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Weep for the rich and the tax burden they bear.


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We hear the plight from the TEA partiers about the heavy burden of taxes born by the rich. We hear how the upper 5% pay over half of the taxes in this country, and how deeply unfair that is. We hear that, despite tax levels being the lowest in half a century, that people are "taxed enough already".

Of course, the opposite side rarely gets told--the upper 1% collect nearly a fourth of the national income and the top 5% control 72% of the wealth in this country. Those numbers are up significantly from what they were in the 1970s, showing that the rich have been getting richer while the poor have been getting poorer (confirmed by the article below). So by those numbers, the rich should be paying MORE of the tax burden.

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And contrast it with this:

top_50__of_wage_earners_pay_96_09__of_income_taxes.Par.0008.ImageFile.jpg

Notice that while the top 10% ONLY pay 65% of the taxes, they nonetheless hold 83% of the wealth? Oh, the heavy tax burden those evil communists have placed on these upper income earners! What suffering they must endure! :lol:

Taxed enough already? Not even close.

http://www.inthesetimes.com/working/entry/5940/disparity_between_productivity_and_pay_3_trillion_a_year/

The growing economic polarization of America is increasingly obvious, if not a major topic of discourse in mainstream corporate media.

As Les Leopold notes in The Looting of America, the richest 1% of earners collected 8% of national income in 1973. "By 2006, the top 1% got nearly 23% of the pie, the highest proportion since 1929, " he writes. Moreover, the richest 1% now earns more than the bottom 50% of Americans. During almost exactly the same period, the pay gap between the top 100 CEOs and workers rose from 45 to 1 in 1970 to Himalayan proportions in 2006, reaching 1,723 to 1, Leopold says, citing data from Forbes.

But one of the most significant and least-discussed elements in the stunning polarization of America is the extent to which rising productivity has become unhitched from the way that its rewards are distributed.

PRODUCTIVITY UNHITCHED FROM WORKER PAY

Leopold lays out the astonishing data on this disparity:

By 2007, real wages in today's dollars had slid from their peak of $746 per week in 1973 to $612 per week--an 18% drop. Had wages increased along with productivity, the current average wage for nonsupervisory workers would be $1,171 per week--$60,892 instead of today's average of $31,824.

Our real average compensation is now about $25 per hour, including all benefits, representing a small increase from the early 1970s [in part created simply because of the sharp rise in health costs.] If it had risen along with productivity, it would be more like $41 an hour. The productivity bonus--about $16 an hour--is still AWOL.

Over roughly the same period, the ratio of household debt to income went from 55% to 127%, as Americans tried to make up for the loss of real wages with increased use of their credit cards.

American families have found themselves with vastly reduced time off the job, losing vacation days, sick time, and other leave. Until the recession hit, we were working the longest hours in the world.

So although we are producing more, working longer hours (if we are working), and have taken on unsustainable levels of debt, working people are falling further and further behind. The number of home foreclosures, for example, is expected to go from 2.8 million in 2009 to 4.5 million families losing their home in 2010.

$3 TRILLION SUCKED UPWARD TO INVESTOR CLASS

Instead, the additional income generated by US workers has been redistributed upward. That means about $3 trillion more flowing each year mostly "to the investor class all over the world, " as Leopold puts it.

There are three chief reasons why the $3 trillion has been sucked upward. First: U.S. corporations have used the threat of relocation to Mexico or China to ratchet down US wages.

Second, millions of Americans have lost the right to bargain over their wages as heavily-unionized manufacturing plants have been shut down and often relocated in low-wage nations. We have lost 5.6 million industrial jobs--about 32% of the total--since 2000 alone.

Third, the right to form unions has suffered a de facto repeal. Employers realize that they can intimidate and fire pro-union workers (over 31,000 in 2005 alone, according to State of the Unions author Philip Dine) without repercussions, so an atmosphere of fear and anxiety haunts American workplaces.

Thus, American workers will not even begin to be able to claim what is rightfully theirs--some $3 trillion in annual income--until the labor movement can crack that sense of intimidation and powerlessness.

PAYOFF FROM POLITE LOBBYING?

With President Obama surrounded by Wall Street believers in trickle-down economics like Lawrence Summers and Timothy Geithner, we should have no rational expectation that more polite lobbying in Washington D.C. will make any difference.

We will neither produce meaningful legislative changes nor break through the fatalism that working people seem to feel so deeply these days.

US labor needs desperately to inspire and support workers at the grassroots level finding leverage over corporate power, whether it be fighting plant closings or resisting foreclosures.

Only when we have successfully exerted some power at the local level, can we hope to command respect (as in, instill fear) and wrench real concessions from the Obama administration and the Democrats in Congress on real job-creation programs, curbing the relocation of U.S. jobs, and restoring union rights.

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Go ahead, tax the mortal stew out of them. Bleed em dry, make em pay dearly. Make sure when they start to pull their money out of the economy that you have a backup plan for the job you wont have. You really think that the wealthy are going to idly sit by while you bleed them dry? They didnt get to where they were by being stupid. When Kennedy cut top marginal rates from 70% to the 30`s the economy took off. When Reagan cut top marginal rates the amount of money that the treasury took in doubled in his time of office. How did all of this happen?

It happens because when you are allowed to keep more of what you earn you invest more, you put more money into play. This creates jobs and turns tax eaters into tax payers. All of this is all for nothing if you continue to spend like drunken sailors like both parties love to do. Look at Greece. A Wakeup call for the world if ever there was one.

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But we need the rich to get richer. We want them to trickle down some of that loot for us poor schnobs at the bottom of the scale. It'll happen if we just give them more time. :ph34r:

You'll see. Otherwise, Ronald Reagan was either wrong or duplicitous.

ronald-reagan1.jpg

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Go ahead, tax the mortal stew out of them. Bleed em dry, make em pay dearly. Make sure when they start to pull their money out of the economy that you have a backup plan for the job you wont have. You really think that the wealthy are going to idly sit by while you bleed them dry? They didnt get to where they were by being stupid. When Kennedy cut top marginal rates from 70% to the 30`s the economy took off. When Reagan cut top marginal rates the amount of money that the treasury took in doubled in his time of office. How did all of this happen?

It happens because when you are allowed to keep more of what you earn you invest more, you put more money into play. This creates jobs and turns tax eaters into tax payers. All of this is all for nothing if you continue to spend like drunken sailors like both parties love to do. Look at Greece. A Wakeup call for the world if ever there was one.

Read the article and get the facts before responding. Nobody is talking about "bleeding them dry" and nobody wants to go back to the 70% top marginal tax rate. The plans being discussed is raising their tax rate--already at historical lows--by 3-5%, a change that won't even come close to bringing their share of the national tax burden to their share of the national wealth.

Also, Clinton raised taxes on the rich by a modest sum in the 1990s. What happened? Oh yeah, an economic expansion that was longer and more sustained than the expansion under Reagan.

Shifting jobs overseas? Well h***, we've been lowering the taxes on the rich since 1980 and what's happened? Oh right, the corporations have been steadily moving jobs overseas and using that as an excuse to expand hours, reduce benefits, and lower wages.

So your narrative about the poor overtaxed rich moving jobs across borders because of high tax rates = fail. The facts just don't support your story.

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It doesn't really matter how much "wealth" the top 5% or whatever control.

We don't tax wealth. We tax income.

We do tax wealth in the form of property taxes and other taxes. But again, the point is that the people who hold the vast majority of wealth in this country are not paying an equivalent percent of the tax burden, largely because the tax laws are written to protect and minimize the tax burden of the richest people in this country (e.g., income from capital gains taxed much lower than income from salaries and hourly wages).

The rich are not overtaxed. If anything, they're not paying their fair share, especially considering that their income has increased dramatically since the 1970s while middle and lower class earners have seen their incomes fall.

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Bill Clinton was on his way to becoming a one and done President until he decided to play ball with the Republican Congress. And it was a Newt Gingrich led Congress that led the economic expansion of the 90`s. By the way, how did tax on luxury items work out for ole Bill? Can you say MIA CULPA?

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Look at Acworth making stuff up again. No one said the rich would suffer from higher taxes because that would be blatantly inaccurate. The argument is and has been that when raising taxes on the "rich", it effects us all...it HAS to.

"Making stuff up"? Translation: "Citing facts that don't support the fraudulent 'taxed enough already' narrative from tea partiers."

The article you cite deals with taxes on BUSINESSES, not taxes on UPPER INCOME EARNERS. There is a huge difference. If you increase the capital gains taxes (with an appropriate exemption for modest yearly gains) that isn't taxing businesses, it's taxing shareholders for their income. If you increase the income tax on those making above $250k a year, that's not taxing businesses, it's taxing people's personal incomes. So nice attempt at a red herring.

Also, the storyline from conservatives seems to begin and end with Reagan, whom the article called "the greatest president in recent memory". But that was thirty years ago. Since then we've seen a period when taxes on the wealthy were raised (Clinton in the 1990s) and we had a large economic expansion. Since Reagan, too, we've had lower taxes on the rich at several points and we can judge how that has "trickled down" to the lower income earners:

Fig4.jpg

The rich have seen a 72% increase in their income since Reagan's tax cuts while the poor have seen between an 8% to a 17% DECLINE in their income, even while workers are logging longer hours and have reduced benefits. Tell me again how lower taxes for the rich "trickles down" to the poor?

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Bill Clinton was on his way to becoming a one and done President until he decided to play ball with the Republican Congress. And it was a Newt Gingrich led Congress that led the economic expansion of the 90`s. By the way, how did tax on luxury items work out for ole Bill? Can you say MIA CULPA?

And yet the economy boomed after he raised taxes on the rich. Again, the facts prove your story false.

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If being the nation that is ranked the 2nd highest in the world a s far as corporate taxes seems like we've been lowering taxes then you might want to re-think that.

Ah, so even while you fabricate claims you accuse me of "making stuff up". Your claim is only correct when looking at corporations earning between $15-18 MILLION a year. The rest of the corporations pay lower taxes, and the smaller corporations pay much lower taxes than they do in other countries.

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Modern businesses will only raise prices if the market will withstand the price increases and at some point, they will price themselves out of business. This wouldn't hurt John Q. Public because he's doing service work nowadays, not producing the business's goods and services.

I'd rather sell a million biscuits with ROI of 10% than half a million and take 15%, but most modern businesses don't think that way. They have absolutely no plans to invest in America, so the money the make/save goes into their pockets and the economies of China, Korea, and many other business-friendly nations. This recession was inevitable.

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Minimal in comparison to the amount of income we take.

How is that? They hold the vast majority of wealth in this country and we only take about 30-40% of their income each year (salaries, wages, and capital gains combined). Seems the "minimal in comparison" is in precisely the opposite direction.

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Minimal in comparison to the amount of income we take.

If you could take all of the money from the rich ,it wouldnt solve the problem we have with our mounting national debt. We all have heard the argument about how we need immigrants to grow us out of our Social Security crises but the same group doesnt want to acknowledge that by growing the economy we can do the same thing. The answer to our economic crises doesnt lay with the middle class. How many poor people ever gave you a job? You cannot attack the job producers in this country and not suffer the consequences. Socialism doesnt work. Even the brand you are advocating.

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It's good to cite this graph again, because the implications are jaw-dropping:

Fig4.jpg

Half of the country has seen its income DECLINE over the past thirty years. And there has only been significant increases in income for TWENTY percent of the country. ALL of the decline is concentrated among the lower half of income earners while ALL of the gain is concentrated among the upper 20% of income earners.

Let that sink in a minute and then explain how we can keep making the same failed arguments about lowering taxes on the rich (or increasing services for the poor). The entire economic system in this country is broken right now, and the same platitudes from both sides won't fix it.

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How is that? They hold the vast majority of wealth in this country and we only take about 30-40% of their income each year (salaries, wages, and capital gains combined). Seems the "minimal in comparison" is in precisely the opposite direction.

Because their income is not relative to their wealth. The middle class, in particular the upper middle class, are much more heavily burdened relative to their wealth. Tax rates have nothing to do with fairness and everything to do with milking the most revenue from whatever source can be milked.

And the poor are for the most part not taxed at all on their income, so if we're talking about fairness, they not only are not paying their "fair share," they aren't paying a "share" at all. In fact, a great many of them receive back more than they "pay," meaning they are taking, not paying.

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If you could take all of the money from the rich ,it wouldnt solve the problem we have with our mounting national debt. We all have heard the argument about how we need immigrants to grow us out of our Social Security crises but the same group doesnt want to acknowledge that by growing the economy we can do the same thing. The answer to our economic crises doesnt lay with the middle class. How many poor people ever gave you a job? You cannot attack the job producers in this country and not suffer the consequences. Socialism doesnt work. Even the brand you are advocating.

More of the mindless "socialism" platitudes here. Again, workers have seen their hours get longer, their benefits reduced, and their incomes decline even through all of these periods of "growing the economy". Ignore the simple facts all you like, but your claim that "growing the economy" by lowering taxes on the rich (which are already at historical lows) is debunked by the simple facts. Those policies have produced a nation where the rich are getting richer and the poor are getting poorer. The policies that produced this result (or at least did not do anything about it) are not going to solve it. Simple logic.

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How is that? They hold the vast majority of wealth in this country and we only take about 30-40% of their income each year (salaries, wages, and capital gains combined). Seems the "minimal in comparison" is in precisely the opposite direction.

Capital is taxed continuously, because capital is constantly circulated (wages, purchases, plant/facility, loans, etc). It isn't static. And when capital in and of itself increases because the managers of it were efficient with it, we tax that gain. GDP growth is dependent upon capital staying in the market, because it is the source of tax revenue itself, which is why capital gain, unlike income, is taxed at a lower rate.

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It's good to cite this graph again, because the implications are jaw-dropping:

Fig4.jpg

Half of the country has seen its income DECLINE over the past thirty years. And there has only been significant increases in income for TWENTY percent of the country. ALL of the decline is concentrated among the lower half of income earners while ALL of the gain is concentrated among the upper 20% of income earners.

Let that sink in a minute and then explain how we can keep making the same failed arguments about lowering taxes on the rich (or increasing services for the poor). The entire economic system in this country is broken right now, and the same platitudes from both sides won't fix it.

Your graph is flawed because it doesn't include government transfer payments, which massively subsidize the lowest income brackets.

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More of the mindless "socialism" platitudes here. Again, workers have seen their hours get longer, their benefits reduced, and their incomes decline even through all of these periods of "growing the economy". Ignore the simple facts all you like, but your claim that "growing the economy" by lowering taxes on the rich (which are already at historical lows) is debunked by the simple facts. Those policies have produced a nation where the rich are getting richer and the poor are getting poorer. The policies that produced this result (or at least did not do anything about it) are not going to solve it. Simple logic.

The problems we are having are not because the rich arent paying their fair share. We spend too much money, we try to be all things to all people. We take the incentive away from the rich and poor alike with our tax and social policies. Government has a place, but has to be the primer, not the fuel.

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Because their income is not relative to their wealth. The middle class, in particular the upper middle class, are much more heavily burdened relative to their wealth. Tax rates have nothing to do with fairness and everything to do with milking the most revenue from whatever source can be milked.

And the poor are for the most part not taxed at all on their income, so if we're talking about fairness, they not only are not paying their "fair share," they aren't paying a "share" at all. In fact, a great many of them receive back more than they "pay," meaning they are taking, not paying.

That strikes me as a strong argument for the estate tax--taxing the wealth itself in addition to the income acquired off of that wealth. You are right that the upper middle class, by which I understand people in the 15-30th percentiles (about $70-125k a year), pay higher taxes relative to their wealth. But they are not in that upper 10% who pay 65% of the total income taxes compared to holding 83% of the total wealth in this country. It's the people that make $200k and above (e.g., the upper 4%) especially who are not paying their fair share relative to wealth. So your post actually supports my point--people making over $200k are paying far lower taxes relative to wealth than other people.

As for the poor, it's not about "fairness", it's about decency. Taxes take food off the table and takes away other necessities. The people with the means to pay taxes should pay them. Those that can barely afford to live shouldn't. But funny enough, the people at the bottom actually pay a higher share of the tax burden relative to their share of national income:

Is%20-Tax%20Day-%20Too%20Burdensome%20for%20the%20Rich-%20-%20Powered%20by%20Google%20Docs_1271267556720-thumb-454x287-18279.jpeg

Edit: The graph actually undermines my claim, sorry. However, notice that the disparity is not very great, certainly not as great as it has been described by the right.

Edited by AcworthFalcFan
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