If there's one thing that liberals have been beaten about the head and ears with in election after election, it's that we're the philosophy of high taxes. As with all good insults, there's a grain of truth there--but not as much as is commonly assumed.
First of all, there's a key quesion which isn't commonly addressed--"as opposed to what?" That is, if you aren't in favor of raising taxes in the current situation, what are you in favor of? The usual conservative response is "cutting the size of government," but we haven't seen any sign of the current government doing that, despite nominal conservatives controlling both houses of Congress and the presidency. If you're in favor of increasing the deficit instead (which is what's happened so far under the tax cuts favored by Mr. Bush), how do you forsee returning the budget to balance? Or do you forsee doing so? (The current plan for "cutting the defict in half" requires that Congress not make the most recent tax cuts permanent. Since that doesn't seem to be what the President intends, what is the alternate plan?)
The federal government is principally financed through two taxes: the federal income tax, which is progressive (that is, tax rates increase with income), and a Social Security Tax (also called the "self-employment tax" when freelancers pay it) which is flat (it's the same rate no matter your income).
The progressive nature of the federal income tax is frequently misunderstood. Income is taxed at different rates depending how much income a person makes--the first seven thousand dollars that a single person made in 2003 was taxed at 10%, the next $21,400 at 15%, then 25% up to $68,800, 28% up to $143,500, and so forth. The problem is that people tend to speak as though they were in the tax brackets--so a person getting a raise from $68,000 to $69,000 often will say, "I'm in the 28% bracket now," as though they previously paid 25% on their entire income (that is, 25% of $68,000) and now pay 28% of $69,000.
That's not how the tax code works. At $68,000 of taxable income, you pay 10% of $7,000 ($700), 15% of $21,400 ($3,210), and 25% of $39,600 ($9,900), for a total tax bill of $13,810 (I'm neglecting exemptions and deductions here, for simplicity). This would be an overall tax rate of 20.3% (again, neglecting deductions and exemptions). At $69,000, you pay an extra $800 at 25% ($200) and an extra $200 at 28% ($56), for a total tax bill of $14,066, and an overall tax rate of 20.4%.
Conservatives frequently attack the progressive tax structure as "unfair," becuase it taxes higher-income people at a higher rate than lower-income people. Liberals (this author included) tend to favor progressive taxation, on the theory that it correctly reflects how much a person can afford to pay taxes. The first portion of anyone's income--rich or poor--can be thought of as going to essentials--food, clothing, and shelter. The difference between $17,000 and $18,000 in income is how many meals a family can afford to eat. The difference between $68,000 and $69,000 is a certain amount of comfort. The difference between $300,000 and $301,000 is nearly irrelevant.
Are there problems with progressive taxation? Yes--there are three. First, if a person holds a lot of different jobs, witholding the correct amount of money from a paycheck becomes tricky; unless one is organized it's easy to withold too little. Secondly, it tends to lead some people to treat the wealthy as an endless conucopia of tax money. This can lead to a lack of concern for what government programs cost, which in turn leads to bad policy. Finally, it tends to lead to a complex system of taxation, which gives rise to a lot of "gamesmanship" by people and corporations.