The socialistic-minded are forever reminding us that something like nine-tenths of the wealth of the nation is controlled by one-tenth of the people. In refutation of such a charge, Mr. Otto Kahn recently stated that of the total income to the nation 88 per cent goes to those with incomes of less than $5,000 and barely 12 per cent of those with incomes above that level. The tax returns of 1918 which have just been analyzed show the relative percentages of these two classes to be 89.17 and 10.83 respectively.
The New York Times reminds us in this connection that the same tax report shows that people with incomes of $5,000 or less received 41 per cent. Thus, though only 10.83 per cent of those reporting had incomes of over $5,000, their total incomes were roughly two-fifths of the total of net incomes reported. In other words, slightly more than one-tenth of those reporting received two-fifths of the income reported. But this figure is subject to a considerable discount. The total of net incomes reported is something less than the normal income on resources of the United States. It is well known that many, especially those with smaller incomes, not only escape payment of the income tax, but fail to make any report. In the total of the nation’s wealth, more over, are to be reckoned multitudes whose income falls below the minimum for taxation. Out of a population of above 100,000,000, only 4,425,114 paid an income tax, or about one in 22. It is thus obvious that those who receive 2/5ths of the total of incomes reported receive for less than 2/5th of that total incomes of all Americans.
From the editorial page of The Charlotte News, Sept. 6, 1921
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