Been reading DQYDJ for a while? Good. You know that looking at data from a different angle yields very interesting insights.
Here’s one interesting thing: the federal income tax code benefits 18 to 35 year olds at the expense of 45 to 65 year olds. How do I figure? The IRS helpfully posted data for 2009 (links are xls files) on both the amount of income made by age group and the amount of Federal income taxes paid after credits. So, should the Silent Generation and Baby Boom Generation be mad at Generations X and Y? Partially! Read on.
Share of Income Made and Taxes Paid
Here is a beautiful graph of the total income tax burden, sliced down into 10 year tranches.
Have You Thanked a Baby Boomer Today?
The Baby Boomers get a bad rap – they assume a huge amount of the power positions in the House of Representatives, the Senate, and the Executive Branch (President Barack Obama was born in 1961). However, since they fall in the ages 45-65 in 2009, that would mean the Baby Boomers (well, and the last year of the Silent Generation) were paying the majority of taxes in the country (54.06%) while earning less than half of the income (46.61%). Additionally, Baby Boomers receive less in benefits than do the other generations. As noted in this Special Report from the Tax Foundation,
America’s youngest households aged 25 and under received $2.32 in government spending for each dollar of taxes paid in 2004. Middle-aged households aged 45 to 54 received $0.73 per tax dollar, and America’s oldest households aged 75 and over received $4.93 per dollar of taxes paid. (Read the rest)
Even more interesting: a vast amount of the payments that go into those federal programs are from payroll taxes, as opposed to income taxes as detailed in the chart. So, in a nutshell, the Baby Boomers should be mad at everyone. However, the whole world is mad at them, and they are shouldering the blame. Isn’t it funny how that works?
So, are you ready to put away the hatchets you’ve got aimed at the Baby Boomers? Or are you convinced that they set it up this way so they should shoulder the blame? Fight/comment away!