Bruce Bartlett on the actual IRS rates vs. perceived rates:
According to the CBO, the highest figure for all federal taxes since 1970 came in the year 2000, when they reached 20.6% of GDP. As we know, after that George W. Bush and Republicans in Congress cut federal taxes; they fell to 18.5% of GDP in 2007, before the recession hit, and 17.5% in 2008.
Tuesday’s Tea Party crowd, however, thought that federal taxes were almost three times as high as they actually are. The average response was 42% of GDP and the median 40%. The highest figure recorded in all of American history was half those figures: 20.9% at the peak of World War II in 1944.
To follow up, Tea Partyers were asked how much they think a typical family making $50,000 per year pays in federal income taxes. The average response was $12,710, the median $10,000. In percentage terms this means a tax burden of between 20% and 25% of income.
Of course, it’s hard to know what any particular individual or family pays in taxes, but according to IRS tax tables, a single person with $50,000 in taxable income last year would owe $8,694 in federal income taxes, and a married couple filing jointly would owe $6,669.
But these numbers are high because to have a taxable income of $50,000, one’s gross income would be higher by at least the personal exemption, which is $3,650, and the standard deduction, which is $5,700 for single people and $11,400 for married couples. Owning a home or having children would reduce one’s tax burden further.
According to calculations by the Joint Committee on Taxation, a congressional committee, tax filers with adjusted gross incomes between $40,000 and $50,000 have an average federal income tax burden of just 1.7%. Those with adjusted gross incomes between $50,000 and $75,000 have an average burden of 4.2%.
Even though the Tea Partyers were specifically asked about federal income taxes, it’s possible that they were thinking about other federal taxes as well, such as payroll and excise taxes. According to the JCT, when all federal taxes are included, those earning between $40,000 and $50,000 have an average tax rate of 12.3%, and those earning between $50,000 and $75,000 pay a rate of 14.5%.
To be fair to the Tea Party dimwits, these taxes are paid to the same source (IRS); it’s not easy distinguishing Social Security from IRS taxes if both come out of your paycheck. Adding to this perception are state-based taxes, which take the form of sales-taxes and property taxes. In Texas, the sales tax in my district is 8.25%. Contract workers are used to paying 16% off their income (which combines Social Secure/Medicare/IRS), so if you throw the rest of the taxes in, it’s not unreasonable to guess it being over 25%. Also, I’d be curious about how much higher the rates are if your household income is closer to 100,000.
After Obama’s announcement that the East Coast would be potentially open for offshore drilling, here are estimates about how it will affect the oil supply from EIA:
… access to the Pacific, Atlantic, and eastern Gulf regions would not have a significant impact on domestic crude oil and natural gas production or prices before 2030. Leasing would begin no sooner than 2012, and production would not be expected to start before 2017. Total domestic production of crude oil from 2012 through 2030 in the OCS access case is projected to be 1.6 percent higher than in the reference case, and 3 percent higher in 2030 alone, at 5.6 million barrels per day. For the lower 48 OCS, annual crude oil production in 2030 is projected to be 7 percent higher—2.4 million barrels per day in the OCS access case compared with 2.2 million barrels per day in the reference case (Figure 20). Because oil prices are determined on the international market, however, any impact on average wellhead prices is expected to be insignificant.
Similarly, lower 48 natural gas production is not projected to increase substantially by 2030 as a result of increased access to the OCS. Cumulatively, lower 48 natural gas production from 2012 through 2030 is projected to be 1.8 percent higher in the OCS access case than in the reference case. Production levels in the OCS access case are projected at 19.0 trillion cubic feet in 2030, a 3-percent increase over the reference case projection of 18.4 trillion cubic feet. However, natural gas production from the lower 48 offshore in 2030 is projected to be 18 percent (590 billion cubic feet) higher in the OCS access case (Figure 21). In 2030, the OCS access case projects a decrease of $0.13 in the average wellhead price of natural gas (2005 dollars per thousand cubic feet), a decrease of 250 billion cubic feet in imports of liquefied natural gas, and an increase of 360 billion cubic feet in natural gas consumption relative to the reference case projections. In addition, despite the increase in production from previously restricted areas after 2012, total natural gas production from the lower 48 OCS is projected generally to decline after 2020.
After a family member forwarded a bogus rant about the unconstitutionality of health care reform, I found that the Wyden amendment specifically allows states to opt-out and devise their own solution. It states:
b) Granting of Waivers-
(1) IN GENERAL- The Secretary may grant a request for a waiver under subsection (a)(1) only if the Secretary determines that the State plan—
(A) will provide coverage that is at least as comprehensive as the coverage defined in section 1302(b) and offered through Exchanges established under this title as certified by Office of the Actuary of the Centers for Medicare & Medicaid Services based on sufficient data from the State and from comparable States about their experience with programs created by this Act and the provisions of this Act that would be waived;
(B) will provide coverage and cost sharing protections against excessive out-of-pocket spending that are at least as affordable as the provisions of this title would provide;
(C) will provide coverage to at least a comparable number of its residents as the provisions of this title would provide; and
(D) will not increase the Federal deficit.
In other news, the House of Commons exonerates Alex Jones of any ethical or professional wrongdoing with the CRU hacked emails. IPCC’s Pachauri is cleared of financial wrongdoing and (a while back) Michael Mann is vindicated (and so is his hockey stick data). Funny, these spurious charges all made the front page of the NYT website; where are the retractions? I expect the same lame hockey stick criticism to keep getting recycled for the next century.