I HAVE AN ABIDING CONCERN that the average American is completely unaware of the “opportunity cost” of the exploitive misapplication of the income tax to earnings which don’t actually qualify that has been widespread since the 1940s. (If this subject is new to you, see http://losthorizons.com/comment/archives/BobsBicycles.pdf to get a quick handle on the scam and http://losthorizons.com/BulletinBoard.htm to quickly see the truth of that little story. Or, see http://losthorizons.com/The16th.htm for a much more in-depth presentation.)
Laid out for viewing, that opportunity cost is startling and appalling, to say the least. Let’s have a look (working with available 2015 figures).
ACCORDING TO THE U.S. CENSUS BUREAU, median individual earnings in 2015 for all workers over 15 totaled $30,240. We’ll use that low-weighted figure so as to be conservative (the higher the earnings with which we begin, the more dramatic are all the lost opportunities we’re going to examine).
Treating that $30,240 as subject to the income tax and applying the 2015 $6,300 “standard deduction” for a single filer and a $4,000 single personal exemption, we end up with a “taxable income” for 2015 of $19,700. (Some folks would apply a few additional specialized deductions, which would reduce this figure somewhat in those cases. But since ...
