The facts eventually arrive to drive back the drivel.

From The IRS Proves the Left’s Favorite Economists Wrong by Phillip W. Magness and Stephen C. Miller. The left always returns to income inequality as one of their go-to accusations. Indisputably there is income inequality.

Indisputably there is some portion of income inequality which arises from rent-seeking by special interests. The Left wishes to treat this by centralizing economic decision-making into the government. The right sees that most the rent=-seeking occurs precisely because of government policy and intervention. For the right, the best mediating policy is better enforcement of rule-of-law, better enforcement of contract, and more competition. The right generally isn't too fussed by income inequality as long as the income is fairly (i.e. no rent-seeking) acquired. If the degree of income inequality reasonably matches the degree of difference in productivity, they are pretty comfortable.

The fact is that most of income inequality does arise from productivity differentials. But the trope that women are paid less than men for the same work and idea that the rich pay less than their fair share in taxes is the cockroach of mental memes. It is hard to eradicate. Facts alone won't do it and periodically there will be some release of some academic paper which tries to breathe new life into a doddering old ideologic conviction.

‘The Rich Really Do Pay Lower Taxes Than You” read a headline in the New York Times last fall. This astounding claim, presented in the media as fact and evidence of inequities baked into President Trump’s 2017 tax cut, came from two economists at the University of California, Berkeley. Emmanuel Saez and Gabriel Zucman asserted that 2018 was the first year in U.S. history that the average tax rate on the 400 wealthiest income earners dipped below the rates paid by the lower-middle class and poor.

Income inequality is usually a vote loser so left-leaning journalists tend to steer clear unless they can get clear academic air-cover. They'll even seize academically suspect research if it it bolsters the cause. I did not pay much attention to this new "research" assuming that, given time, it would be refuted by facts.

The Saez-Zucman analysis raised eyebrows among other economists who study tax data, in part because they claimed it reflected the first full year under the new tax rates. At the time they published their study, the IRS had yet to release the data necessary to make the calculations they described. Preliminary numbers for 2018 income-tax returns, covering all filings made by last year’s Oct. 15 extended deadline, came out only last week. These data tell a very different story: America’s wealthiest earners still carry the lion’s share of the tax burden.

Closer inspection reveals that Messrs. Saez and Zucman imputed the tax rates they claim for 2018 from records that predated the Trump tax cut, and therefore didn’t capture its effect on the measured distribution of income. They built in opaque assumptions that now appear to have exaggerated the tax cut’s benefit to high-income earners.

This wasn’t the only problem with the Saez-Zucman statistics. Their alleged 23% tax rate paid by the highest earners—encompassing all federal, state and local taxes—fell below the Congressional Budget Office’s estimates for the top income percentile’s federal tax rate alone. The two economists’ tax rates for the poor also looked suspiciously high. A 25% rate for the lowest quintile of earners would be almost twice the level found in other estimates, including those using better-established data from the Congressional Budget Office and the nonpartisan Institute on Taxation and Economic Policy. The discrepancy arose from Messrs. Saez and Zucman’s exclusion of the earned-income tax credit for low-income households, artificially inflating the amount of tax the poor really pay.

And now the facts have arrived and the Saez and Zucman hypothesis is brought to heel.

The new IRS numbers now provide reason to doubt Messrs. Saez and Zucman’s entire narrative of a regressive U.S. tax system designed to favor the rich at the expense of the poor. The IRS reports effective income-tax rates on the adjusted gross incomes of different groups of earners. That’s the percentage of income that people actually pay to the government, as distinct from the statutory tax rate.

According to the IRS, the top 0.01% of earners—those with incomes above $10 million—paid a 24.8% effective federal income-tax rate in 2018. This isn’t very different from the 25.3% the group paid in 2017, and is higher than the average rate of 22.5% on the same group during the George W. Bush administration. As these rates only encompass federal income taxes, most filers can expect to add another 8% to 12% of income from other forms of taxation, placing their total burden well above the Saez-Zucman numbers.

How does that affect the claims of regressivity? It’s true the remainder of the top 1% (those with incomes between roughly $500,000 and $10 million) paid a slightly higher effective rate, at 26.5%, than the top 0.01% did. But tax rates drop rapidly from there, with filers in the $50,000 to $75,000 reporting bracket (approximately the median U.S. family income) facing an average federal income-tax rate of 8.4%.

People who earned between $15,000 and $40,000 paid an average federal rate of merely 4% of their adjusted gross incomes in 2018. And thanks to the earned-income tax credit and others like it, the poorest earners paid very little if any federal income tax at all.

In short, the federal income-tax structure still places the unambiguous bulk of its burden on the highest earners. The Trump tax cut hasn’t changed that. In 2018, the top 1% of U.S. earners paid roughly 37% of all federal income taxes. The top 5% paid around 58%. This suggests that policy makers wishing to mitigate regressive features of the tax system should look elsewhere. State and local sales and property taxes may be a more promising area for reform.