The ever shrinking middle class pays for everything. The poor are too poor and the rich have the resources to figure out how to avoid paying.

This common sentiment isn't really true in general, but led to a great deal of amusement for me in a previous life in wealth management.

We constantly got clients who were newly rich and believed there were all sorts of tricks and loopholes that would allow them to avoid paying taxes. They'd come to us with ideas about trusts, shell companies, charitable organizations, loans, whatever, and inevitably leave frustrated and disappointed when they learned the really was no way to use their new wealth without the government first taking half.

This is a misconception. Everything is paid for by inflation. This hits the poorest the hardest.

I would say it’s because we burden the middle class — causing a bimodal distribution (wealthy and poor) without any means of upwards mobility because small businesses are regulated and taxed beyond what they can sustain.

No, we steal from the poor via stuff like an onerous legal system, fines, fees, and most importantly, inflation.