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The Tax Burden of the Very Rich
When there is an income tax, the just man will pay more and the unjust less on the same amount of income.
— Plato, The Republic
The purpose of this piece is to identify for readers how an unjust tax system treats the very wealthy. Once that is understood it is easy to understand Senator Orin Hatch’s recent comments.
In a little noted speech the Senator said that the poor need to “share some of the responsibility” for lowering the deficit and observed that the rich are paying too much in taxes.” In his remarks he observed that “The top 1 per-cent of the so-called wealthy pay 38% of all income tax, the top 10 percent pay 70 percent of all income tax and the top 50 percent pay almost 98 percent of all income tax.” Those were facts of which many, including this writer, were unaware and it immediately created feelings of compassion for those paying that much. Of course, compassion is slightly tempered when one learns that in 2007 the top 1 percent received between 21 and 23 percent of all U.S. income depending on what studies you read. It is also slightly tempered when one realizes that the bottom 50 percent earned only 12.3 percent of all U.S. income. Nonetheless, the rich are obviously paying too much and that explains why Republicans don’t want them to pay more.
IRS statistics released in May of this year reflect that in 2008, the most recent year for which statistics are available, the average income among the top 400 Americans was $270.5 million. In 2008 someone with that income would have paid about $50 million in taxes. (The effective rate on that income is about 18.1%.) Of course, if you are someone who has net taxable income of $60,000, after deductions and exemptions, and are, therefore, in the 25% tax bracket on all your income in excess of $34,500, you may wonder why you are in a much higher bracket than someone who earns $270.5 million. There is a perfectly logical explanation for this seeming (but not actual) inequity.
The main reason that the tax rate in the United States for the rich is low is that being rich, many of the rich do not need to work. It has long been accepted by Republicans in Congress, among others, that unearned income should receive more favorable treatment than earned income. According to the IRS, in 2008 only 8 percent of the income of the top 400 earners in the country came from salary and wages. Close to 10% came from dividends and about 56% came from capital gains. Happy to help those who have prospered, either through their own efforts or through a wise choice of ancestors, Congress decided that people who receive dividends should only pay 15% tax on those dividends. Similarly, Congress thinks that capital gains, subject to a few non-onerous rules, should only be taxed at 15%. There is another group with very large incomes that also pays tax at the 15% rate. Those are hedge fund managers.
Like the VERY RICH, among whom many hedge fund managers find themselves, money that hedge fund managers get from investors for managing their money is treated like capital gains and is taxed at only 15% even though to the unsophisticated observer money paid to them looks for all the world like the sort of money that the typical wage earner gets, except for its considerably larger amount than what most wage earners receive. (One commentator pointed out that if hedge fund managers paid taxes like the people earning $50,000 or even $100,000, the national deficit would be reduced by $44 billion in the next 10 years. In 2008 the top 25 hedge fund managers “averaged”: $1.01 billion in annual income. )
In 2011, the only worker who will pay as low a rate as the folks described above is the worker whose taxable income is less than $34,500. Workers with taxable income between that and $69,675 will find themselves in the 25% tax bracket and from there the rates go up to 35% which is more than twice as much as the rate at which the person with $1.1 billion in dividends and capital gains is taxed. There are, of course, many adjustments made in calculating taxable income and the actual percentages vary taxpayer by taxpayer. But the long and the short of it is that the taxpayer who wants the satisfaction of paying taxes at the same rate as the really rich should keep his or her taxable income under $34,500. For many, that will not be difficult.
It is possible that readers of this column will not understand why Mr. Hatch thinks the poor should do more. It is even possible that they will not find the foregoing an adequate explanation for why Republicans do not think taxes on the wealthy should be raised. They are not the only ones who are puzzled.
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61 Comments so far
Show AllThe parasites also pay no FICA tax on their unearned income.
Yes. The FICA tax Reagan doubled at the same time he lowered taxes on the rich. If every American had to pay FICA tax on every dime they earned from all sources, our FICA tax rate could be very low (I can't say how low, but much lower than the current 14% or so we pay). This would have great economic benefits, as your average wage earner would have a good deal more disposable income and we could even increase benefits.
Since these taxes do not stress individuals with such high income, how can they be called a "burden?"
That occurred to me too, but I think the title is meant to be ironic.
So Obama and the Democrats extended and expanded tax cuts including those for the rich and corporations and the focus on why the Republicans won't give the tax cuts back. Ugh, no talk of responsibility!
I understand the idea here that the author is equating total amount taxed rather than % of income taxed as the basis for comparing and justifying the idea that the rich are taxed to highly when compared to the majority of society.
There is of course one major flaw in this logic. Comparing % of earned income one would say that everyone who pays taxes "pays his equal share" but comparing total amount taxes one cannot make that assessment as the numbers are skewed as the wealthy have more money and thus can/do pay more per % of income towards taxes.
Lastly, the author correctly points out that the tax system for the rich is based on concepts that once you get rich you should no longer be forced to work. The biggest problem here is that one could make the argument that for a person to have enough accumulated wealth and not work doesnt mean the person should pay less % of income than his poorer counterpart who works in order to maintain a basic living standard. This last point reflects the Idea of the flat tax. ie. if the rich are going to only be taxed around sat 15% than all tax payers should only pay 15% to thus responding to Plato's logic.
I also think its not productive for the author to leave out a small point concerning excess government spending that created this mess.
"excess government spending"
Incomplete sentence... Excess spending on? Give us the list or quit using that tired phrase.
I'll finish it for you Excess Spending on War.
dmg...
Excellent point.
"Endless money forms the sinews of war."-Cicero [106-43 BC], Roman statesman and philosopher
What? How clever the logic:
I have taxable income of 3 bazillion dollars and pay 15%. I do believe I deserve to keep 2.55 bazillion dollars after tax because after all, I'm white, worked hard, got thru community college, then got really really lucky when I married this chick who's great grandfather started an oil company in the 30's. I mean, how hard he must have worked to be able to make money on something like oil. But, I digress.
Shlomo makes $38000 (working 3 total shit jobs) but pays 28% and keeps $27, 360.
So, all we have to do is lower Shlomo's tax rate to 15% - he'll now get to keep $32,300 or put another way, you just gave him an additional $4940 per year! Woo Hoo!
Yeah, he shoud thrilled with that. I know I am.
Brilliant.
God! I just love the people on CD! Ya all make my day!
Another comment asked Phil to list the excess government spending, and starts the list out with spending on War. I would elaborate by saying the Defense Department which includes all military spending including that on all weaponry.
I would also add to the list `corporate welfare which is so pervasive we can't even recognize it when we see it.
I've taken the advice of another CD contributor a few days back and have begun reading Naomi Klein's "The Shock Doctrine." Very illuminating vis-a-vis the so-called Chicago School of economics out of University of Chicago which Milton Friedman and other ultraconservatives brought about in order to privatize and deregulate as many societies as possible and to eliminate what they called the welfare state. They started in the 50s with their connections to the Eisenhower administration to put the Shah in place in Iran, and to effect a coup in Guatemala to overthrow a progressive leader with the help of the United Fruit Company. Their influence has been felt all over the world, including in Argentina and Chile during the 70s. It's an ugly story that over and over shows the power the rich and greedy have over ordinary human beings.
Add the book **Sugar*** to your reading list.
by whom?
It is actually worse than that when you add in all taxes, including sales taxes and other state and local taxes. In many states, including Texas, the rich pay a lower overall tax rate than the poor or the middle class. It sure must be difficult for the very wealthy to ask their friends for advice on choosing a good investment advisor, because that is all the work that some of them do to earn all these advantages.
Calling on mathematicians for some help here.
Pfizer's CEO makes $47,000,000 a year.
A father of two makes $60,000 a year.
$___________ is to the Pfizer CEO what a penny is to the father of two.
47,000,000/60,000 = 783.33...
So $7.83
Right, it's $7.83.
But that is not an accurate way to understand the value of money to the $47 million income compared to the $60 thousand income.
What we really should do is compare their surplus money, or what they could give themselves as a personal allowance after paying all their bills including saving for retirement.
To be really fair we should compare them living at the same lifestyle, but let's be pragmatic and allow the wealthy to live at a wealthy lifestyle.
So we put the middle class person in a 30 year mortgate for a $200,000 dollar home.
Using a mortgate calculator at http://www.bankrate.com/calculators/mortgages/mortgage-calculator.aspx and the current mortgage interest rates for a 30 years fixed mortgate of 4.25 from http://www.google.com/search?client=safari&rls=en&q=current+mortgage+interest+rates&ie=UTF-8&oe=UTF-8
The middle class person buying a $200,000 will have a yearly mortgate of $11,800. The wealthy buying a $1 million home will pay a yearly mortgate of $60,000. But let's assume they buy a $20 million mansion. The calculator I found only went up to a million, so we'll assume that a $20 million mortgate is 20 times the $1 million one, or $1,200,00.
The middle class person buying a 2011 Toyota Camry with a 36 month loan will have yearly payments of $4,200 according to http://www.leasecompare.com/quick_lease_quotes.php?ModelYear=2011&MakeID=820&ModelID=165&StyleID=119&v
The wealthy person leasing a 2011 Toyota Lexus will have yearly payments of $148,800 according to http://www.autoblog.com/2010/03/17/lexus-lfa-lease-for-12-400-per-month-298-000-due-at-signi/
According to the FDA a liberal annual cost for feeding a family of four is $13,300 according to http://www.cnpp.usda.gov/Publications/FoodPlans/2008/CostofFoodMar08.pdf
Let's be REALLY generous in feeding that wealthy family, let's figure they spend 100 times more, which is $1,330,000.
For other household bills I'll use personal experience to estimate the middle class annual expense. Going with a low ball it's about $10,800. Again lets be really generous and figure the household bills for the million dollar house will be the same ratio as for food, or 100 times as much, which is $108,000.
Finally we need to add debt payments. Let's assume the middle class family is carrying $10,000 on credit cards and from personal experience that is $2,200. I'm assuming someone with $47,000.000 yearly income doesn't have to go into debt with credit cards so theirs is $0.
But the wealthy family hires servants. Let's assume they have three full time workers. One is a highly trained butler. An accomplished butler after a few years of good service should cost about $150,000 according to http://www.butlerbureau.com/html/domestic-staff-salaries.html We'll assume the others are illegal immigrants being paid minimum wage plus social security and medicare (our wealthy family isn't cheating.) That is $7.25 an hour. That comes to $15,100 per servant and adding social security and medicare of 5.65% it comes to $16,000. That's $48,000 for three. So the total servant expense is $198,000.
The common wisdom with a 401(K) is that if you contribute 10% of your income for 40 years with normal matching employer contributions, then you will have a much larger income from your 401(K) after you retire than before. I doubt that. But let's assume both put away 10% thinking this.
So that $6,000 for the middle class family and $4,700,000 for the wealthy.
What's this all add up to?
Middle class family's annual living expense: $59,100. That leaves discretionary money of $900.
Wealthy family's annual living expense: $7,700,00. That leaves discretionary money of $39,300,00.
Let's assume I REALLY underestimated how high the wealthy family is living. Let's just double their living costs to fix that. That's $15,400,00 with discretionary money of $31,600,00.
What's a discretionary penny for the $60,000 person compare to for the $47,000,000 person?
31,600,000/900 = 35,111.11...
or $351.11
I agree that a simple calculation tells one almost nothing, but that seemed to be what was asked for, and so I hesitantly provided it. It is difficult to come up with a precise comparison, but possibly the most important fact is that in a system without guaranteed medical coverage the money that is taxed and removed from the middle class family could have been necessary to save a family member's life, which would have incalculable value, while the money taken from the wealthy family (unless using a tax rate approaching 100 percent) almost certainly would not be necessary for such a purpose. And besides medical care there are other items of almost incalculable value such as education, proper nutrition, a clean environment, etc..., that the middle class family could miss out on because of the obligation to pay the tax while the wealthy family would not. Generally, given that life is a dynamic process, where each event is based on preceding events, and problems as well as advantages tend to grow over time, the ratio of the value to the middle class family of each dollar compared to the value to the wealthy family of each dollar would likely grow over time according to some exponential function.
Way back when I was young, just after high school I worked at a car dealership washing cars. One thing I learned; rich people do not have to take on car payments. Back then they wrote checks for new cars, now they probably put them on the Amex.
(double post deleted)
Meeting in the nearby glitzy isolation of Aspen, Colorado where the rich and powerful elites gather each summer to further develop their plans for the US empire and how to keep the domestic US population distracted and controlled, the Republican Governors Conference is now taking place. Bob McDonnell of Virginia said the notion of taxing the rich has "Devolved into class warfare". My, my, he must have spoken between bites of truffles and lobster, the usual fare of the Aspen elites, while the down valley servant class nibbles the leftovers in the kitchen. Don't expect to learn much about these ruling oligarchys and their summer long series of Aspen meetings from the corrupt lapdogs of the NY Times or NPR. After all they have just gathered to figure out how to loot the working people and environment of the globe, so what's newsy about that? A noisy parade down Aspen's main street shouting "Tax the rich, tax the corporations" might cause a panic, as they fled to their million dollar enclaves/castles or ran for their jet planes to escape the rabble. Maybe one day there might be the equal of the Madison events right in Aspen, when the downtrodden people finally understand who their real corporate and government oppressors are and where they hang out and plot together every summer.
We need a real class warfare. They have the money, but we really outnumber them. The problem is in the structure of our government. Our "representative" democratic form allows for too few representatives, thus allowing the rich to buy all of them. We have had 435 members of congress since the 1920s, because congress passed a law limiting their membership to 435. We had about 106,000,000 people in 1920, and about 311 million today, but we still have 435 representatives and 100 senators. If we had to change anything in the constitution, I would limit a congressional seat to less than 500,000 people, maybe much less, and let congress work like corporations, spread out in local offices and working on the internet.
Here here!
The act of governance in a true democracy should be everyone's job and responsibility!
Perfectly fantastic, tomcarberry!
Would it be possible to reduce the numbers Brauchli cites to a few graphs that readers could incorporate into letters to newspapers, blogs, posters and conversations?
The "income versus taxes paid" discussions are confusing because most of them confuse a number of things. For example, when someone says that the top 1% pay 38% of the incomes taxes collected, he usually does not say what that "top 1%" means. Does it mean those with the highest earned income (I doubt it), or does it mean those with the greatest amount of assets (earned and unearned income, as well as income taxed at the capital gains rate even if it really is earned income, etc.)?
By conflating the categories, as Senator Hatch did in his speech, you can make the numbers sound as good or bad as you wish.
In this article, Mr. Brauchli does not shed any light on what the numbers really mean, but one of the numbers he cites is tantalizing. He notes that the "bottom 50% earned only 12.3% of the nation's income. That is, half of those employed in this country make about one eighth of the total income in the country.
That is a lot of people who are dividing a fairly small percentage of the pie. Anyone who can defend that situation either does not understand what he is saying, or is callous beyond belief.
Exactly. But some marketting wizard sold the republicans on that line and many bought it. Imagine if they really considered that those receiving only 12.3 % of the nations income are paying 30% of the taxes collected. Paying almost three times their actual liability. You'll never hear a republic quote that.
I noticed Senator Orin Hatch's recent comments where the Senator said that the poor need to "share some of the responsibility" for lowering the deficit. I wonder what Hatch's net worth was before he took office and what it is now after a career of civil service? We will never know. The NSA can trace a $100 contribution to a Muslim charity but, cannot for the life of them figure how much our leaders have salted away in Swiss bank accounts.
In the 2010 NV senatorial debates, Sharron Angle asked Reid, "...you came from Searchlight [Reid's hometown] to the Senate with very little. Now you're one of the richest men in the U.S. Senate." Reid responded by calling the inference a ‘Low blow.' We will never know how much Harry is worth or how he became one of the richest men in the senate. I wonder if Reid declared his good fortune over the years and paid tax on his winnings?
As a radical majority of one, I pose the question - What is the value of the Bush family fortune? What does multi generational public service pay? From the 30's on: Hitler's banker, Head of the CIA (drug money?), White House for twenty years, the value of Daily White House Briefing info to the Carlyle Group. The NSA cannot do that math either.
The joke is on US. Our political leaders are commissioned agents working for tips - probably 15% tops. We never see the really huge money. Bill Gates' net worth was $56 billion in 2011. We think of Bill as the richest guy in the world. Mubarak had $70 billion hidden in Swiss bank accounts. What else he has, who knows? How did Mubarak accumulate more wealth than Bill made at Microsoft?
My point is that there is big money in government and bigger money controlling government. The big and bigger money is hidden from the tax man. I wonder if Orin thinks the poor should share in some of that upside? Where are our commission checks Orin? More outstretched hands! More burden for the very rich!
How many people are aware that insider trading is not illegal for members of congress or their staff? Not many I'd bet.
So, no. It would unhelpful to Orin for the poor to get in on this game.
Get out! Is that really true?
http://insidertrading.procon.org/view.resource.php?resourceID=001759
Very true. And nothing is going to be done about it. Bills like HR 862 have been presented to only fade into obsurity.
http://rightsoup.com/the-stop-trading-on-congressional-knowledge-act-hr-682/
Anyone who earns more than $10,000,000 a year, should pay 90% tax. Of course the rich will say "How can someone live on only a million dollars a year?" Is anyone really worth $10,000,000 or $100,000,000 or a $1,000,000,000 a year?
The problem here is value. Is a good plumber worth more than a bad talk show host? Is an ethical doctor worth more than a paid corporate lackey in Washington? Is a caring trash collector worth more than a celebrity model? Yet in none of these examples do we have an equitable distribution of income... or respect!
Any rich person who feels that they didn't really earn their money (i.e. inherited it) despise arguments about value towards society because they inherently have no value. How many times have we heard about rude millionaires speaking condescendingly towards blue collar help or threatening to sue a doctor or nurse despite the fact that they need these peoples specialized services?
Unfortunately there is an aspect of human nature at work here as well. Too often we have seen someone poor end up with a sudden lump sum either through a death in the family, winning a lottery, cashing in on an insurance settlement or some other windfall. That 'someone' all too often quickly changes their attitude towards the have nots and tries their best to emulate the arrogant and privileged class they despised just before receiving their fortune. Because of this, I don't think the wealthy are any better or worse than the rest of us, however they do reflect their shallowness with more aplomb.
A strong government is needed to protect society from ourselves as well as the nasty elite who only wish to perpetuate the disparity between the rich and poor. The United States corporate government is so far off the mark that I'm afraid we will either return to a slave/feudal sort of state or else embark on a violent revolution to level the playing field. In either case the future doesn't look bright.
Mr. Orin Hatch observed that “The top 1 per-cent of the so-called wealthy pay 38% of all income tax, the top 10 percent pay 70 percent of all income tax and the top 50 percent pay almost 98 percent of all income tax.” His sympathy is excited by the share of taxes they bear. Such sympathy is ill-directed.
Our economy and world is in trouble because these Have-More people are taking way more than their fair share of the gross domestic product. They are the people whose schemes and whiles have strapped the rest of us with impossibly expensive college costs, joblessness, underwater house values, ever higher prices, and personal bankruptcy. It is they who have devalued personal credentials (Mr. Gates didn't complete college; many of the wealthy didn't graduate from high school). It is they who allow and encourage recruitment among teenagers. It is they who fund Tea Party extremism and promote war. It is they who are Wall Street. It is they who took and pocketed all our bailout money and have created no new jobs.
Mr. Brauchli is wrong to support this group as if the tax laws unfairly discriminate against them. Plato had no notion of the injustice to be perpetrated on the majority of the world by this heartless minority inhabiting North America 2400 years in the future.
We must do something to stop the Have-Mores. They are, by and large, not nice people. They won't even willingly fling a coin to us beggars. As Dorothy Day used to say "Our problem lies with our acceptance of this dirty, rotten system". People who read Common Dreams (and who aren't trolls) have not abandoned ordinary people in favor of the corporate class, nor do we easily accept the bifurcation fallacy--so popular since Mr. Bush's good/ evil.
Dear dwyerj1:
Regarding your remark: "Mr. Brauchli is wrong to support this group as if the tax laws unfairly discriminate against them."
Someone has to tell you that Mr. Brauchi is not supporting the rich. His is using some tongue in cheek rhetoric. However, I believe your sentiments to be sincere.
I too hold out for the good in people to show up….someday. It’s that I have just learned not to hold my breath so long.
A couple of weeks ago, Democracy Now interviewed Alice Walker while she was on the intercepted US flotilla boat with aid for Gaza. It troubled me that "Oprah" did not step forward in support of her acknowledged mentor, Ms. Walker. Guess the billionaires only know you when you are $$ useful.
One other puzzle: Why is it impossible to negotiate prescription drug prices which would be a savings of billions for govt via taxpayers, but, oh, so necessary to make cuts to the benefits provided by medicare and social security.
Cui bono? When will the people ask??
To the people of Utah a question arises. When you folks have your Karl Mauldin moment and do something constructive to end libeling of your state? It's just a question. Do ponder same and thanks for the consideration.
I am from Utah and would like to answer your question, but I don't know what it is. Clarify it and I will answer it.. We once did somethin constructive once. We elected Rocky Anderson as Mayor. He did a great job, but the conservatives hated him.
Orrin Hatch is a pig. Supposed to be a caring Mormon, but like the rest of the so called christians in the Senate, they ignore the best of Christ's teachings. Help the poor and sick. Don't kill. Ignore the rich man's chances of getting in Heaven. Well, exceptvfor Hatch. For a Mormon to get to the highest heaven he has to be rich.
The 'stupid' people in UT deserve the libeling. Visit KSL.com sometime and check out the comments. A lot of them believe the same as Hatch.
Sadly, people often classify themselves for selfish motives. For example, minority group members might support another in group regardless of obvious destructive behaviors to society in general. Religious groups can follow suit. My church-devoted brother, in Southern Utah, recently quoted Hatch's statistics and supports cuts in "entitlements" to share the sacrifice. I ponder how many elderly will overheat/ freeze to death w/o sufficient income to dance with the utilities mafia. Orrin Hatch, Harry Reid, Mitt Romney, et al. . .you may take the sacrament but seems to me you're "under contract" to a different cosmic force.
Back in the late sixties or early seventies, I read that the highest per-capita use of valium was in the state of Utah. I wonder if that is still true today.
What? You were expecting Oprah to stand up for Alice Walker? You do remember that Oprah was quite instrumental in bringing us Obama, don't you?
No expectations. Just re-verified for me that she's in "The Club". Wonder how Oprah's exclusive African girl's school is doing?? Meanwhile 11 million Somaliis, mostly children, are dying of starvation. The human body is basically made of carbon. Soo. . . gotta reduce that carbon footprint! Cuts in social services will also push the agenda along. The Elites are actually quite tranparent.
I think the people have been asking.
In fact if would be interesting to have members of congress/white house/justice department post the letters and emails they receive online obviously omitting the names and addresses. We might gain a better image of what other people are asking of their government; but also how often the government ignores its citizens.
Also, in response to the question of: "excess government spending"
yes military and defense spending would be at the top of the list along with subsidies for private businesses.
I should say I am in the interim more interested in seeing Regulations em placed and enforced on the financial and "defense" agencies including private mercenaries. Than Increasing taxes on rich at the moment. I would also like import Taxes raised on goods that would otherwise be built in the USA with higher standards than sweat shop nations like China, India, Philippines, etc.
Next should come gouging the military industrial complex and closing bases overseas. Then the IRS should be given a larger budget in order to audit corporate and individual capital in order to determine who owes back taxes, before moving onto increased taxes for individuals and closing tax loopholes for corporations. Germany has a nearly equivalent Corporate tax rate at the USA around 40% but nearly a 50% personal income compared to the USA's 30%.
Social Security is paid for and should not even be discussed for cuts only for a way to get more money into the program. Medicare and Medicaid should be dissolved for a Socialist system like England or Europe. Insurance and Big Pharma have had their Fun for too long.
At this point ,do you actually think they care what we think? The only time they will care is if all of us show up knocking on the door of Congress.
Like many people, I'm constantly amazed at the continuing rage about taxes. Money is the solution to a question of debt and, as a nation, as a community, we all now that the money does exist. Who should contribute will always be the question but the basis for taxes is clear. Musgrave, in his classic text for the economics of taxation, offers these words by von Stein: "What I am, what I have, and what I do, belongs in some part to the community."
Missing from most of the discussions is the inverted happenstance of marginal tax rates. People in the lower economic groupings often face the highest marginal tax rates and almost never mentioned is the disincentive this imposes on them.
Along with that, we fail to understand that those 'capital gains' come in part from the contribution of the community and should be looked at as a reservoir when national debt becomes a problem. Since it is unearned income, how much can it hurt to give more to the community? The ability to give more makes me proud rather than angry.
You have accumulated much wisdom Grasshopper.
I'd like to know why the tax system is so regressive....wait...I think I know...the rich make up the rules! Silly me....
Given the power of "packaging" one's message properly, I would like to offer a re-branding concept for taxes that impact the top earners in this nation (AMT, Income, Capital Gains, Estate, etc.). We should quit calling what these people pay "taxes". Let us ponder a new label. I suggest the Don't-Cut-My-Head-Off-With-A-Butter-Knife Investment Program.
This cracked me up. I almost wet myself.
Taxes, so how long do you think it will take for the whole damn country to see what will happen to us without more tax revenues? How long do you think this country can run on empty?
I want to see the faces of the holier than thou tea-baggers when it dawns on them what in the hell taxes are really used for and who is not contributing their fair share. What are these people smoking?
This is the U-N-I-T-E-D STATES OF AMERICA. That means ALL OF US have a share in the running of this country. Those who wish to stay here have to contribute.
Those who do not want to pay their fair share should leave. If there is any hesitation they will assisted out of this country.
When they go, they will not be able to take the wealth that they have unfairly accumulated. It rightfully belongs to those in this country who in good faith paid their fair share of the taxes. These are the very same taxes that were used to run this nation. It is just that simple.
The lower tax on capital gains distorts the economy in many ways. Corporations become obsessed with increasing the value of their stock, so the stockholders and executives can have capital gains income instead of boring old salary to be taxed at a higher rate. Rather than making a profit on the use of property and resources, the goal becomes to increase their market value and then sell them. Laying off employees produces short-term increases in profitability and therefore in stock value, which is the real goal. Down the road the corporation founders because its valuable workers and thinkers are gone. Another example: the big payday for new corporations is when they "go public", not when they make a profit. So once they go public, they can fizzle and nobody cares except the poor chumps who bought the stock. If capital gains were taxed at oridinary income rates, these artificialities would be much reduced and perhaps we could rein in corporate excesses.