You've confused a Roth and Traditional IRA as far as taxes go.
To correct another poster, many people can't deduct their contributions to a Traditional IRA, so there's zero tax advantage to them over a Roth during the contribution phase. Finally, while you would be happier if you could use capital losses to off-set your IRA withdrawals, what you've forgotten about the accumulation stage of your IRA is that it grew for years and years w/o paying a dime in taxes. Had you invested the same money in a non-tax deferred account, and had paid taxes on gains every year while it grew, the ending balance would be substantially smaller than that achieved by your IRA in the very same investments.
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