From: pjm@anegada.sps.mot.com (Patrick J. McGuinness)
Subject: Re: <None>
Followup-To: alt.activism.d
Originator: rich@pencil.cs.missouri.edu
Organization: SSDT SPS, Motorola Inc., Austin TX
Date: Mon, 12 Oct 1992 21:16:47 GMT

In article <1992Oct9.134728.1731@falcon.aamrl.wpafb.af.mil> bkottmann@falcon.aamrl.wpafb.af.mil (Brett Kottmann) writes:
>In article <1992Oct8.044032.9744@mont.cs.missouri.edu>, harelb@math.cornell.edu (misc.activism.progressive co-moderator) writes:
>...
>>     "WASHINGTON-- 90% of American families pay more in federal taxes
>>     now than they would if the tax laws existing in 1977 had been left
>>     in place, Citizens for Tax Justice reported Thursday.
>
>	It seems like only yesterday that we debunked this "report".  Okay, so
>it was last month.  Guess the map crowd is experiencing a dearth of new
>propaganda.

This endless stream of diatribe-as-statistics from harelb wouldn't be
so bad if he didn't keep repeating the same tired old misleading 
statistics.  Herelb seems to be the everready battery of t.p.m:
he keeps posting, and posting, and posting .... the same stuff. 
Harel, at least give us something *new* to debunk once in a while. :-)

Elements of the previous debunking:
1. Using 1977 as the start year so they could sneak in the massive
Soc Sec tax increase passed by Carter and the Democratic Congress, as
well as their hidden bracket creep income tax increases.
2. Using "flat-earth" economics that assumes changes in tax laws and
rates have no effect on taxpayer behavior.
To them, doubling the tax rate on the rich leads to massive
increases in revenues ... One problem with this: when we *cut* the tax rates
on upper-income taxpayers, the revenues increased.  The wealthy paid a larger
share of the total in income taxes collected in 1990 than in 1980, even
though rates were lower.
3. Making up numbers out of thin air "X would be Y if ..." And if
pigs can fly.

I preserved the unvarnished wisdom of Brett on what was wrong
with the report the last time it was posted, included below.
(I interspersed a few of my own additional comments).

Pat
-----------------------------------------------------------------

        And here's how they cooked the books:

        "After 15 years of tax "cuts" and "reforms" the inflation-adjusted
take-home pay of the great middle of the US economy is actually a little less
than it was in 1977."  CD, page 67.   (CD=Consumer's Digest, October, 1992)

        Their implication is that *every* tax act since 1977 has been a
supply-side maneuver.  Obviously this is bullshit, but they are hoping all you
ever see (courtesy of useful fools like H*r*l) is the headline.

        "Cutting the tax rates on the highest-earning individuals and
corporations was sold to the public as a way to *increase* tax revenues
(incredible as that may sound in retrospect); tax revenues promptly fell."
CD page 68.

        Geeze, so many lies in one sentance!  Where to begin?

        Let's start with "tax revenues promptly fell".  From *what*?  They
don't specify a particular tax act, just assert "promptly fell".  The *only*
way they can even remotely justify such statement is to allude to what happens
when you withdraw money to invest in the stock market.  Your bank account
"promptly falls".  Of course they are ignoring the fact that after the Reagan
tax cuts (which cut taxes for *everyone*), revenues increased.
        That for every *tax cut* in the capital gains tax, revenues
*increased*.  The first time they were raised (in 1986) *revenues fell*.

        So while it is "incredible" to this group that these cuts were "sold"
as a way to increase revenues, they never say if their incredulity lasted
beyond seeing revenues actually increase :).

        "Black is white; 'cut' means _increase_.  But what is most galling for
anyone earning between $20,000 and about $85,000 yearly is a simpke fact:
Despite all the claims about "across the board" tax cuts, your taxes aren't
lower.  Compared to 1977, all but the poorest and very richest (top 5 percent)
Americans now pay a _higher_ share of their incomes in overall federal taxes."
CD page 69.

        Here again we see the classification of every tax change as a "tax
cut".  They also are apparently sad that the poor are paying less taxes :). 
The intent is to debase supply-side economics.  Too bad (for them :) that most
people can tell the difference between a tax cut and a tax hike :).

[Pat: Right These guys don't want you to know a singular fact. The *reason*
that most working class and middle-income Americans are paying more
is that Social Security taxes were raised significantly in 1977.
Now the tax rate is over 15% (employee plus employer contribution)
for workers .... this has NOTHING to do with "across the board tax cuts".
This was an across the board tax increase.
If they used *1981* as a baseline year, the conlcusion would be very
different.]

        "That means that Congress and the executive branch raised taxes on
three of every four American families and managed to collect some $76 billion
_less_ in federal taxes in the process (the $92 billion in cuts for the
fortunate few minus the extra $16 billion from everyone else)." CD page 70.

        Completely *ignoring* the real numbers, they say "if taxes were cut by
N billion (let's suspend their assertion that there were no real tax cuts :),
that's obviously N billion *less every year thereafter*.  Hey, guys, really. 
Check the actual revenue numbers, ok?

[Pat: Right - revenues in 1987 were a few hundred billion *higher*
than in 1981. ]

        It get's better, though!  They then try to extrapolate the N billion
into M trillion more in debt.

>     But the very rich, as a result of tax-law changes over the last 13
>     years, are paying up to 36 percent less than they would have, the
>     group said.

        Of course, no *real* numbers are used.  They simply made them up.  If
you take $10 out of your pocket, you obviously will always have $10 less,
right? :\


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