Memes and accuracy

This meme has been around for a couple of years now.  It's as inaccurate now as it was when created.  I pointed this out once again on FB and was asked by one of the friends of the friend who shared it what makes it so inaccurate and to provide sources.  Sounded like a challenge.

Let's start with the numbers above.  According to Siri, that's $4,597.98.  Just to be sure, I checked her math in an Excel spreadsheet.  Siri got it right.  Now the first source cited at the bottom of this meme claims that the average American pays $6,000 in corporate subsidies.  Their math seemed wrong since they counted one factor of $870 twice.  So why should we rely on a source for the creation of this meme that begins with a false premise.  Also, if we're calculating a family's "share" of government expenditures based on their income, the methodology should be different.

What makes this corporate subsidy amount even more inaccurate is that more than 10% of this amount is made up of business incentives granted at the state, county and local level, which has no correlation to a family's federal tax burden.

This source took their "total" corporate subsidy amount and divided it by the total number of taxpaying "families" (which includes those taxpayers who have no spouse/dependents).  This means that a family earning $500,000 is paying the same amount of corporate subsidies.  Therefore, their share of this burden isn't based on their income of $50,000.  It's an apples and oranges comparison.

The second source is a calculator found on the White House website.  The values it shows when you input an estimated 2011 income of $50,000 for a married couple with one child are the source for some of the values in this meme.  And it proves how they are wrong.  The $235.81 shown for "Medicare" actually includes the $43.87 shown for "retirement and disability for civilian to government workers." 

Then there's the fact that this calculator doesn't show any spending on payments to those receiving Social Security benefits that aren't SSI or SSDI.  That means that these calculations, which do include the FICA tax paid by employees and the self-employed, which were $2,100 on the White House calculator, don't include nearly $600 billion in spending in 2012 to those receiving Social Security retirement benefits.

Then there's the fact that there are "subsidies" given to individuals that aren't accounted for at all in this meme.  Some are.  The Earned Income Tax Credit was included in the White House calculations.  Then again, so is the Making Work Pay tax credit, which actually expired in 2010.  None of the following individual tax "subsidies" are included in the White House calculations:

Self-employed health insurance deduction
Hope Credit
Lifetime Learning Credit
Tuition and Fees Deduction
Educator Expense Credit
IRA and SEP-IRA Deductions
Student Loan Interest Deduction

If we're going to assess an amount for corporate subsidies (even a totally inaccurate one), we have to include one for individual subsidies as well.  But the entire concept of imputing an amount for subsidies is a bit specious since it mostly refers to imputed tax revenues foregone by the government.  Very little of that amount involves actual expenditures.

The bulk of this material actually comes from the two sources cited in the meme.  The rest is available at www.irs.gov and through the Statistical Abstract of the United States, published annually by the federal government.