Mind Blowing Charts From Senate Income Inequality Hearing

[WackyDan]

I've never understood why so many liberals claim to be so smart yet they support higher marginal income tax rates. The most progressive tax is a real estate tax with a high exemption. Income tax is not a wealth tax and was never intended to be.

I don't advocate a wealth tax, but fiddling with the income tax code in the hope of punishing someone and getting more revenue is like beating a dead horse. They could reduce the top marginal rate to 20% and they could get more revenue than they would with it at 91%. There were more loopholes when it was 91% so revenues weren't higher. Marginal rates mean nothing and the wealthy write the tax code, so why would they not put in loopholes? Guess what Ted Kennedy did... he wrote the Federal Estate Tax, put a loophole in it, then didn't pay it. At least that's what I heard.

The Kennedy Family Trust was managed by Teddy... While he was a strong supporter of the estate tax, it is worth noting that the vast Kennedy fortune is in an offshore trust - Shielding the Kennedy family from that pesky estate tax.

 

[SagaLore]

http://m.motherjones.com/mojo/2012/02/mind-blowing-charts-senates-income-inequity-hearing

Someone help me understand this graph.

Distribution of capital income by income percentile, 2011. ...based on the income distribution of the entire population and contain an equal number of people, not tax units...

Okay so this means that each 20% is # of people, not sum of total income, nor contribution % of income tax, correct?

What does the total %'s represent - percentage of how much that group is paying into taxes? If that is the case, this is saying that 80% of the employed population is contributing 12.7% in taxes, while 20% is contributing 86%?

Something feels very misleading with this graph but I don't understand it enough to pinpoint it.

 

[BoberFett]

I totally disagree. Tax policy is, bar none, the most effective regulatory tool in the government's arsenal. Taxation is most certainly not only to provide the government with revenue, and to deprive lawmakers of such a useful tool would be a terrible idea.

And fools like this are shocked when they're on the losing end of things...

 

[BoberFett]

Because it has a proven record of altering unwanted behavior without having to resort to more heavy-handed remedies.

Really? It seems to me that it has a proven record of creating unwanted behavior. Have you completely missed the conversation in this thread? The rich are taking a higher percentage of this countries income yet their tax rates keep going down.

Give people a reason to game the system and they will. The tax code can be used to shape society, but I've got news for you sparky, you're not in control of it. The wealthy are.

It wasn't that long ago that the left was wringing their hands about GE and the fact that they paid no taxes on billions of dollars in profit. Oh wait, that's because they used the tax code to their advantage, using "green" incentives to eliminate their tax burden. You fools want things both ways. Good luck with that, fools.

 

[fskimospy]

Really? It seems to me that it has a proven record of creating unwanted behavior. Have you completely missed the conversation in this thread? The rich are taking a higher percentage of this countries income yet their tax rates keep going down.

Give people a reason to game the system and they will. The tax code can be used to shape society, but I've got news for you sparky, you're not in control of it. The wealthy are.

It wasn't that long ago that the left was wringing their hands about GE and the fact that they paid no taxes on billions of dollars in profit. Oh wait, that's because they used the tax code to their advantage, using "green" incentives to eliminate their tax burden. You fools want things both ways. Good luck with that, fools.

Your first paragraph doesn't help prove your point in any way.

Your last paragraph is just anecdotal evidence, which isn't useful. Foolish indeed.

 

[BoberFett]

Your first paragraph doesn't help prove your point in any way.

Your last paragraph is just anecdotal evidence, which isn't useful. Foolish indeed.

Do you have comprehension problems?

The tax code is being used as a tool. A tool to enrich the wealthy at your expense, fool. Isn't that unwanted behavior? Isn't that concept the whole point of this thread? If the tax code didn't have a million loopholes written into it to fulfill your authoritarian desires for control, the wealthy would be paying a higher rate.

Edit: Of course I have to remember the fool I'm trying to discuss this with recently with conflated "Bush tax cuts" to "tax cuts for the wealthy" and then argued for several pages about how everyone else was wrong.

 

[Ausm]

It's just that Democrats have an orgasm every time they see that 90%+ tax rate. It's the Democrat trickle down theory.

Government takes all the money you earn and then let's a small amount trickle down to you.

But your fine being raped in the lower percentile of income I take it then?

 

[monovillage]

But your fine being raped in the lower percentile of income I take it then?

No, I'm opposed to the government financially raping any citizen, even the poor ones.

 

[a777pilot]

I'm still try to understand why, in a free market based Capitalistic system, private real property and income/profits, from any source, should be taxed at all.

I thought those were good things. So why tax them? Makes no sense at all. There are other ways of getting the needed revenue for the proper functioning of governments.

 

[Throckmorton]

Someone help me understand this graph.

Distribution of capital income by income percentile, 2011. ...based on the income distribution of the entire population and contain an equal number of people, not tax units...

Okay so this means that each 20% is # of people, not sum of total income, nor contribution % of income tax, correct?

What does the total %'s represent - percentage of how much that group is paying into taxes? If that is the case, this is saying that 80% of the employed population is contributing 12.7% in taxes, while 20% is contributing 86%?

Something feels very misleading with this graph but I don't understand it enough to pinpoint it.

The percentages are the fraction of total income that each of those quintiles gets. The richest 20% of Americans earn 86% of all income. The 20% below them only get 6.6%.


Most of the top 20% isn't even that rich. The 1% gets 56.8% of total income!! The other 19% is left with 29.2% which is less than you would expect for the "upper class".

 

[ElFenix]

looking at marginal rates is misleading without at least some explanation of what deductions/credits/etc were available for each period as well. also probably as to what % of taxpayers did more than barely kiss that marginal rate.

The percentages are the fraction of total income that each of those quintiles gets. The richest 20% of Americans earn 86% of all income. The 20% below them only get 6.6%.


Most of the top 20% isn't even that rich. The 1% gets 56.8% of total income!! The other 19% is left with 29.2% which is less than you would expect for the "upper class".

no, that's capital income. which is necessarily less than income.

iow, wealthy people have wealth.

 

[SagaLore]

The percentages are the fraction of total income that each of those quintiles gets. The richest 20% of Americans earn 86% of all income. The 20% below them only get 6.6%.

Oh! Okay that makes sense now.

In that case, those figures are very sad.

 

[jstern01]

I'm still try to understand why, in a free market based Capitalistic system, private real property and income/profits, from any source, should be taxed at all.

I thought those were good things. So why tax them? Makes no sense at all. There are other ways of getting the needed revenue for the proper functioning of governments.

Because this is not a free market based capitalistic system. Has never been, will never be. Before there were individual and corporate taxes, there were tariffs. Just taxes in another form. As well as fees, stamps and other methods of government to collect revenue to finance their operations.

 

[Throckmorton]

Oh! Okay that makes sense now.

In that case, those figures are very sad.

Oh that chart is for capital gains not all income.

 

[Patranus]

Wait, the OP is saying the life isn't fair?

STOP THE PRESSES!!!

 

[a777pilot]

Because this is not a free market based capitalistic system. Has never been, will never be. Before there were individual and corporate taxes, there were tariffs. Just taxes in another form. As well as fees, stamps and other methods of government to collect revenue to finance their operations.

Then that is what we should return to, along with a system of sales/consumption/transfer taxes.

The budget proposed for FY-2013 is an estimated $3.8 trillion. That is with a $1.2 trillion shortfall. Please, some one, anyone, explain to me why this government/country cannot satisfactorily run on "just" $2.6 trillion.

 

[a777pilot]

http://blog.american.com/2011/10/tr...-over-time-shows-significant-income-mobility/

 

[Patranus]

Then that is what we should return to, along with a system of sales/consumption/transfer taxes.

The budget proposed for FY-2013 is an estimated $3.8 trillion. That is with a $1.2 trillion shortfall. Please, some one, anyone, explain to me why this government/country cannot satisfactorily run on "just" $2.6 trillion.

The 2006 budget, before Pelosi & Co. took control of congress, was $2.66 trillion.
People act like the federal government wasn't too big back then - which it was.

 

[a777pilot]

The 2006 budget, before Pelosi & Co. took control of congress, was $2.66 trillion.
People act like the federal government wasn't too big back then - which it was.

I agree. It was too big back then and it's way too big now.

 

[jstern01]

Then that is what we should return to, along with a system of sales/consumption/transfer taxes.

The budget proposed for FY-2013 is an estimated $3.8 trillion. That is with a $1.2 trillion shortfall. Please, some one, anyone, explain to me why this government/country cannot satisfactorily run on "just" $2.6 trillion.

Reality check, all of our free trade agreements took that option away. With the exception of spell rulings by the WTO (I believe) the US can not impose tariffs on those partners we have Free Trade Agreements. We allowed our stupid elected officials to screw us out of that option.

http://www.policyalmanac.org/economic/archive/tax_history.shtml

 

[a777pilot]

Reality check, all of our free trade agreements took that option away. With the exception of spell rulings by the WTO (I believe) the US can not impose tariffs on those partners we have Free Trade Agreements. We allowed our stupid elected officials to screw us out of that option.

http://www.policyalmanac.org/economic/archive/tax_history.shtml

That is precisely why we need a sales/consumption/transfer tax vice an income/profit tax.