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The week's question
In March 2025, in the thread "Re: OT, out", Umm asked the members: "Do you think it is because America is made up of magical soil that makes businesses based in America magically profitable?" This week it is put to everyone again. The button below opens the small thread re-asking it - read what others have said so far, then give your own answer as an ordinary reply.
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Halls of Shrewd'm / US Policy
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Author: marco100   😊 😞
Number: of 86256 
Subject: Re: Money maker, for sure
Date: 09/12/26 2:09 PM
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Funny, this doesn't seem to bother you too much:

AI Overview Depending on the specific economic model and year analyzed, households in the lower 50% of the income distribution receive an average of $30,000 to $45,000 annually in combined federal, state, and local transfers when "all things are considered" (including cash assistance, non-cash in-kind benefits, and health programs). [1] (marottaonmoney.com - Who pays taxes federal state local tax burden transfers), [2] (hoover.org - Myths economic inequality)Comprehensive economic reviews—such as those published by the Congressional Budget Office (CBO) and specialized studies like The Myth of American Inequality—highlight that the vast majority of non-cash government safety net distributions flow to the lower half of the population. [1] (Congressional Budget Office: Publication 62300), [2] (en.wikipedia.org - The Myth of American Inequality), [3] (qjae.mises.org - Book review the myth of american inequality how government biases policy debate)What "All Things Considered" IncludesOfficial U.S. Census Bureau income data often excludes non-cash benefits. However, when calculating total government distributions, economists factor in both cash and in-kind (non-cash) subsidies, which generally break down into four primary categories: [1] (lawliberty.org - False narratives of inequality), [2] (econlib.org: Setting the Record Straight on Income Inequality)Healthcare (The Largest Share): Medicaid, the Children's Health Insurance Program (CHIP), Low-Income Subsidies for Medicare Part D, and Affordable Care Act (ACA) cost-sharing marketplace subsidies. [1] (Congressional Budget Office: Publication 62300)Food & Nutritional Assistance: The Supplemental Nutrition Assistance Program (SNAP / Food Stamps) and school/child nutrition programs. [1] (Congressional Budget Office: Publication 62300)Housing & Utility Subsidies: Section 8 vouchers, public housing assistance, and the Low Income Home Energy Assistance Program (LIHEAP). [1] (Congressional Budget Office: Publication 62300)Refundable Tax Credits & Direct Aid: The Earned Income Tax Credit (EITC), Child Tax Credit (CTC), and state/local general assistance programs. [1] (taxfoundation.org - US income growth progressive tax code), [2] (en.wikipedia.org - Household income in the United States)Average Distributions Across the Bottom 50%Because data is typically tracked by "quintiles" (20% increments) rather than an exact 50% split, the lower half of the income distribution is best understood by looking at the lowest quintile (0–20%) and the second quintile (21–40%), which receive more than two-thirds of all means-tested transfers. [1] (qjae.mises.org - Book review the myth of american inequality how government biases policy debate)Income GroupAverage Annual Government Transfers Received (All Levels)Key Characteristics & CompositionLowest Quintile (Bottom 20%)$34,092 to $45,389Heavily dominated by Medicaid and Medicare benefits, followed closely by SNAP and housing aid. Government transfers match or exceed their earned market income.Second Quintile (21%–40%)$25,000 to $30,000Receives a balanced mix of healthcare benefits, refundable tax credits (like the EITC), and childcare assistance.Middle Quintile (41%–60%)$22,510Primarily receives social insurance benefits (like regular unemployment or Social Security) rather than low-income means-tested aid.The "Net" Effect (Taxes vs. Benefits)When comparing what the lower 50% receives against what they pay, the bottom half of American households are net recipients of government spending. [1] (aei.org - Cbo study shows that the rich dont just pay a fair share of federal taxes they pay almost everybodys share)According to data compiled by the Tax Foundation, families in the lowest income tier receive roughly $5.28 in total government spending for every $1 they pay in federal, state, and local taxes. [1] (taxfoundation.org - Distribution tax and spending policies united states)In contrast, the middle 20% roughly breaks even, receiving about $1.48 per tax dollar. [1] (taxfoundation.org - Distribution tax and spending policies united states)If you are looking for specific data, please let me know if you want to focus on a specific state's distributions, a particular program (like Medicaid vs. SNAP), or a certain year's dataset.Congressional Budget Office (.gov)The Distribution of Household Income in 2021Sep 11, 2024 — Means-Tested Transfer Rates Remained at the Historically High Levels They Reached in 2020. Among households in the lowest quintile...Congressional Budget Office (.gov)The Distribution of Household Income, 2022Jan 21, 2026 — Most means-tested transfers go to households in the bottom two quintiles of the income distribution. In this analysis, CBO divided...Quarterly Journal of Austrian EconomicsThe Myth of American Inequality: How Government Biases ...In 2017, federal, state, and local governments redistributed $2.8 trillion, 22 percent of the nation's earned household income, an...Show all
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This community has written 86,214 posts about US Policy. The article-length ones it recommended most:
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