With Taxes On Wealthy Down And Inequality Up, Public Support For Tax Increases Grows
The New York Times' Catherine Rampell pulls together some polling data on the use of tax increases to reduce deficits:
Congressional Republicans may have become more anti-tax in the last 30 years, but the American public has made the opposite transition: in March 1982, three-quarters of Americans said spending cuts alone should be used to reduce deficits; today, about the same share say tax increases should be included in any debt-reduction package.
Here's the poll data Rampell compiled, along with the preceding year's top marginal tax rate:
(Rampell included two polls from 2011; I used only the more recent, which showed slightly less support for tax increases. The chart shows the percentage of poll respondents who favored tax increases alone or as part of a package.)
At the same time, capital gains taxes — paid primarily by the rich — have been cut in half, allowing some of the wealthiest taxpayers to pay a lower effective tax rate than their secretaries. The rich have grown richer, while everyone else has struggled to stay afloat, leading to ever-rising income inequality:
So, over the past few decades, taxes have repeatedly been cut, primarily to the benefit of the richest Americans, whose wealth has skyrocketed, while the rest of the country has seen its income stagnate. Those tax cuts have contributed to significant deficits, which politicians have increasingly tried to reduce via spending cuts rather than by rolling back tax cuts for the rich. (And Republicans react to these trends by trying to slash taxes for the super-rich even further.) Little wonder, then, that the public increasingly prefers deficit reduction packages that raise taxes on the rich rather than those that simply increase the retirement age and slash spending.