Ezra Klein: Obama Tax Plan Supports the Middle Class

[babylonsister]

http://voices.washingtonpost.com/ezra-klein/2010/08/more_tax_charts.html

More tax charts!

Last week, I posted a graphic showing how many dollars various income groups would save under the Bush and Obama tax plans. The basic takeaway was that the middle class would do a bit better under Obama's plan and the rich would do a lot better under Bush's plan. But wait!, some of you said. That graph doesn't show the percent of taxes both groups pay!

Well, of course not. The percentage of taxes both groups pay is neither here nor there in a direct distributional comparison of the two tax plans. The fact that the rich pay more in taxes than the poor doesn't mean they should get a larger tax cut than the poor. Nor does it mean they should get a smaller cut. The distributional comparison is a fact about the plans. What you think about that fact is up to you.

But here at Klein Industries, we aim to please. So here's a chart (pdf) from Brookings's Adam Looney (thanks, Jon Chait!) which compares the value of the Obama and Bush tax plans as a proportion of after-tax income. That way, it's adjusted for the size of each group's total income. Click on it for a larger version.



What you can see there is that even in percentile terms, the Bush tax cuts do much more for the incomes of the rich than the poor, and the Obama proposal would do a lot more for the poor than for the rich. Make of this what you will.