3 Right-Wing Lies About Rich People and Taxes -- Debunked
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In an effort to discredit President Obama's plan to increase taxes on the wealthy, conservative media outlets have pushed a number of myths to suggest that a large number of Americans will be negatively affected. In reality, only a small percentage of taxpayers would be affected by Obama's proposals.
1. MYTH: Those Who Earn $250,000 In Income Are Not Wealthy
Levin: Those Who Earn More Than $250,000 Are The "So-Called" Rich. On the November 9 edition of Fox News' Your World with Neil Cavuto, conservative radio host Mark Levin implied that those making over $250,000 are not legitimately rich, claiming that President Obama's plan to raise taxes on high-income earners is "trashing the so-called rich." [Fox News, Your World with Neil Cavuto, 11/9/12, via Media Matters]
Willis: "Lots And Lots" Of Middle Income People Make $250,000 A Year. On the November 9 edition ofMarkets Now, Fox Business host Gerri Willis attempted to portray a tax increase on high income earners as one that affects a large number of Americans. From Markets Now:
WILLIS: Then we get an AP story this afternoon with Jay Carney, the president's spokesperson, saying that the president will veto any legislation that raises taxes on the wealthy. Now we don't know if that means people who are earning 250,000 or more, which is what the president frankly has said in the past and in this part of the country where we live lots and lots of people, lots of middle income people make that amount of money between the two incomes. [Fox Business, Markets Now, 11/9/2012, via Media Matters]
Charles Payne: $250,000 Threshold Not The "Real" Definition Of Rich. On the November 14 edition ofAmerica Live, frequent Fox contributor Charles Payne derided Obama's plan to increase tax rates on households making more than $250,000 a year, claiming that this income threshold does not reflect the "real" definition of rich. From America Live:
PAYNE: You know, realistically, I think the question is a lot of people resign themselves to the idea that taxes are going to go up. The real thing is how do you define rich. I think this is really the big sticking point, and this where I have a big problem because 250,000 certainly is not the real definition of rich and certainly that's not where the average American family who gets to that point should be punished for all the work that they put in. [Fox News, America Live, 11/14/2012]
REALITY: Very Few Americans Make More Than $250,000 A Year
Census Bureau Data: Median Household Income In U.S. Far Below $250,000. According to the most recent Census Bureau data, median household income currently stands at $50,054, about one fifth of the threshold for Obama's proposed tax rate hikes.
Tax Policy Center: Only 6 Million Americans Earn More Than $200,000. According to the non-partisan Tax Policy Center, "about 6.07 million Americans earned above $200,000 in 2011," making up the top 4.2 percent of taxpayers. The Tax Policy Center and the Census Bureau do not publish data for those earning above the $250,000 threshold.
Politifact: Only 2 Percent Of Households Earn More Than $250,000. A Politifact article reviewing claims made by President Obama found that, according to the Internal Revenue Service, less than 2 percent of earners reported income higher than $250,000. From the article:
Using statistics from the IRS website, we found that 137,988,219 tax returns out of 140,494,127 -- or 98.2 percent -- reported adjusted gross income of less than $250,000 a year in 2009, the most recent data available. [Politifact, accessed 11/19/2012]
2. MYTH: Lower Top Tax Rates Benefit Everyone, Higher Top Tax Rates Bad For Growth
The Wall Street Journal: Lower Tax Rates Good For Everyone. In a November 15 opinion piece titled "Why Lower Tax Rates Are Good for Everyone," WSJ editorial board member Stephen Moore argued that "over the past century, lower [tax] rates have shifted the tax burden onto high-income earners and away from the middle class." Moore argues that lower tax rates are responsible for economic growth and thus raise middle-class living standards. From The Wall Street Journal: