29 August 2003

Schwarzenegger's Fuzzy Math

While he is drawing attention for past groping incidents and orgy participation, Blockbuster movie star and California gubernatorial candidate Arnold Schwarzenegger's remarks on tax rates in California were notable - a signal that he buys the W. Bush neoconservative "take two tax cuts and call me in the morning" economic soulution catch-all.
"I feel the people of California have been punished enough," Schwarzenegger said last week, oblivious to the voters' self-inflicted wounds after decades of demanding adequate government services they're not willing to pay for.

"From the time they get up in the morning and flush the toilet they're taxed," Schwarzenegger wails. "When they go get a coffee they're taxed ... This goes on all day long. Tax. Tax. Tax. Tax. Tax."

But is this oft repeated mantra that the public readily accepts grounded in truth? Columnist Paul Krugman says it's fuzzy math and has published a set of numbers that prove otherwise. For all but a fifth in the top income bracket, the state and local tax burden for California residents is lower than the national average.

Group Nation California
Bottom 20 % 11.4 11.3
Next 20 % 10.3 10.2
Middle 20% 9.6 9.2
Fourth 20% 8.8 8.7
Next 15% 7.7 8.1
Next 4% 6.5 7.6
Top 1% 5.2 7.2

Nationally, state and local taxes are highly regressive, and have become considerably more regressive over time. California's system is regressive, too, but not as much so as the national average. The result is that the typical California family pays less than the national average, but the well-off pay more.

So this is an alternative explanation of Ahnuld's remarks about the burden of taxes: he wasn't just mouthing right-wing cliches, he was reflecting what he sees. The kind of people he hangs out with do pay substantially higher taxes in California than they would if they lived in a red state. But the great majority of Californians aren't wealthy, and they also aren't highly taxed by national standards.

Of course, most folks never venture to explore the story and accept the talking heads propagation of myth at face value...


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