"But one big part of the reason we have so much inequality is that the top 1 percent want it that way. The most obvious example involves tax policy. Lowering tax rates on capital gains, which is how the rich receive a large portion of their income, has given the wealthiest Americans close to a free ride. Monopolies and near monopolies have always been a source of economic power—from John D. Rockefeller at the beginning of the last century to Bill Gates at the end. Lax enforcement of anti-trust laws, especially during Republican administrations, has been a godsend to the top 1 percent. Much of today’s inequality is due to manipulation of the financial system, enabled by changes in the rules that have been bought and paid for by the financial industry itself—one of its best investments ever. The government lent money to financial institutions at close to 0 percent interest and provided generous bailouts on favorable terms when all else failed. Regulators turned a blind eye to a lack of transparency and to conflicts of interest. When you look at the sheer volume of wealth controlled by the top 1 percent in this country, it’s tempting to see our growing inequality as a quintessentially American achievement—we started way behind the pack, but now we’re doing inequality on a world-class level. " ..... Of the 1%, by the 1%, for the 1% "The top 1 percent may have the best houses, educations, and lifestyles, says the author, but “their fate is bound up with how the other 99 percent live.” .....
The last line about the 99% is the key one that they either willfully ignore or are frightened to address. Ridiculous income disparities cause revolutions.
Idon't know about Revolution (with a capital R...) but certainly a lot of discontent and perhaps, losing the status as #1 rather more quickly than we should -or perhaps could avoid doing altogether- in the future) ... "Alexis de Tocqueville once described what he saw as a chief part of the peculiar genius of American society—something he called “self-interest properly understood.” The last two words were the key. Everyone possesses self-interest in a narrow sense: I want what’s good for me right now! Self-interest “properly understood” is different. It means appreciating that paying attention to everyone else’s self-interest—in other words, the common welfare—is in fact a precondition for one’s own ultimate well-being. Tocqueville was not suggesting that there was anything noble or idealistic about this outlook—in fact, he was suggesting the opposite. It was a mark of American pragmatism. Those canny Americans understood a basic fact: looking out for the other guy isn’t just good for the soul—it’s good for business."
http://mjperry.blogspot.com/2011/03/us-has-most-progressive-tax-system-for.html http://www.coyoteblog.com/coyote_blog/2011/03/deceptive-chartsmanship.html
That "the rich pay most of the taxes" argument is smoke and mirrors, and designed to distract 99 percent of the population from the fact that they're getting screwed by the other 1 percent. Fact is the top tiniest slice of the population now holds, what, three times as much of the wealth as it held during the Carter administration? Whatever they're paying in taxes, it obviously ain't enough. I watched this the other day: [ame="http://www.youtube.com/watch?v=MCNKn7JirBU"]YouTube - The One Percent 1/8[/ame] Probably not as polemical as if Michael Moore had made it, but worth a look nonetheless.
You are missing the point, and should probably read a little deeper. The point is that we have high inequality and we have higher progressivity of taxation than the developed countries with low inequality. Those countries did not get to low inequality through taxation. In fact, the second link shows that there is a trend...the higher the progressivity of taxation, the higher the inequality. You all are forgetting the real problem with progressive taxation. Taxation is a cost, but it is also empowerment. People who pay taxes are naturally more interested in how the money is spent and more influential in how policy is made. You all complain about how the rich set the agenda in this country...but by increasing their share of taxation, you are only increasing their power. Voter turnout: ~60% of voting age population. Federal funding: ~60% of the voting age population. That isn't a coincidence.
How many of those people actually pay what they're supposed to in taxes? Many of them are paying 15 percent on their earnings and hardly anything on what they inherit.
This is totally useless without seeing the actual tax rates. My gut feeling is that those are significantly lower than in big parts of the developed world...
assuming CEOs are part or close to the 1% [ame="http://www.youtube.com/watch?v=ZbZztbl-Dok"]YouTube - $$Rich get Richer, CEO's 27% raise in 2010 Oops! Rachel Maddow[/ame]
Top rate is 36 percent I believe. Should be 39 (at least), but Obama and the rest of the Democrats were too incompetent to achieve that slam dunk (or should I say empty net goal). But a lot of the 1-percenters only pay something like 15 percent on capital gains.
Actually, tax rates by themselves are totally useless. I could have a top tax rate of 100% on all earnings over $1 trillion and still have less revenues than a 30% top rate on all earnings over $1 million. Taxation as a percentage of income is what is important, and that is what this graph (roughly) reflects.
When you consider that almost all of them belong to that top 1%, you should probably come to the conclusion that it's not incompetence, but intent. The government in 2011 is truly of the top 1%, by the top 1%, and for the top 1%.
Here's what I have to say about income inequality, and everybody needs to damn well hear it because the US is the first industrialized country EVER to experience this problem: The United States of America is becoming multicultural. Not as in a blending of European cultures with some Muslims (aka Europe), or a mixture of Aboriginals and Europeans in Australia and New Zealand, but a full-blown mixture of all the peoples of the world. As societies become more heterogeneous, they lose a sense of public altruism and start to retrench along lines. Lines like skin color, class, and even regionalism. Our taxation system was created for an all-white cast, but the ensemble playing today is much less so. As the USA starts becoming more of the melting pot we were all told we ought to be in grade school, white people are going to continue to pull their wealth out of the community and behind the gates, into the "suburbs," then the "exurbs," and then who knows where. Our party system will increasingly reflect this. Party platforms based on taxation will try to benefit the ethnic groups that brought those parties to power. Eventually, it will lead to conflict. Unless, of course, we stop it. Unless Americans break the trend of being racially polarized, short-term driven individuals. And that's possible. America has overcome big obstacles before. I'm optimistic that once our country outgrows this Tea-Party fad, the next generation will have lived in a multicultural society and realized things aren't so bad. Anyway, this is my thought. Rip it to pieces!
Danny's take on this, is that if more people pay more taxes they will play a more active and vigilant role in government policy. Or something like that. I would love for him to spend a day with a Working-Poor person and see how much time he/she has in between shifts to write their congressmen on their blackbery, much less take an active role in government.
I may not agree with danny's point, but the above is a really, really awful characterization of the difference between "Working-Poor person", whatever that is and rich people who, apparently, don't work and have all the time in the world.
I know/have known plenty of people who work two shifts, six or seven days a week. Wealthier people don't generally work all day, every day, because they don't need to, and yes, that does leave them with more discretionary time on their hands. I don't see how having poor people share more of the tax burden will somehow motivate them to participate more vigilantly in the political process. They're already plenty motivated, to pay the bills on time.
The top 1% of income is over around 300K a year. Someone who makes 300K cannot afford to hire a lobbyist. Rich does not equal Koch brother. I once knew a pig who could fly, so all pigs must fly. Wait, what? You mean personal anecdotes don't translate to facts? Of the people I know (and this is true), those who are wealthy work considerably more, because those jobs aren't 9 to 5. I'm not arguing for trickle down economics here, but the notion that the poor are all working 150 hours a week while people making 250K just show up to the office to collect their paychecks shows a staggering failure to understand how the world works. Most people who have money don't inherit it and don't lie around on a couch while it trickles in. They work for it. And, quite often, they work very hard for it. Also, your notion that "wealthier people don't work as much because they don't have to" is stupid, because most wealthy people don't work for themselves. If they stop working as much, they'll get fired, because someone else WILL work that hard. You're making the argument from the crazy liberal side that dumb Republicans make - that people will work less if their taxes go up because they can. Except that's a fallacy, most of them can't. Also, the reason why rich people tend to be rich is that they keep working not because they need to, but because they want to make more money. Someone making 250K a year can't just stop working on Fridays because he doesn't need the extra 20%. The above is a massive combination of stupid. Besides which, you completely missed danny's point. Yes, I'm sure "Working-Poor persons" are motivated to work - no one has said otherwise. What they're not motivated is to deal with the government, because they have no stake in it.
On the other hand, there's a lot more overlap between the interests of someone who pulls in $300k a year and the Koch brothers than there is between a working poor person and the Koch brothers. So while you are correct that folks making $300k don't have their own lobbyists, they do benefit from the work done by lobbyists who work for people who can have their own lobbyists. And this is where you go off the rails. There's no lack of motivation to deal with the government on the part of the working poor. But where's their voice? At the ballot box? Great, a choice between two candidates of the upper 1% who serve the upper 1%.
On your first point - that's not clear. There is more overlap, but I can assure you; I get nothing out of GE not paying taxes. Most of my money that goes into lobbying doesn't do much for me. As to the second point - it's not my argument. It's danny's. He's arguing that they have less engagement with the government. I actually think that enough like-minded people can do a surprising amount. We're witnessing this now with the election of a whole bunch of tea party freshmen congressmen who really do seem to believe the crazy rhetoric that their constituents are espousing.
The people who earn 300,000 bucks definitely benefited from the lobbying that got the Bush tax cuts passed and extended.
The best chance that poor/lower/lower-middle/middle-class people have at affecting (engaging in) government is by joining a labor union - not by paying more taxes. Or they could quit their jobs and hang out near the Senate office buildings and see where that gets them. Might be more money in that if their taxes go up for trying to eek out a living.