Who’s Really On the Government Dole?
July 17, 2017
I constantly hear from my hard core Republican friends, aka Trump supporters, that they are “tired of paying for the lazy poor people who live off the government dole.” But I quickly respond to them with a question – “Do you know which tax deductions cost the government the most money?’’ They stammer around and usually say welfare, which doesn’t even exist anymore. So I clearly state which tax deductions cost the most money:
- Lower rate for capital gains
- Business health care deductions
- State & local tax deductions
- Mortgage Interest rate deduction
- Tax breaks for retirement savings
And who gets nearly 90% of these government handouts? The top 20% of wage earners, with the top 1% absolutely killing it with these deductions. These tax breaks are triple the amount that the bottom 50% of the country gets through deductions such as the Earned Income tax credit, child credits, health insurance subsidies, etc. Yet the common perception in America is that the bottom 50% of America, the “working poor,” are the ones that tax most advantage of the system.
Now I am a believer in a flat tax and wiping out all deductions, but in this polarized political environment that allows legalized bribery (known as “lobbying”), there are two chances we could get a bi-partisan compromise to get this done – slim and none.