A recent
report from the Congressional Budget Office shows that the gap between the
richest one percent of earners in the US and the middle class has more than
tripled since 1979.
But that
didn't stop Fox Business host Cheryl Casone from using the report as the basis
of her proposed solution to the US's mushrooming budget deficit: Increase taxes
on the poor.
In a
discussion on the CBO report , which showed that 40 percent of
income tax filers ended up paying no federal income tax in 2007, Casone argued
that fixing this "imbalance" would solve the federal debt problem.
"The
fact that most Americans are not paying any income tax at the end of the day
kind of shows the imbalance," Casone said on Cashin'
In Saturday."What
if everyone pays just a little bit -- we're out of debt in this country."
That idea
was rejected by Christian Dorsey of the Economic Policy Institute, who pointed
out that people who pay no federal income taxes still pay state and local
taxes.
"When
you factor in their local taxes as well as their state taxes, you find that the
poorest 90 percent are paying almost the same share of total taxes as the upper
one percent," he said.
An analysis of the CBO's report, carried out by
the Center for Budget and Policy Priorities, shows that the income gap between
the richest one percent of earners and the middle fifth "more than
tripled" between 1979 and 2007.
The report
found that:
Between 1979 and 2007, average after-tax incomes for the
top 1 percent rose by 281 percent after adjusting for inflation — an increase
in income of $973,100 per household — compared to increases of 25 percent
($11,200 per household) for the middle fifth of households and 16 percent
($2,400 per household) for the bottom
In 2007, the average household in the top 1 percent had
an income of $1.3 million, up $88,800 just from 2006; well above $55,000, the
total 2007 income of the average middle-income household.
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