Friday, December 12, 2014

Who Pays for Government?

Naturally, the case is different for each individual. There are cronies at the top, who are net beneficiaries of government spending. and there are hardworking folks in the lowest quintile who are net tax payers, but taken as a group. the top quintile is the big loser when it comes to government money transfers.


  1. All the money poor people receive just ends up in the hands of walmart share holders. Whatever quantity of cash temporarily sits in the hands of poor American'ts, it is a pittance compared to the net flow of real assets from poor to (super duper)rich due to fed money manipulation. The "rich" guy most Americans imagine is the dude down the street with the nice car or your asshole boss, but difference between Joe Shmoe making 20k/year amd his boss making 200k/year is pocket change compared to what "Connected Statist Tick Monster" brings home. Never mind that poor people bear the brunt of statists failures. "Rich" people may put up the cash for government, but that is the least of its costs. Who gets murdered by cops? Who goes to prison for non-violent drug crimes? Who dies in the endless wars? Who gets raped in the orphanage?People with power trick people with something lose into fearing people with neither to keep a check on both. Keep the field slaves envious of the house slaves, instill in a house slaves a disdain for the field slaves and make the house slaves see the master as their protector from the wrath of wretched field slaves. Divide and conquer.

    1. Your Walmart example is flawed since the people spending money there are getting something of value for money they did not have to work to get. They come out ahead in that transaction no matter how you look at it. While Walmart shareholders, employees and vendors certainly benefit from government transfer payments to the poor, its still money coming from mostly the top tiers and being redistributed to the poor and then to the Walmart corp and on to its employees, shareholders and vendors. As for wealth being transferred from the poor, that is also doubtful even considering the impact of inflation on what they buy with their small incomes, that are mostly unearned. Once again, most of the wealth transfer is coming from those that have high non-tax preferential incomes (ie wages, business income, pensions), which are the upper middle to lower rich class ($2m and under-- which is also where the bulk of the income tax revenue comes from).

      I do agree that poor (really the underclass) bear the brunt of the statist policies designed to help or manipulate their behavior, but that's the idea behind Progressive government and its doubtful that's going to change.

    2. That's like saying federal guarantees on student loans are a hand out to students. Clearly they are a handout to schools. Absent the guaranteed loans, schools would have to lower their prices or teach to empty classrooms. Similarly, absent food stamps, walmart would have to lower it's prices or have no customers. Food stamps drive up food prices just like student loans drive up education costs. Furthermore it is the government that traps poor people in the social "safety" web with minimum wage laws and endless business regulations. The poor man receiving the food stamps who is kept from his first job by minimum wage laws is harmed much more than the wealthy man who was robbed to provide the food stamps and the salaries of those who enforce the minimum wage laws. Once again, the bulk of the "cost" of government programs is not the money lost to these thieves, it is the lives destroyed by the mischief they cause with the money.

  2. What are the government transfers that it shows all groups receiving?

  3. The US has the 2nd most Progressive income tax in the world. Little wonder that almost all of the income taxes are paid by the top quintile.

  4. So every other metric gubbiment hands out is gamed (CPI, employment, etc.) but this isn't?

    If you believe this BS by the CBO you are a fool, or don't have friends among the lowest quintiles. I'm in one or the other, and I can assure you that the gubbiment cheez isn't handed out w/o a crapload of qualifiers (disabled, scads of kids, etc.).

    This also fails to take into account every other way they tax us other than income. Once you include all the ways gubbiment takes your money (call it a fee, surcharge or tariff - a tax by any other name is still a tax), that gap disappears.

    Of course, nobody bothers to run those figures, otherwise the proles would really get uppity.

    1. I'm not sure how someone who makes between 15,000 and 30,000 could pay more in total taxes than someone who paid 57,000 in federal taxes alone. I suspect the bigger issue might be #2, Gov. transfers. Over 70% of transfers are NOT means tested: that's dollars going to Medicare, Social Security, etc.

      But, I'm not sure it's a good idea for libertarians to be publishing this type of information anyway (i.e., the rich pay all the taxes!). You can't defeat envy with facts. A better approach is to turn it around, pointing out to the masses cases where the rich are getting the largess, whether it's Medicare, crony legislation, college funding, etc. Or that, in the long run, federal funds targeting the poor are harmful.

      Your point is interesting though. I would like to see those figures. Hard to account for everything though. Ultimately you want to know what was the net benefit vs the net payment in? But "net benefit" is subjective. Argue the point far enough and the whole concept of benevolent gov. disappears.

    2. @ Axel

      He does make a good point. I'm assuming the above is limited to income tax only. When you take into account sales taxes, etc., then all of a sudden the "other" taxes poor people pay hurt way more because I greater % of their income is spent on food, shelter, etc. than a rich person.

      I agree on your point, "you can't defeat envy with facts" btw....but it's probably important to remember that people who would like to be rich is a good thing(certain types of envy) as long as they don't take that desire to the extent of criminality...and encouraging the gov't to steal from other people might qualify....

  5. Forced benevolence is an oxymoron which is the best way to describe the concept of a benevolent government. While the concept of a "benevolent government" continues on in the demented minds of many people, it can never exist in reality. It is a myth and the numbers in the chart are meant to continue this myth. Nothing more can be learned from it.

  6. I'm disappointed with this post, especially since this was only recently posted on

    If the term "federal taxes" is used, throw it in the trash. That almost always means they don't even count the payroll tax, which is like 20%, even on dirt poor people.

    And it sure as hell does not count property taxes, state income taxes, sales taxes, or the impact of corporate, inheritance, and inflation taxes.

    How about the recession tax? The war tax? The trade barrier tax? The state cannot calculate, but hey, let's use the state's figures!

    Rather than dividing by income, to tell anything close to the truth, it would have to be taxes paid over life vs. transfer payments received. Older people are the wealthiest age demographic, but their earned incomes may be quite low, while receiving the largest transfer payments.

    But what is the unseen cost of those transfer payments? It is not as if they did not pay taxes at any point up until they started receiving them.

    And many die before they can receive anything at all. It's still a transfer from poor to rich.