Amity Shlaes

Amity Shlaes: The Forgotten Man

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Income Distribution, Malanga, Florida, Cities

by Amity Shlaes
March 11, 2009

New Yorkers know their taxes are going up and are thinking about whether they can handle it. The professional crowd, especially, is concerned. Why not move out?

An old column on Real Clear Markets by Steve Malanga of Manhattan Institute is worth going back to because it lets you know how very much the top earners in NYC pay relative to other taxpayers. In one recent year the top income bracket crowd, less than one percent of the taxpayers, paid one third of the state income tax.

Reason to care: the tax burden in NY is one factor that is speeding Washington’s victory and New York’s defeat in the epic competition of the capitals.  The excellent Richard Florida had an optimistic piece in The Atlantic recently, where he said that “New York is much, much more than a financial center.” In terms of tax revenues, however, being a financial center matters.

4 Comments

  • Posted by Austin Norman

    First of all you are not telling the whole story here so this is very misleading. I have no doubt that the richest 1% pay MOST the taxes, but that doesn’t mean they paying a higher amount of interest, and it doesn’t mean they are paying a “fair amount”. In other words if a very rich person only paid 10% tax on the 100 million he made last year and the poor little guy paid 30% tax on his 50,000 he made; looking at this it would appear the rich guy paid way more in taxes in terms of dollar amounts, but NOT percent wise. The system is very unfair and as even Warren Buffet has stated, he pays less taxes percent wise than his secretary does. This happens because the “investing class” makes long term capital gains which are only taxed at 15% and aren’t considered earned income which means it doesn’t go toward social security. Then corporate dividends which aren’t considered earned income either, will not go to social security. Social Security is a total scam and ponzi scheme anyway which never gives what you put into it so I call it a tax. This same investing class is rewarded for not working or earning money because they don’t pay social security, and they are taxed in small percentages like 15%. It’s also corrupt because it’s implying that you are a real fical idiot if you have to work and earn your money. Haha! Yeah! Well, you would have to be a real jerk to have work to get your money, after all smart people don’t work for money do they? So basically if I owned a million shares of Wal-Mart I wouldn’t have to pay any Social Security on the 1,090,000 I would make a year in dividends compared the poor slob who had to work 8 hours a day and only made 50,000. Not only that when the assets go up in value which Wal-Mart probably will, I will only have to pay 15% capital gains tax; how on earth Ms. Shlaes do you say that’s a fair system?

  • Posted by InnocentQuestioner

    Amity writes:

    “In one recent year the top income bracket crowd, less than one percent of the taxpayers, paid one third of the state income tax.”

    Hmm, those seem to me to be the wrong factors to compare if you really want to know “how very much the top earners in NYC pay relative to other taxpayers.” The percentage of the population in the top bracket (1%) doesn’t really bear on its share of income taxes. What bears is the top bracket’s share of total income.

    For example, if less than 1% of the population earns, say, two-third of total income, but pays one-third of taxes, then we are in a position to ask more meaningful questions, such as whether the New York income tax is sufficiently progressive, and whether income inequality in the state is growing, and to what degree did atypical inequality contribute to the New York-centered financial crisis.

  • Posted by Austin Norman

    Fair enough, you argument certainly has some credence. You could argue all kinds of things in this area and it would be hard to prove invalid. Another argument is that the “capitalist class” of the U.S. should pay less taxes percent wise than poorer people because they need to money to keep their businesses going and employing more of the poorer class.

  • Posted by RALPH

    Wow! what an idea ! What a concept ! Beautiful .. Amazing