As we draw closer to the November elections, there is an inordinate amount of attention being paid to “disinformation,” and a great deal of fact-checking of candidates’ statements.

Yet here are four surprising facts: (1) the subject on which there is the most disinformation is “taxes”; (2) almost all the disinformation comes from the left; (3) it is spread to the general public by the mainstream media; and (4) it is almost never fact-checked.

Let’s take a closer look.

Who benefits from income tax cuts?

Consider these two statements

Most of the benefits of the 2017 (Trump) tax cuts went to the rich.

The tax code today is just as progressive (if not more so) than it was before the tax cuts went into effect.

Surprisingly, both these statements are true. The first statement is true but misleading. The second statement is simply true.

What is rarely said in policy debates is that for the most part, half the population isn’t paying income taxes at all. Specifically, the top one-half of taxpayers are paying 97.9% of all income taxes, while the bottom half pays a paltry 2.3%. So, it’s hard to think of a tax cut that wouldn’t confer most of the benefits on the top half of the income distribution.

Progressivity is a different matter. Suppose we cut everyone’s taxes by 1%. For a millionaire, that would be $10,000. For a $30,000-a-year worker, that would be $300. That’s a big difference in raw numbers. But from an equality standpoint, everyone’s share of the country’s after-tax income would be the same both before and after the tax cut.

That’s a good way to think about the 2017 tax reform.

Do the rich pay their fair share?

When Joe Biden says “the rich aren’t paying their fair share,” what is he talking about?

If we define the rich broadly (to refer to the upper half), their share is already approaching 100% and that is as high as it can go. But even if we are talking about the really rich, their share is quite high.

The top 1% (people who earned more than $682,577 in 2021) paid 45% of all income taxes collected that year. The top 10% (earning more than $169,800) paid three-fourths of all income taxes.

This reflects the fact that the United States has the most progressive tax system in the world. We tax the rich proportionally more than any other country.

Why is our income tax system so progressive?

Although they don’t like to talk about it, Republicans are the main reason. Going all the way back to Ronald Reagan, every Republican tax bill threw more and more people off the income tax rolls. Through this and other provisions, Republicans have been shifting the tax burden to the rich every time they have legislated on taxes.

Both private and government analyses confirm that the same is true of the 2017 tax reform law. In 2018, the top 20 percent of the income distribution faced a lower tax rate, but they paid a larger share of the total tax burden than the year before.

Had Democratic opponents had their way, the share of the tax burden would actually be lower for the rich and higher for low- and moderate-income families than it is today.

What about corporate taxes?

Although corporations send checks to the U.S. Treasury, economists do not regard corporate entities as bearing the real burden of taxation. That burden is borne by people in their role as shareholders, workers, customers, etc.

The Tax Policy Center (TPC) estimates that 20% of the corporate income tax is paid by labor in the form of lower wages and 80% is paid by capital (lower dividends and interest payments, for example). For certain types of tax changes, the TPC assumes a 50/50 split. The Congressional Budget Office (CBO) assumes that 25% is paid by labor, and it is the official score keeper for Congress.

When Joe Biden and Kamala Harris say that raising the corporate income tax rate from 21 percent to 28 percent will not result in a tax on anyone earning less than $400,000, almost no economist will agree with that assertion. If members of Congress vote for the measure, they will be instructed by the CBO that they are voting to take one out of every four dollars of increased government revenue out of the pockets of ordinary American workers.

Also, remember that workers are also shareholders through their pension plans, 401(k) plans and IRA accounts. So, to the extent that corporate taxes fall on capital, workers bear part of that burden as well.

The most sophisticated model of international capital flows and corporate taxes ever developed has been produced by Boston University economist Laurence Kotlikoff and his colleagues. Their finding: the burden of corporate taxation is almost entirely shifted to labor. If Kotlikoff and his colleagues are right, then almost all of the Biden/Harris proposed increase in corporate taxes will come out of the pockets of people who make less than $400,000 a year.

Taxing capital gains

Last time I checked, the stock price of Microsoft was $416. That’s what investors have to pay for the right to share in the company’s earnings indefinitely into the future, as long as they hold the stock. The word “future” is key. If a sell my share after a rise in price, I will have a capital gain. But that gain does not reflect any increase in income to Microsoft. It merely reflects a change in the market’s expectations.

Eventually the future will arrive, Microsoft will experience real earnings, and investors will pay taxes on those earnings. That’s why we don’t need a capital gains tax on the trading of Microsoft stock. Eventually, all of Microsoft earnings will be taxed by regular income taxes.

It is noteworthy that capital gains are not included in the calculation of GDP. They are nowhere to be found in our national income accounts. Ditto for capital losses.

If there were a logical reason to tax capital gains, there would be an equally compelling reason to allow the full deduction of capital losses. But were that allowed, the government would probably get no net income in the process. By way of analogy, the only reason the government collects any money by taxing the winnings of gamblers is because it doesn’t allow them a full deduction for their losses.

Taxing unrealized capital gains is even harder to justify. It would be like taxing the gambler—not at the end an evening of gaming, but after each time a roll of the dice produces a win, while ignoring each time there is a loss.

What is wrong with taxing investment to pay for consumption?

Take the progressive $5 trillion plan for cradle-to-the-grave benefits, including child care, elder care and everything in between. Like the idea of taxing unrealized capital gains, almost all progressive ideas for new revenue involve confiscating funds that are now in the capital market and using those funds to pay for current consumption.

But less investment means slower economic growth. And that means our children and grandchildren will have a lower standard of living. And since economic growth is the greatest anti-poverty program ever discovered, slower growth means more people will continue to live in poverty for a longer period of time.

That’s why many economists—on the right and the left—advocate a progressive consumption tax, with no tax on saving and investment. That would be a fairer tax. It would tax the rich for what they take out of the economy by consuming, but not tax them on what they contribute to the economy by saving and investing.