The puppet on the left is George. He looks friendly, doesn’t he? Well, he’s not. If you close his mouth, you can see him for the grim misanthrope that he is. But angry though he may be, we still love George for all the joy that he, as a puppet, provides for all the world, even if he would prefer it otherwise. And now for the news.
Remember Joe the Plumber? We all know that he was a liar, but even taken at his word, he would have paid almost no more in taxes. If you raise the top tax bracket from 35% to 39.6%, this will only effect the taxes on the money you make over a quarter million dollars. So if you make $250,001, you will owe 5 cents more, not $11,500! This is what we call a marginal tax.
This morning, Jonathan Chait wrote about how no one seems to understand marginal tax rates:
All I can say is that if Geithner really did break out the hand puppets, I’d like him a lot more. And God knows that George would have a few well chosen words for those guys.
Robert Reich has an excellent article on this subject. Sorry: no puppets.