Too Much Deficit, Not Enough Rich People

America’s deficit problem, says National Review ‘s Kevin D. Williamson , is that the rich don’t have enough money. Even if you raise taxes on everyone earning $250,000 a year, you couldn’t raise enough revenue to cover this year’s deficit:

Nonetheless, there aren’t that many of them. In fact, in 2006, the Census Bureau found only 2.2 million households earning more than $250,000. And most of those are closer to the Lubbock city manager than to Carlos Slim, income-wise. To jump from the 50th to the 51st percentile isn’t that tough; jumping from the 96th to the 97th takes a lot of schmundo. It’s lonely at the top.

But say we wanted to balance the budget by jacking up taxes on Club 250K. That’s a problem: The 2012 deficit is forecast to hit $1.1 trillion under Obama’s budget. (Thanks, Mr. President!) Spread that deficit over all the households in Club 250K and you have to jack up their taxes by an average of $500,000. Which you simply can’t do, since a lot of them don’t have $500,000 in income to seize: Most of them are making $250,000 to $450,000 and paying about half in taxes already. You can squeeze that goose all day, but that’s not going to make it push out a golden egg.

Okay, so what if you add those making less than 250K a year:

So, how about taxing people who make less than $250,000? That’s probably whom you want to tax, since they are the ones who have the money (Counterintuitive, I know.) The Bush “tax cuts for the rich” cost the Treasury about $800 billion in forgone revenue; the Bush tax cuts for the middle class cost  trillions – 2.2 of them, to be precise.

Repealing all of those Bush tax cuts, for rich and middle class alike, gets you about $3 trillion — over  ten years . The deficit is running from a third to almost half that  every year. Will not balance. Does not compute.

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