Friday, August 13, 2004

Origami Statistics

I've been saying and thinking for awhile that the tax burden went UP for the middle class. But I don't really like the way they are framing their information in this article.

People in the top 20 percent of incomes, averaging $182,700 a year, saw their share of federal taxes decline from 65.3 percent of total payments in 2001 to 63.5 percent this year, according to the study by congressional budget analysts.

In contrast, middle-class taxpayers — with incomes ranging from $51,500 to $75,600 — bear a greater tax burden. Those making an average of $75,600 had the biggest jump in their share of taxes, from 18.5 percent of all payments in 2001 to 19.5 percent this year.

I mean, how many people make up each group? Are these the same quintiles that the Census uses? How much movement has there been in the income levels of those quintiles?

The study is based on figures in 2001 and assumes no changes in wealth distribution from increases in income, dividends or capital gains.
I would like a more in-depth analysis. But I can't argue with these paragraphs:

Bush-Cheney campaign spokesman Steve Schmidt said, "Because of President Bush's policies every American pays less in taxes today than they did before he became president...John Kerry (news - web sites) has promised to raise taxes during the campaign. That is the clear choice Americans will have in the fall elections."

The study found that the effective tax rate for the top 1 percent of taxpayers dropped from 33 percent in 2001 to 26.7 percent this year, a decline of 19 percent. The middle 20 percent of taxpayers saw a decline of 4 percent.

As the old saying goes, we should beware of using statistics like a drunk uses a lightpost. For support instead of illumination. But the numbers presented do lead me to believe that a deep analysis would prove very illuminating.

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