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What Ails America? Giving 20% of Our Money to the Rich
Many people object to any 'redistribution' of income through taxes, because that, in their view, is socialist. It penalizes hard work and success, and it stifles the spirit of innovation.
But a great redistribution of wealth has already occurred, in the other direction. From 1980 to 2006 the richest 1% of America nearly tripled their after-tax percentage of our nation's income, while the bottom 90% has seen their share drop over 20%.
That's TRIPLED, AFTER-TAX.
Either one and a half million rich people started working 3 times harder or we've experienced a redistribution of wealth not seen since the Great Depression.
Here's another way to look at it. Since 1980 our country's productivity has steadily risen, with total income doubling approximately every 10 years. If the bottom 90% of America had shared in this prosperity at a level consistent with 1980 incomes, they would be making $45,000 a year instead of $35,000.
Yet remarkably, local initiatives to balance the budget generally target middle-income earners. Regressive state income taxes, the sales tax, new property taxes, gas taxes, cigarette taxes, utility costs, license fees, parking meter rates. If this isn't enough, there might be a cutback on after-school programs in low-income areas, or a cutback on park services, even if it means some of the parks won't open as a result.
We rarely hear serious proposals to return income tax rates to the levels that helped to build a strong middle class a half-century ago. Instead we hear arguments based on emotion rather than facts. Like the rich paying almost all the taxes. It's true that the top 1% pays 40% of all federal income taxes. But federal taxes are a small part of the tax burden on lower- and middle-income people. Based on recent data from the Institute on Taxation and Economic Policy, the total of all state and local taxes, social security taxes, and excise taxes (gasoline, alcohol, tobacco) consumes 21% of the annual incomes of the poorest half of America. For the richest 1% of Americans, the same taxes consume 7% of their incomes.
Internal Revenue Service figures show that almost half of our country's income goes to the richest 10% of Americans (those making at least $283,000 a year). The distribution of wealth is even more skewed, with the richest 1% of Americans owning more than the poorest 90%.
Innovative, industrious business leaders certainly deserve to be well-compensated for their efforts. But even Adam Smith, the father of capitalism, realized that the wealthy benefit most from a strong economy, which we've had for most of the past 25 years. He recognized that reasonable limits must be in place to curb abuses. A progressive income tax is the best way to do this, no matter how much yelling we hear from the top.
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22 Comments so far
Show AllI have listed these sites before but I will again because they are relevant. According to the Economic Policy Institute:
http://www.epi.org/
in 2004, the richest 1% of people in the country had 34.3% of the wealth. The next 9% had 36.9%. The next 10% have 13.4%. The poorest 80% had 15.3%. That means that the richest 20% of people have nearly 85% of the wealth while the poorest 80% (most of us) had little more than 15%.
To see most of these numbers in pie chart form along with other numbers on income, taxes, etc., go to:
http://www.inequality.org/
and click on "By the Numbers".
As if that weren't enough, the Bush tax cuts benefitted the wealthiest. See:
http://www.commondreams.org/cgi-bin/print.cgi?file=/headlines06/0405-12.htm
This allowed more wealth to "trickle up".
The Economic Policy Institute site has later numbers but it's a bit hard to get through. They also have a series of books "The State of Working America" for different years. Excerpts can be found at the site.
So what is wrong with the richest 1% of people paying 40% of taxes? They have over 1/3 of the entire wealth of the country. I wonder how much of that money is sitting in UBS tax haven accounts.
The 1982 dip in savings rate is interesting. Prior to that it had climbed from some 5 percent in the 1940s to a peak of nearly 12 percent in 1982. This meant Americans had enough income to allow for savings.
from 1982 (Reagan revolution) it plummetted to negative territory.
This trend also follows the US as a Creditor nation into a debtor one.
The Reagan revolution bankrupted America.
Yet he seen as some sort of Saint.
The argument is made that America is not "Third World". This is not due to the sound policy of The US Government or the greatness of Capitalism.
It is due entirely to the US dollar being the reserve currency which allows the USA to print and borrow money at will.
It like a Credit card with no limit.
Were people in the Sudan all given Credit Cards with no limits, they too would be able to buy new homes and cars and computers and were its Government able to borrow at will by printing money with no limits, they too could build highways and railways and ports and spent 10 trillion on their military.
Don't forget US corporate taxation statistics which are stacked even higher against the working class.
In 1970 corporations paid 29% of US income taxes. Today they pay 6%. Within 10 years they will pay nothing.
Every dollar of tax revenue the government doesn't get from a corporation is an additional dollar they need to get from YOU !
While, neocons, fascists and others argue that corporations pass their tax burden on to customers in the form of higher prices, the reality is that you have no choice, you must pay higher taxes, thereby subsidizing corporations even if you never buy anything from the corporations. If, instead of paying higher taxes, you paid higher prices for goods and services you purchased from corporations, you would only paying for what YOU chose to purchase.
One must also consider that the vast majority of the 1% or even the 10% earned their wealth by carefully selecting their parents.
Every man deserves and should reap the rewards of his efforts, regardless of how large; but no man should be able to pass that on to generation after generation.
We have an aristocracy!
They hate us because of our freedom! Right, and I have this bridge....
So you don't think that people should have the right to use the wealth they earned to give their children material comforts, safety, and security? Is fairness your sole justification for this view?
I agree that being born into money offers tremendous advantages and that, on the average, the rich get richer and the poor get poorer. However, I cannot bring myself to believe that it is just to prevent an individual from giving his money to whomever he chooses after death.
Ah, but what better measure do we have for the "benefit derived from society" than wealth. As such, since they benefit the greatest from our current form of society, they should pay the most for it.
Not saying they cannot give what they have left to their kids, but they should support that which made them wealthy
"Ah, but what better measure do we have for the "benefit derived from society" than wealth."
One could state it differently as "What better measure do we have for society's benefit from that individual than his/her wealth".
"As such, since they benefit the greatest from our current form of society, they should pay the most for it."
So the argument is: Since you have the most wealth, we are safe to assume that you benefited the most from state funded programs. We therefore feel justified in forcing more money from you to pay for the state's current expenses.
If a group of ten people go mine for gold and one person strikes it rich, can we say that he owes more to the others(no pre-existing agreement) since his wealth now suggests that he benefited more than the others from "society".
I am just playing devil's advocate seeing as it sounds like you agree with me about inheritance in the end anyway.
What good is being king, if you can't make your son king when you die?
What good is gathering more firewood than one needs for the day if the excess is distributed in a manner to be decided by popular vote (rather than to the people of your choice)?
I am not doing this to be a nuisance, I doing this because ACTION by us is the ONLY thing that will save us now.
Nationwide Gnr'l Stryke-Sick Out: Card Check; Single Payer; Out of Iraq/Afghanistan - right from here. Nobody goes to work on Wednesday the X Day - we call in sick "Sorry boss, puking and vomiting and diarrhea all night long. Not in today." Call and leave the message at 5am (can't argue with a message) - SICK OUT. And maybe somebody decides to sit down that day with 100000 of their close friends in the middle of Main Street - every Main Street - in waves. 3 pieces that could change history. Interested?
1. Card Check NOW
2. Single Payer NOW
3. Out of Iraq/Afghanistan NOW
If we hit those points, it will start an avalanche. Card Check - as originally written - changes the balance of power in the workplace; Conyers Medicare for all DESTROYS the Corporate lock on Health Care and frees massive sums not spent on corporate richfilth animals. Out of Iraq puts our Thumb in the eye of the MIC and frees BILLIONS AND BILLIONS of our $$$ to work here at home. Those three will shatter the dam. No ambivalence. Each of these is already written and OUT means OUT.
I'm tired of talking folks. It is past time we reminded these animals of what real Americans are about when they get fed up with richfilth bullies who think they own our world. THEY DON'T, we've just let them use it a lot longer than we should have. WE HAVE CHANGED OUR MIND.
Our parents and grandparents did not fight Adolf Hitler so that we could lay down for the grandchildren of the double Traitor Prescott Bush, and his current Overseer. No more Richfilth Traitors making our country a land of torturers, usurers, and degraded despots.
WE ARE NOT ENTERTAINED!!
Are you will to ACT? Are you willing to take back your Country?
Simple question, YES?
I'm in, but I might say that 2 days may not be long enough to get this organized in a meaningful way.
By the way just so that folks know.
Israeli companies are suffering losses which they in part attribute to consumer boycotts of Israeli Products. The hi-tech industry is being hit especially hard.
The EU, North America and the WEST BANK are the three largest destinations for Israeli goods and all three areas have ongoing boycotts.
This is prompting Israel to ask for more aid from the USA.
Boycotts work. Shop at Mom and pop shops and let the wal-marts rot.
Yes! We are all responsible as consumers and cast a vote with each purchase we make.
We may not have time to organize a "sick out" but if even a handful of us call in sick, it could make an impact. I'm asking everyone I know to join me in my "go to work dirty wednesday" movement. It's a way of speaking truth to power using the silence of poor hygiene to make my point. It's effective and always gets people's attention, expecially those with a sensitive nose.
This article doesn't even mention some of the other ways in which we are getting doubly charged for what WE used to own. How about our "justice" system, which no longer provides anything but extortion. Or our roads and bridges which are now largely privately owned, and NOT maintained worth a damn. The costs to US are far higher than they used to be for the same or worse services all so the rich can profit from our use.
The rich bought up everything that the righties turned over to them that the gov't used to do, and they have profited from these things dramatically, while we have had to pay for not only the services, but for the profit levels as well.
The whole Reagan era demand for profit to be the driving force in everything has done very well for those who owned everything at the time, and has cost the rest of us dearly, in some cases, everything we had at that time.
We shovel far more than just those taxes into their pockets every year, we have turned over the very basics of our society to them as well, and to our own detriment. It's time to take those things back from the rich and let them just get along with the billions they have amassed so far. They have FAR more than anyone would ever need in a host of lifetimes, and they don't deserve what they have. There are some things that the gov't SHOULD be responsible for, like prisons, for instance, so that they aren't abused for profit. The roads and bridges that WE paid for should be OURS, not open for profit. The hospitals that WE paid top build should be open to ALL, and not held hostage to those who have the most money.
We are no longer a country that cares for it's own people, we just worship money, and that is just as useless and evil as humans can be. I HATE what the republicans and big money have turned this country into. It's time to take it back and send them off to some island and let them have the country they want. The rest of us can get on with having an actual SOCIETY. The rich have what they wanted, more money than they can choke on. The rest of us just wanted a life that we could feel good about, and pass on to the next generation.
"Internal Revenue Service figures show that almost half of our country's income goes to the richest 10% of Americans (those making at least $283,000 a year). The distribution of wealth is even more skewed, with the richest 1% of Americans owning more than the poorest 90%."
You wouldn't know this from the MSM. And even if you did, relentless jingoist propaganda formed a great wall of China to keep it from the brain.
"A progressive income tax is the best way to do this, no matter how much yelling we hear from the top."
It hasn't worked because the rich make the tax rules. It could work if done direct democratically, by referendum.
This also has implications for global warming and other issues. "We Americans" are not all of one cloth. Some have to cut way down on excess, while others are in need of basics.
Joe
What about spending in all the wrong places such as wars and what about the actual costs of privatization, deregulation, etc ... against the taxpayers? Yes, I strongly agree that excessive tax cuts and loopholes for the wealthy is ailing America. We can complain about not enough taxes or too little taxes but in the end, it's how it's spent wisely that determines how badly our country is ailing.
Everyone knows that only the rich can trickle money down to the down trodden masses.
Why , if we had jobs that paid real living wages, we would just squander our money.
Thats why the Reagan Capitalists and Clinton made sure that deregulation and NFTA and GAT shipped all our high paying jobs to third world low paying labor.
We don't need money to pay for the most expansive health care in the world, home owners insurance,energy costs, housing, cars made in other country's that do not have to import our cars.
And so on, etc,etc,etc.
30 years of republican rule, and the capitalists have all the money now, and rest of us are broke.
Thing is, there are just as many hard working republicans having money issues as there are democrats.
BornFreeMen
"In today’s world, the easiest way to obtain wealth by old-fashioned “primitive accumulation” is by financial manipulation. This is the essence of the Washington Consensus that the G-20 support, using the IMF in its usual role as enforcer. The G-20’s announcement continues the U.S. Treasury and Federal Reserve bank bailout over the past half-year. In a nutshell, the solution to a debt crisis is to be yet more debt. If debtors can’t pay out of what they are able to earn, lend them enough to keep current on their carrying charges. Collateralize this with their property, their public domain, their political autonomy – their democracy itself. The aim is to keep the debt overhead in place. This can be done only by keeping the volume of debts growing exponentially as they accrue interest, which is added onto the loan. This is the “magic of compound interest.” It is what turns entire economies into Ponzi schemes (or Madoff schemes as they are now called)." - Michael Hudson, "The IMF Rules the World"
The plan is to reduce most of the world's population, including Americans, to perpetual debt slavery. What if we just refused to cooperate? Our sense of freedom would begin to grow and their power would begin to shrink. In the end, all their wealth depends on our active cooperation in their plans.
Before a progressive tax; have a one time tax on all property controlled by the rich-say at a 90 percent rate.
Yes, it is confiscation; but they deserve it, and it will still leave the rich, very wealthy.
discover and ratify the lost 13th amendment;"titles of nobility." lasting honest change must begin here.