South By North Strategies, Ltd.

David Callahan of Policy Shop debunks yet again the myth that almost half of all Americans pay no taxes.

The most obvious problem with this statistic, as many have pointed out before me, is that the narrow phrase “federal income tax” is misleading — and, it would seem, deliberately so. Every tax analyst at [the] Heritage [Foundation] well knows that federal payroll taxes, for Social Security and Medicare, now bring in nearly as much federal tax revenue as income taxes — and also know that a great many Americans pay more in payroll taxes than income taxes.
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Yet the payroll tax is barely mentioned in the Index of Dependence. Beyond obscuring the truth, this omission distracts attention from another important flaw of the report: Which is that many Americans who are supposedly wards of the state, “dependent” on Social Security and Medicare, are actually drawing on programs that they spent their working lives paying into. What’s wrong with that? We don’t go around talking about how retirees are  “dependent” on their 401k nest eggs.