Who’s More Deceptive, Warren Buffett or Peter Ferrara?
“Warren Buffet [sic] is performing a gross public disservice in creating urban myths about the nature of the tax system in America,” writes Ferrara. “Those myths will mislead millions of Americans about the fundamentals of their own country.”
Ferrara complains about Buffett’s recent NYT op-ed titled “Stop Coddling the Super Rich,” claiming that Buffett was inaccurate to say that “But if you earn money from a job, your [average federal tax rate] will surely exceed mine — most likely by a lot.” Immediately, Ferrara begins to obfuscate: “Official IRS data shows that for 2007, before President Obama was even elected, the top 1% of income earners paid more in federal income taxes than the bottom 95% combined.”
Ferrara obviously knows that Buffett was talking about all federal taxes, including payroll taxes. I mean, everybody knows that’s what this is about. But Ferrara plays dumb and totes out the stat about the top 1% paying so much more income tax in 2007 (40.4%) than they did in 1981 (17.6%).
“That top 1% paid 40.4% of all federal income taxes,” writes Ferrara, “almost twice their share of income.”
Of course, he chooses not to mention that in 1981 the top 1% paid more than twice their share of income. Of that while their income tax share increased by 130%, the share of all income brought home by the top 1% increased from 8.3% to 22.8%, or 175%. In other words, the share of tax paid by the rich hasn’t come close to keeping up with their skyrocketing income share.
Seriously, is anybody surprised by this? I’ve written before that people like Ferrara really shouldn’t want anybody thinking about average federal tax rates because average folks would be shocked at how high their taxes are compared to the very wealthy.
But wait, what was the question? Oh yeah – who’s more dishonest, Buffett or Ferrara?
How about we look at data selection. Ferrara’s choice of data for his single comparison is telling. He didn’t choose the 1980 data, but instead the 1981 data. And he didn’t choose the latest data from 2008, but the data from 2007 instead. Why do you think that is?
Simple. During the 1981 recession the wealthy paid the lowest share of income tax on record. And at the peak of the pre-2008 boom they paid the highest share on record.
If Ferrara were confident of his argument, he wouldn’t have to cherry pick his data.