Conventional wisdom on government's role in inequality often has it backwards. Tax reforms have resulted in a more progressive federal income tax government transfer payments have become less progressive.

Summary

This quote suggests that the commonly held belief regarding the government's role in inequality is incorrect. It argues that while tax reforms have made the federal income tax more progressive, meaning that wealthier individuals pay a larger proportion, the government transfer payments have become less progressive. In other words, while the rich may be paying more taxes, the redistribution of wealth through government programs has become less equitable, potentially exacerbating inequality. The quote challenges the conventional thinking that tax reforms alone can effectively address inequality.

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