ON-Lion Letter
Inequality has been at the forefront of the nation's recent political discourse recently, including because of a number of published reports purporting to show the rich getting richer, while the rest of America is stuck in neutral.  Indeed, one report suggests that Americans have not been this unequal since the Great Depression.  Support is thus growing in both Washington, D.C., and among the public to raise tax rates on the "rich" to reduce inequality in America.

As a new chart book from the Tax Foundation in Washington shows, however, much of the perceived rise in inequality is really the natural result of the business cycle, as well as social and demographic forces far beyond the role of tax policy.  In fact, there is no evidence of a long-term trend in inequality during the last 20 years, only wide swings up and down.

Thanks to misdirected tax policy, according to the Tax Foundation, America is becoming divided between a shrinking group of taxpayers who are bearing the lion's share of the cost of government today and a growing group of taxpayers who are disconnected from the basic cost of government.

The goal of its chart book is to put a face on the ever-changing demographics of American taxpayers.  The failure to understand these changes has produced poor tax policy and threatens to undermine efforts to overhaul the tax code.

The Lynde and Harry Bradley Foundation in Milwaukee supports the Tax Foundation.
Actions: E-mail | Permalink |