It’s a galling statistic for those of us struggling to finish up our tax returns and stressing over what further money we’ll owe to the federal government: 47% of American households will pay no federal incomes taxes at all for 2009. Either their incomes were too low, or they qualified for enough credits, deductions and exemptions to eliminate their liability. Meanwhile Fed Chairman Ben Bernanke was in Dallas yesterday talking about the coming collision between the national debt and the taxing and spending habits of the American government and public. Bernanke message was clear: the debt is quickly becoming unsustainable, and Americans will soon have to choose between raising taxes or dramatically cutting public spending. Which course do you choose?
Roberton Williams, senior fellow in the Tax Policy Center at the Urban Institute