washington Post’s Pinocchio-awarding Fact-Checker, nor the Annenberg Public Policy Center’sFactCheck.org, nor the Tampa Bay Times’ Pulitzer-Prize-winning Politifact.com had risen to this opportunity, so let us take a stab.
Re: WP "Fact Checking"... please see here.
There are a variety of possible ways to measure the tax burden on American “families” over the past 50 years. Fortunately, Mr. Obama’s own White House Office of Management and Budget provides a spreadsheet that summarizes federal tax receipts from 1940 through the present. Fifty years ago, in 1962, federal tax receipts were $99.7 billion. In 2011, they were $2.3 trillion. Far from being at a 50 year low, the taxes extracted from American families last year were about 23 times what they were fifty years ago.
Okay, but aren’t there more families in America now than there were 50 years ago? Sure. The 1960 Census counted about 179 million Americans, while the 2010 Census counted about 309 million. The population hasn’t even doubled, but the federal government’s tax receipts have increased 23 times.
Okay, but what about inflation? President Obama’s own Office of Management and Budget tries to deal with that question by using something called “constant (FY 2005) dollars.” It’s not as trustworthy a measure as, say, the price of gold, but since the White House uses it, it’s worth at least a look. By this measure, federal taxes climbed to nearly $2 trillion in 2011 from about $660 billion in 1962. In other words, the taxes trebled, even as the population didn’t even double.
Remember, too, that 1962 wasn’t some kind of blissful Jeffersonian small-government era to which we can never possibly return. It was the height of the Cold War. President Eisenhower had only shortly before warned of the military-industrial complex. President Kennedy was going around giving speeches about how the tax burden was too high.
Okay, what about tax rates? By that measure, taxes aren’t at a 50-year-low, either. Don’t take my word for it: look at the chart from the Tax Policy Center operated by the Brookings Institution and the Urban Institute, two center-left think tanks whose work President Obama likes to cite when he claims that a President Romney would raise taxes on the middle class. Sure enough, in 1988 and 1989 the top marginal income tax rate was 28%. In 1990, 1991, and 1992 it was 31%. Today it is 35%.
Okay, that’s the federal income tax rate. But what about the payroll tax rate? Here, too the Brookings-Urban Tax Policy Center has a useful chart. In 1962 the Social Security payroll tax was 6.25%, applied to the first $4,800 in wages. There was no Medicare tax, because Medicare did not yet exist. In 2011 — even after the two percentage point temporary payroll tax “holiday” — the tax was 10.4% applied to the first $106,800 in income, plus a 2.9% Medicare tax that applies to all wage income, with no cap. The tax, in other words, has more than doubled since 1962.
How about the federal gas tax? Fifty years ago, in 1962, it was four cents a gallon, according to the Tax Foundation. It’s now 18.4 cents a gallon. Far from being at a 50-year low, it has more than quadrupled.
I just checked... in 1962 a gallon of regular was .31-cents. So in real terms... the federal gas tax is effectively "less" now - as a percentage of the per gallon cost - than it was then.
This noted... I do wonder what I'd find if I were to factor in state gas taxes...
There is one measure — federal tax revenues as a percentage of GDP — by which taxes under President Obama have been at a 50-year low, at least according to the Office of Management and Budget. But if that’s Mr. Obama’s yardstick, then it also shows government spending and budget deficits have been at 50-year highs under Mr. Obama.
The second sentence of Mr. Obama’s “60 Minutes” claim — “I haven’t raised taxes” — is similarly slippery. Before Mr. Obama had been in office for a month he signed a law increasing the tobacco tax by $71 billion over 10 years. A 10% tax on tanning salons went into effect on July 1, 2010, a tax increase of $2.7 billion over 10 years. If Mr. Obama hasn’t raised more taxes, it hasn’t been for lack of trying; the only thing stopping him has been the Republican House of Representatives.
It would be a shame if voters fall for Mr. Obama’s misleading claim that their taxes are at a 50-year low. But who can blame the voters, or, for that matter, the fact-checkers, if even Mr. Obama’s opponent, Mitt Romney, buys into the idea. In the same “60 Minutes” program, Mr. Romney said taxes would remain essentially unchanged if he won. “I don’t want a reduction in revenue coming into the government,” Mr. Romney said.
F U C K I N G... M O R O N... R O M N E Y...
It’s enough to make one nostalgic for George W. Bush, or at least to prompt one to wish for a politician who can articulate the tax issue not in terms of what it means for the government’s revenues but in the language of what it means for the individual.