werepossum
Elite Member
- Jul 10, 2006
- 29,873
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Translation: I don't want to seize and redistribute wealth, I just want to tax higher incomes and higher rates and give that money to people with lower incomes. As long as I don't call it wealth seizure and redistribution, I can continue lying to myself and anyone else with a very weak mind.I never offered that we should seize & redistribute wealth, merely tax higher incomes at higher rates as an issue of economic self defense for working people. Although the mechanism is poorly understood, extreme concentration of wealth & income creates extreme instability in any economic system, apparently through the mechanism of substitution of excessive credit for wages. It's what happened in 1929, and again at the end of the housing bubble. When wealthy interests are allowed to do that, the effects are disastrous & long lasting. As their holdings increase, the ability to make a profit increases inversely, simply because the ability of the general population to support such profit taking has been diminished. So they take greater risks in the extension of credit, create elaborate mechanisms to conceal that risk, until it falls down simply because of the inability to pay.
It's not like the post WW2 period, when taxes were much higher for enormous incomes, wasn't a period of strong innovation & growth, at all. The notion that innovators will not innovate in the face of high taxes is completely unsupported. The notion that such is the source of most corporate profit in this country is also erroneous. Although the financial sector comprises 10% of GDP, it comprises 40% of corporate profits, and what they "innovate" hasn't been shown to be of real societal benefit, at all.
The notion that I want something for myself is erroneous. As I've said several times, I've done well, and with a little more luck will continue to do so. OTOH, as a member of the middle class, I see the explosive inequality in this country as tearing us apart, as depriving many younger people of the very opportunities that I had. Wealthy people are disinclined to invest in productive endeavors when they can make handsome returns from purely financial transactions which often amount to little more than asset stripping & transfering funds from institutional investors like pensions, 401K's & endowments into the pockets of hedge funds & private equity firms. It is, in all too many ways, a form of looting and of class warfare. "Growth" is meaningless to working people when they don't get a share of it, which is increasingly the case. "Growth" is less than meaningless when the labor participation rate is forced down even when so-called "growth" is occurring.
In the face of increasing concentration of ownership, of increased offshoring, of increased automation we face some stark choices. If we can't reverse those trends, and I suspect that will be extremely difficult, we need to accept the need for greater redistribution of income if we're to continue to have a broad middle class at all, a society where opportunity is also broad as well. We can't possibly thrive as a nation when having a job is a necessity and yet a matter of luck & privilege regulated by scarcity at the same time.
I actually agree with you on the dangers of wealth concentration, and I support policies that inherently increase the value of labor such as import tariffs (making it less profitable to move wealth-creating jobs to cheap labor markets) and curtailment of illegal immigration (which likewise increases the supply of labor, thus devaluing it.) However I understand one vital thing you miss. A broad middle class formed by redistributing others' earnings isn't a true middle class, it's an enormous welfare state.
The more we punish hard work and reward or reduce the penalties for not working hard, the fewer people will work hard. The less we reward risk-taking and the more we reduce its rewards, the less risk-taking we will have.