2011/09/24

Tax Math

I noted when I got my last paycheck that the combined Federal and Virginia income tax withholding came out to almost 17%. Intellectually, I knew this already, and as I have had paychecks before I've seen it before, but something about that number made me sit up and notice this time. Maybe it's because I've been actively teaching mathematics now, so the number-crunching part of my brain is in constant gear.

What I suddenly realized is this: that 17% number is a sixth of my salary. So, realizing that I actually only get five sixths of the total money, for every five people like me, we're paying the various governments enough to hire the sixth person in line. Does one out of every six workers actually work for some government? I was thinking no, initially, until I started counting up government positions: legislatures, police, public school teachers, military, etc. Suddenly that number seemed a lot more plausible.

Funnily enough, the most reputable source I can find on a quick search suggests it's actually... one out of every six. Which is to say, if everyone paid my 17% tax, we may pay the people but we have insta-budget-deficits from the fact that revenue isn't high enough to support the government's infrastructure.

Of course, I'm well aware that in fact people who make a bunch more money than I do pay a lot more in taxes, and that probably covers at least some of the overrun. (On the other hand, the deficits history suggests any large government magically acquires more than offset that.) But what really concerns me here is that we're at a point as a society where for every five private citizens we've got a sixth being paid to mind everybody else's business. I'm not sure what an appropriate number would be – I'm inclined to think every twenty or fifty or something as a maximum – but the actual number seems way too high.

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