According to the Republicans, America's taxes are a crushing burden that are ruining our economy. But are our taxes too high? "No," says a story in USA Today last year that apparently got little attention:
Federal, state and local income taxes consumed 9.2 percent of all personal income in 2009, the lowest rate since 1950, the Bureau of Economic Analysis reports. That rate is far below the historic average of 12 percent for the last half-century. The overall tax burden hit bottom in December at 8.8 percent of income before rising slightly in the first three months of 2010.
The Republicans insist our corporate tax rates are too high, and they're absolutely right. They're right, that is, as long as one looks only at the nominal rate and pays no attention whatsoever to deductions, loopholes, and tax breaks. Why? Because if we consider those deductions and loopholes, then the exact opposite is true. According to AlterNet.org:
As a share of GDP, the U.S. had the second lowest tax rate, behind only Iceland. This statistic flips on its head the often repeated Republican charge that America has the second highest corporate tax rate in the world (which is only true on paper). In 2009, U.S. corporate taxes had fallen to only 1.3 percent of GDP, from 4 percent in 1965.
The Center for American Progress has an interesting series of ten charts that show just how far our national tax burden has fallen in the past 50 years, and how low it is compared to nearly all other developed nations.
And then there's the terrible, terrible federal deficit we have. To be sure, we'd all like to see it go away. In fact, we were on track to have the entire national debt paid off by 2012 if only George W. Bush had been willing to maintain the surpluses that he was handed by Bill Clinton. But how bad, exactly, is the deficit? Here's a list of the federal deficit as percentages of GDP compiled by data360.org, first for the budgets submitted by Ronald Reagan (the first one he actually submitted was for 1982, just as the first budget Obama actually submitted was for 2010):
1982 -3.9 percent
and then for the most recent four years: