Freakonomics Radio Ten Myths About the U.S. Tax System (Update)
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Apr 8, 2026 
Jessica Riedl, a budget and tax policy expert and longtime deficit watchdog, cuts through Washington spin. She tours the biggest tax myths. She gets into why both parties love free-lunch promises. She highlights the fight over taxing the rich, the real drivers of long-term debt, exploding interest costs, and why fiscal honesty is so rare.
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The Biggest Tax Myths Distort Both Left And Right
- Jessica Riedl argues the U.S. tax debate rests on myths, especially that tax cuts self-finance and that the middle class is taxed harder than the rich.
- She says Europe funds bigger government mainly with VATs and payroll taxes on ordinary earners, not by soaking only the rich.
The Buffett Tax Story Misses How Rates Are Counted
- Wealthy investors can defer capital-gains taxes, but Jessica Riedl says top earners still pay higher effective federal tax rates than lower earners.
- She calls the Biden White House 8 percent claim misleading because it counted unrealized wealth as income while omitting estate and corporate taxes.
The Deficit Problem Is Mostly Spending Not Taxes
- Jessica Riedl says tax policy explains only about one-third of rising deficits since 2000, while spending explains roughly two-thirds.
- Federal revenue stays near 17 percent of GDP, but projected spending climbs toward 33 percent over 30 years.