The Tired Donkey is interested in language, and he must wrestle with it often in his day-job. He is forced to spend a few days every so often in Washington talking to Myrmidon Donkeys and—as is more often the case—their just-out-of-college aides. In this environment, the side that seizes the linguistic high ground is usually the side that wins the day, so the Tired Donkey spends a lot of time considering what to call things. Unfortunately for all of us, the Freeloaders—working through their Myrmidons Donkeys on Capitol Hill—carried the day on tax language decades ago, but that does not mean we should not be sensitive to its ever-present distortions. The Tired Donkey will now dispense some wisdom on this subject.
In an article earlier this week in the New York Times, Jackie Calmes and Carl Hulse discuss Democratic opposition to various provisions of the Obama budget proposal. They highlight the opposition of creepy-looking Senator Max Baucus (D-MT) and Representative Charlie Rangel (D-NY) to the president’s proposal to limit tax deductions for the wealthiest 1.2% of donkeys; Myrmidon Donkeys Baucus and Rangel cite a potential drop in charitable giving as their reason. The Tired Donkey is skeptical about this “reason” and finds it more likely that these Myrmidon Donkeys enjoy the patronage of some rich Steadfast Donkeys who don’t want to pay more taxes, but he will have to explore this suspicion in more detail on a later date since his purpose today is to discuss the language of taxation.
Reading on, the Tired Donkey came across this curious sentence regarding the strange Myrmidon Donkey opposition to more taxes on rich donkeys:
The next day, however, Mr. Geithner* staunchly defended the proposed limit, telling the House Budget Committee it would affect few taxpayers and still let them take deductions at the same level as in the Reagan years: a 28 percent rate, nearly twice what most taxpayers can claim.
What, you may ask, is wrong with this sentence? The Tired Donkey will tell you. It implies that under the proposal, rich donkeys will be getting a real bargain. “Good heavens! Deductions at twice the rate most taxpayers can claim. What a deal!” Wrong. The Tired Donkey is tempted to use a prison sex metaphor here, but he will refrain because he is aware that he has some younger readers. Instead, he will give it to you straight, just like the tax code does: in 2006—the latest data the Tired Donkey can find (here)—the rich donkeys Myrmidon Donkey Geithner is referring to paid 39.89% of all income taxes collected by the federal government. Yes, you read that right: 39.89%. The highest marginal tax rate is what applies to the vast majority of these payments, and that rate was 35% in 2006. Myrmidon Donkey Geithner may consider it a deal to pay taxes at a 35% rate and only get deductions at a 28% rate, but the Tired Donkey has a different term for it. He calls it getting the shaft.
*Tired Donkey Note: Mr. Geithner is Secretary of the Treasury and a tax cheat of some renown; he may very well be the Queen of the Myrmidon Donkeys.