A hot phrase these days regarding middle class taxes, particularly coming from pundits and guests on conservative TV like Fox News, is “skin in the game” — implying that the lower near-50 percent of earners in America who don’t pay federal income tax due to 1) their lack of income and 2) government programs like the Earned Income Tax Credit, need to pay something in order to warrant them receiving any benefits from Washington.
But what “game” are they referring to?
The only definition could be the game of federal income taxpayers since even the poor pay taxes if not on their income. There are plenty of middle class taxes on Americans, like the payroll taxes for Social Security, Medicare, and Medicaid that affect every worker regardless of income level on nearly every dollar they make, as well as sales taxes that hit people with nearly every item they purchase.
In fact, contributions to Social Security is capped, meaning that no matter how much you make over $106,800, you don’t pay any extra into the system. Someone making $1 million a year will pay the same amount as someone making $107,00, making that contribution seem smaller and smaller as you make more money — less skin in the game, so to speak, while still a weekly burden to the poor.
So, it’s not as if the bottom 60 percent – who, combined, earned the same amount last year as the top 1 percent of earners – have no skin in the game.
The game we should be looking at is the overall American economy, not this myopic view of only income taxpayers. It’s not some fiscally pure notion seeking fairness and equality to want everyone to pay a share of their income to Uncle Sam since these same people are not remotely in favor of taxing hedge fund managers – some making billions of dollars per year – at their equivalent income tax rate instead of the current loophole that allows them to only be taxed at the capital gains rate – which is roughly the same rate that a married couple making $25,000 would pay. For everyone to have skin in the game, per those rudimentary terms, then those clamoring for the poor to do their part should be also demanding the same of the rich.
But this isn’t about that.
The dwindling middle class already has plenty of skin in the game. They stand to lose much more than the rich if they have to pay more to the government while programs that benefit them the most get cut. Programs like public education. This year, some state colleges in California have had to raise their fees by at least 22 percent — some up to 30 percent higher than last year — because of state budget shortfalls.
The cost of education has already been skyrocketing and we all know that those with college degrees have a drastically lower unemployment rate (4.5 percent compared to 12 percent) and much higher average salary over their lifetimes than those with just a high school diploma; meaning, that as fees go up and fewer lower income families can afford to send their kids to college, that’s more people stuck in lower paying jobs — or more people going into even more debt to climb out of their station in life. As the lower classes try to stay competitive with the wealthy, they find themselves burdened with more and more debt just to keep the playing field even.
That’s just one example. And if that’s not skin in the game, I don’t know what is. Because the game is about being a member of American society, of which we’re all a part regardless of how little is collected from middle class taxes. And the more of us who are involved in the economy, the better we all are, including the very rich. Kicking the poor while they’re already bearing the overwhelming brunt of this Great Recession makes no sense.
The richest one percent of households in America possess as much wealth as the bottom 90 percent combined. That we should be damning the middle and lower classes for not pulling their weight as their wages drop, as their jobs disappear overseas, as their buying power shrinks, is sleight of hand by the plutocracy to keep our attention focused on anything but the handful of major corporations who gain more and more control over our country and its policies.
Don’t buy into it.
Photo courtesy of RLHyde’s Flickr Photostream.
