This is the Cato Daily Podcast for Monday, November 5th, 2007. I'm Caleb Brown.

Several presidential candidates are pushing hard to soak the top 1% of income earners in the United States.

Cato Institute Senior Fellow Alan Reynolds says that could have some unwelcome implications for workers who are not in the top 1%.

The emphasis on the share of income going to the top 1% serves a purpose. It's a means to an end,

and the end is to increase tax rates, not just on the top 1% but just about everybody.

So you start out by trying to feign outrage that, oh my gosh, the top 1% are getting more and

more of our income, actually they're getting their own income.

But that's the way it's phrased.

And then you try to slip through a repeal of all the 2003 tax cuts, which includes the lowest rates, not just the highest rates.

Sur taxes to get rid of the AMT, sur taxes for medical insurance, sur taxes for this and that,

sur taxes piled on top of sur taxes, all of which are certainly not just paid by the top 1%.

But the number is there to serve a polemical political purpose because there's a

presidential election coming up next year. It's not the top 1% of all

income it's the top 1% of all income. It's the top 1% of something called adjusted gross income that shows

up on individual tax returns. That's a pretty big distinction. Obviously not all income

shows up on tax returns.

It'd be a little naive to think it does.

There is tax avoidance.

There is an underground economy.

But more than that, these numbers typically

exclude almost all transfer payments. That is they only include a portion of

Social Security, if any, they don't include in-kind transfer payments like Medicaid

...