In the fall of 2007, when the U.S. economy first seemed in peril, I began answering reader queries here on the Business Desk. I still do so occasionally, but this page has expanded to include posts from eminent economists, "far-flung correspondents," and a variety of voices that have intriguing and/or useful things to say about economics, broadly defined. Please feel encouraged to respond to any and all of them.
Question: I recently heard that in 2011, the nation, on the whole, is paying substantially less in taxes than it did in the nineteen fifties. I do not know if this is true or just a spin.
Paul Solman: Depends what you mean. As the economy has grown, so has the absolute amount of taxes, and even the amount adjusted for inflation. So no, we're not paying less; we're paying more. But relative to a year's worth of economic output (GDP), government revenues have remained pretty constant, and with the tax cuts of the last decade, are now actually lower, as a share of GDP, than at any time since 1950.