Visualizing the Long Tail for Tax Policy: Part 2

Above is a corresponding visualization of the Obama plan - but it's a little more complicated. Again, you can click to zoom in.

Obama's plan includes both tax cuts and tax increases. All of Obama's tax cuts go to the bottom 900 people (the poorest 90%). The total cuts for the bottom 90% is much larger than for McCain's plan, but it's also distributed quite differently, as the inset shows.

For the next 90 people (percentiles 90-99%) it's basically a wash - the bottom half of these will get a tax cut, but a very slight one, and the top half of those 90 will see an increase: in terms of field position, they'll take a penalty, and have to move back to the left. How far, you ask? On average across these 90 people, the penalty is about 6 inches each - not enough to see on the gridiron I drew.

For the next 9 people, in the 99-99.9% bracket, the average tax increase is big enough to be visible: about a 4 yards penalty. An offsides penalty, maybe. I drew the approximate shift of each of these 9 people on the graph, with dotted blue arrows pointing from the old to the new position.

For the last guy, the penalty is nearly 22 yards, moving him back to the 70 or 75. Maybe a holding call.

I didn't bother to draw the appropriate-size stack of bills for the tax increases- you'll just have to image it. I didn't draw field-position arrows for the McCain tax plan because nobody moves by more than a foot or so - except for the guy down by the 94-yard line, who just about makes it to the goal.

I should also probably point out (in case it's not obvious) that neither of these plans is likely to be implemented exactly in their proposed form - even if the economy and stock market hadn't implored the last couple of weeks, which has obviously changed things, there's a long process of digestion before any major legislation is produced by congress, and like digestion, what comes out is often quite dissimilar from what goes in. It's probably best to think of this as a statement of what values the candidates stand support, rather than a prediction of how your taxes will change.

So to summarize:

• The Obama plan makes the spread between the highest-paid and lowest-paid Americans noticibly smaller. The McCain plan makes it slightly larger.
• The bottom 50-60% of the country by income do much better under the Obama plan).
• The tax plans are not very different for the 60-95% bracket, between about $70k and $170k per year.
• The 95-99% bracket ($170-$240k) clearly does better under McCain - by a substantial amount in dollars each, but a small percentage (a little more than 2%, actually) in income.
• The top 1%, and especially the top 0.1%, do much much better under McCain.

Go Steelers!