Yes, the top 53% of taxpayers are being unfairly soaked

Percentages can be mind-numbing, so for reference, let’s talk cash: using round numbers, the top 50% of earners pay more than a $1 trillion dollars in federal income taxes; the bottom 50% pay about $35 billion.

If “wealthy” means the top 5% of incomes, what is “fair” for that group? Should they pay 70%? 80%? As Leonhardt concludes that taxes paid by this group should increase, their share of taxes will also increase. A progressive tax system is a tradition in the United States, but is a system this steeply progressive fair? Fair or not, it’s neither effective nor efficient — and, at any rate, it’s not sustainable. After a while you simply run out of wealthy people to tax…

Everyone in the bottom 50% would rather find themselves in the top 50%, and with the usual labor mobility in America, a large proportion of them will get there. Nonetheless, on a pure cash basis, it’s hard to make a case that people in the bottom 50% are somehow being cheated by the tax code.

And this group is, in fact, growing. The number tax filers with no net tax liability has grown steadily, and the benefits extended to this group are also increasing – most recently by the huge expansion of Medicaid and health subsidies in the health reform bill.