The real class warfare and who's losing

[SamurAchzar]

We have a system that has redistributed wealth and income to the top for the last 30 years, radically changing the income demographics of this country. In 1980, the top 1% had <9% of taxable national income and paid 33% average in federal taxes. They were nonetheless rich by everybody else's standards. Today, Their share of national income is >20% and their average tax rate is ~22%, with the highest earning 400 paying <17%. But today, they're trying to shift the tax burden even further downscale with deceptive and simplistic tax proposals of all kinds, schemes where they would pay even less. They've even gone so far as to hold the unemployment compensation of millions of unemployed Americans hostage to keeping their most recently acquired tax breaks.

As a % of GDP, Federal revenues are at their lowest point of the post-WW2 era, which means revenues can and must be raised. There's obviously a sector of the population who can easily afford to pay more, where tax increases will achieve the greatest yield, and that's at the top.

"Conspire against the Rich?" You make fair & open discussion of tax law in a democracy sound like calls for the dictatorship of the proletariat, when no such thing is happening.

Bill Gates
Larry Ellison
Jeff Bezos
Mark Zuckerberg
Segery Brin
Larry Page
Michael Dell
Steve Ballmer

This following list is recited from the Forbes 400 Wealthiest People of America list. Would you be so kind and explain to me what exactly is the wrongful policy that made them so unbelievably rich, thus enlarging the disparity in income - and how do you suggest it is rectified?

 

[Jhhnn]

Bill Gates
Larry Ellison
Jeff Bezos
Mark Zuckerberg
Segery Brin
Larry Page
Michael Dell
Steve Ballmer

This following list is recited from the Forbes 400 Wealthiest People of America list. Would you be so kind and explain to me what exactly is the wrongful policy that made them so unbelievably rich, thus enlarging the disparity in income - and how do you suggest it is rectified?

Oooohhh! Drag forth the Geekish idols! Worship them!

If they, and the rest of the Forbes 400, were worth only half as much, they'd still be beyond wealthy.

What policies? Changes to the tax code that dropped capital gains & dividend tax rates from 28% to 15% over the last 30 years. They likely pay <17% in federal income taxes, which is about the same as a single guy who works for somebody else earning $150K/yr.

The top 1% share of income has more than doubled over the last 30 years, from <9% to ~22% today, while median incomes adjusted for inflation have actually fallen slightly & employment recovery from each successive recession is weaker than the last. Project that trend 30 years into the future, tell me what's left for the rest of America.

Do we really want a third world income distribution curve?

 

[SamurAchzar]

What policies? Changes to the tax code that dropped capital gains & dividend tax rates from 28&#37; to 15% over the last 30 years. They likely pay <17% in federal income taxes, which is about the same as a single guy who works for somebody else earning $150K/yr.

You can raise capital gains tax to 90%, it nearly won't affect their net worth. Their money sits in equity which can not be taxed until liquidated, and they probably liquidate fractions of that. If you tax those fractions, they'll just tone down their lavish lifestyle. Your redistribution won't happen as they will still hold on to their stratospheric net worths while the rest of us struggle.

If they, and the rest of the Forbes 400, were worth only half as much, they'd still be beyond wealthy.

Luckily THEY don't think what you do otherwise they would all step down from their positions, liquidate their equity and let the companies die slowly simply because "they have enough". Imagine that.

These people have CREATED wealth. Without Google the worldwide GDP would have been lower - significantly lower. It's not as if that money would have been split among the poor and the middle class. This money would simply not have existed in the first place. I only selected the tech geeks not because that I think they're nobler than others - for the record I'm sure the much loathed Koch Brothers created wealth as well and are just as beneficial for our GDP as some tech tycoons - it's just that we're all more familiar with their industries. We simply know the story better.

Do we really want a third world income distribution curve?

I oppose the notion of "we", as this is what dragged us to this sorry situation in the first place, where one's property rights is appropriate for discussion by the general public.
But what I want is transparent, flat taxation.

I don't mind the specific percentage, I just want it to be applied to everybody, from the homeless to the billionaire. If the public wants 90% tax, fine by me, but EVERYBODY pays 90% tax. No discrimination, no punishment for one's achievements, and no field tribunals where one's property is deemed excessive and looted by the public.

 

[blackangst1]

nvm

 

[fskimospy]

You can raise capital gains tax to 90%, it nearly won't affect their net worth. Their money sits in equity which can not be taxed until liquidated, and they probably liquidate fractions of that. If you tax those fractions, they'll just tone down their lavish lifestyle. Your redistribution won't happen as they will still hold on to their stratospheric net worths while the rest of us struggle.

This is part of the continuing myth of the untaxable rich/corporation. Changing capital gains taxes won't alter their wealth overnight, but over time it will take a larger bite out of the income of those who derive their incomes primarily from capital gains. Much as increased tax breaks for the extremely wealthy do not correspond to increased spending by the rich, modestly increased taxes on the extremely wealth are unlikely to lead to significant decreases in spending.

I can show you research into the effects of tax breaks on the wealthy and spending, can you show me any research that backs up what you're saying?

Luckily THEY don't think what you do otherwise they would all step down from their positions, liquidate their equity and let the companies die slowly simply because "they have enough". Imagine that.

These people have CREATED wealth. Without Google the worldwide GDP would have been lower - significantly lower. It's not as if that money would have been split among the poor and the middle class. This money would simply not have existed in the first place. I only selected the tech geeks not because that I think they're nobler than others - for the record I'm sure the much loathed Koch Brothers created wealth as well and are just as beneficial for our GDP as some tech tycoons - it's just that we're all more familiar with their industries. We simply know the story better.

That comes from the assumption that these labor factors would only have been employed through Google. Where are you getting this idea?

 

[SamurAchzar]

This is part of the continuing myth of the untaxable rich/corporation. Changing capital gains taxes won't alter their wealth overnight, but over time it will take a larger bite out of the income of those who derive their incomes primarily from capital gains. Much as increased tax breaks for the extremely wealthy do not correspond to increased spending by the rich, modestly increased taxes on the extremely wealth are unlikely to lead to significant decreases in spending.

I can show you research into the effects of tax breaks on the wealthy and spending, can you show me any research that backs up what you're saying?

Tax them 5%, patterns won't change. Tax them extra 30% and you WILL see changes. These people have not achieved what they did by being suckers.

That comes from the assumption that these labor factors would only have been employed through Google. Where are you getting this idea?

The labor doesn't matter, the technology does. The amount of money spent on Labor by Google is completely negligible compared to the productivity gains each of us sees because of Google's products. THIS, my friend, is how wealth gets created.

 

[Jhhnn]

I don't mind the specific percentage, I just want it to be applied to everybody, from the homeless to the billionaire. If the public wants 90&#37; tax, fine by me, but EVERYBODY pays 90% tax. No discrimination, no punishment for one's achievements, and no field tribunals where one's property is deemed excessive and looted by the public.

Always toss in that last bit of hyperbole, huh, that last bit of innuendo? Nobody is calling for the dictatorship of the Proletariat, so your allusions to such are just slurs.

So, uhh, should we apply the flat tax you propose to income, or to assets? Should we banish all other forms of taxation in the process?

Should we perhaps acknowledge concepts like the diminishing marginal utility of money, or the idea that modern wealth exists as something made possible by the underlying platform of society itself, a platform that must be maintained for the structure of wealth to ride atop it? Should we acknowledge that luck plays a part, and that wealth is not infinite, that the frontier closed over 100 years ago?

 

[SamurAchzar]

Always toss in that last bit of hyperbole, huh, that last bit of innuendo? Nobody is calling for the dictatorship of the Proletariat, so your allusions to such are just slurs.

Is this not what being discussed right now - the general public discussing the necessity of a "rich tax"? What is this if not a field tribunal to discuss one's right to his property?

So, uhh, should we apply the flat tax you propose to income, or to assets? Should we banish all other forms of taxation in the process?

Income. Assets can't be taxed other than when they are acquired (sales tax). I'm all for transparency and simplicity so let's consider it "income" in the broader sense - of actual cash going into one's account. Tax everyone. Every last one.

Should we perhaps acknowledge concepts like the diminishing marginal utility of money, or the idea that modern wealth exists as something made possible by the underlying platform of society itself, a platform that must be maintained for the structure of wealth to ride atop it? Should we acknowledge that luck plays a part, and that wealth is not infinite, that the frontier closed over 100 years ago?

"Luck", the often used way of rolling your eyes and blaming some unknown factor for your own personal failure or for other's success. Sorry, but Steve Jobs wasn't lucky when he started Apple, he was not lucky when he created Pixar, he was not lucky when he created NeXT, and he certainly as hell was not lucky when he returned to Apple and took it to be the most valuable company in the world. Look at your iPhone and tell us who's in debt to whom - Steve Jobs to society, or the other way around.

 

[Jhhnn]

Is this not what being discussed right now - the general public discussing the necessity of a "rich tax"? What is this if not a field tribunal to discuss one's right to his property?

That's not what's being discussed at all, but rather the best way to optimize progressive taxation, the basic tenets of which were laid out when income tax was first enacted. In the beginning, income taxes were only paid by the wealthy.

Income. Assets can't be taxed other than when they are acquired (sales tax). I'm all for transparency and simplicity so let's consider it "income" in the broader sense - of actual cash going into one's account. Tax everyone. Every last one.

You haven't addressed the issue of other taxes, most of which are regressive. Not to mention that it's entirely possible to tax assets in a variety of ways, property taxes & inventory taxes being the most notable.

"Luck", the often used way of rolling your eyes and blaming some unknown factor for your own personal failure or for other's success. Sorry, but Steve Jobs wasn't lucky when he started Apple, he was not lucky when he created Pixar, he was not lucky when he created NeXT, and he certainly as hell was not lucky when he returned to Apple and took it to be the most valuable company in the world. Look at your iPhone and tell us who's in debt to whom - Steve Jobs to society, or the other way around.

Luck runs deeper than that, back to the accident of birth. Warren Buffet, for example, acknowledges that his own talents would have been of no use to him had he been born to poor BanglaDeshi parents, and that we're all lucky to be born with whatever particular gifts we have, particularly those of us blessed with greater gifts and greater ability to use them, our place in the structure of our society.

You're really arguing that extremely poor people pay income taxes at all? Why- so that wealthy inheritors can pay less and accumulate even more?

 

[piasabird]

So how does about 80% of the country make less than 0?

 

[fskimospy]

The labor doesn't matter, the technology does. The amount of money spent on Labor by Google is completely negligible compared to the productivity gains each of us sees because of Google's products. THIS, my friend, is how wealth gets created.

The labor creates the technology, which was my whole point. Are you saying these engineers would have been unemployed or unproductive without Google? What are you basing this on?

 

[blackangst1]

That's not what's being discussed at all, but rather the best way to optimize progressive taxation, the basic tenets of which were laid out when income tax was first enacted. In the beginning, income taxes were only paid by the wealthy.

I see you need a history refresher

In 1862, in order to support the Civil War effort, Congress enacted the nation's first income tax law. It was a forerunner of our modern income tax in that it was based on the principles of graduated, or progressive, taxation and of withholding income at the source. During the Civil War, a person earning from $600 to $10,000 per year paid tax at the rate of 3&#37;. Those with incomes of more than $10,000 paid taxes at a higher rate. Additional sales and excise taxes were added, and an &#8220;inheritance&#8221; tax also made its debut.

$600 then is equal to about $13,200 in 2008

Nice revisionist history, Jhhnn. I dont know what happened recently with you. Even though I didnt agree with you on some things, you wrote intelligently and thoughtfully. Now, you're really not much different than Craigfail234 in that you make shit up or twist the truth to push your message.​

​

 

[Jhhnn]

I see you need a history refresher

$600 then is equal to about $13,200 in 2008

Nice revisionist history, Jhhnn. I dont know what happened recently with you. Even though I didnt agree with you on some things, you wrote intelligently and thoughtfully. Now, you're really not much different than Craigfail234 in that you make shit up or twist the truth to push your message.​

​

Epic fail. CPI has nothing to do with what people were actually paid in the Civil War era & beyond. Here's an actual wage survey from 1891-

http://www.dafful.com/maine_wages_study_1891.htm

It's entirely reasonable to think that earnings were a lot less 25 years earlier, although data is scarce.

There was no income tax between 1872 & 1913, near as I can tell, at which point income tax was levied only on those at the top. See the income tax tables & notes-

http://en.wikipedia.org/wiki/Revenue_Act_of_1913

The average salary was ~$600 in 1913., 55 years after the Civil war.

http://lisanostalgia1.tripod.com/10sproducts.html

During the three years before the United States entered the war, the economic boom resulted in an increase in prices. The index of wholesale prices increased almost 24 percent, and consumer prices went up about 11 percent. Hourly wages of manufacturing workers rose from 29 cents in 1913 to 31 cents three years later, and their annual wages went from about $578 to $651, which was very similar to the increase in the prices of consumer goods. Gross farm income grew from about $7.6 billion to $9.5 billion. At least half of this increase, however, was offset by inflation, and the parity ratio of farmprices actually declined from 100 to 94.

http://american-business.org/2812-world-war-i.html

Other relevancies-

http://historicaltextarchive.com/sections.php?action=read&artid=419

The characterization that "in the beginning, income taxes were paid only by the wealthy" seems pretty accurate.