Memorize This...

Thanks to the Economist's View for the nice example:

...assume taxes on the Poor are 10% and taxes on the Rich are 30%.

Scenario A: GDP is 1000. Rich (a small number of people) receive 600, Poor (a large number of people) receive 400.

Taxes: Rich pay 180, poor pay 40, total is 220, Rich share is 180/220 = 82%

Now do nothing more than redistribute income from Poor to Rich:

Scenario B: GDP is 1000. Rich (a small number of people) receive 800, Poor (a large number of people) receive 200.

Taxes: Rich pay 240, Poor pay 20, total is 260, Rich share is 240/260 = 92%

Some people have found a way to argue that because the share of taxes paid by the wealthy is higher under B, 92% instead of 82%, and because the Rich pay more, 240 instead of 180, the burden on the Rich has risen. I'll take that burden if they don't want it.

It's also possible to cut taxes. Starting from scenario A once again, let taxes fall to 25% for the Rich and 5% for the Poor, and redistribute income in the same way as in B:

Scenario C: GDP is 1000. Rich (a small number of people) receive 800, Poor (a large number of people) receive 200.

Taxes: Rich pay 200, Poor pay 10, total is 210, Rich share is 200/210 = 95%

That's the rich paying 95%, up from 92% in the same economy, after a flat tax cut. I'm very soon going to start calling our tax system regressive, I am. So... the Democrats can't explain this in english because... I'm sure Krugman has eluded to the GDP as the bigger factor, construing the taxes, but an example just makes things so much clearer.

Robert Reich goes to the core of the problem, growing the economy "progressively", through a progressive tax system, which automatically leads to better social mobility if I understand him correctly.