U.S. Economy Is Increasingly Tied to the Rich

[Toastedlightly]

Too progressive, are you kidding me ?

Warren Buffett has had a standing bet for years now. If anyone on the Forbes 400 can prove that they pay a higher tax rate than his secretary, he will give them $1 million. Noone has ever been able to do so.

Its not about actual rate, but about actual money paid.

http://www.american.com/graphics/2007/november/Guess Who Really Pays the Taxes.jpg

The rich are presumably paying for the same services as the less fortunate and yet they pay a disproportionately larger amount of taxes.

 

[Red Dawn]

Its not about actual rate, but about actual money paid.

http://www.american.com/graphics/2007/november/Guess Who Really Pays the Taxes.jpg

The rich are presumably paying for the same services as the less fortunate and yet they pay a disproportionately larger amount of taxes.

And it doesn't seem to hurt their bottom line at all. In fact they are getting wealthier.

 

[khon]

The rich are presumably paying for the same services as the less fortunate and yet they pay a disproportionately larger amount of taxes.

That's an incorrect assumption.

More wealth not only requires more protection, it also requires a larger infrastructure.

 

[ayabe]

Focusing on percentages instead of dollars is the only way to do it and is inherently more equal. Everyone pays the same sales tax, how much are you bitching that the tax you have to pay on a car is *shock* much higher than what you have to pay for a t-shirt?

The transaction has a higher base value it's not any more complicated than that. Are you going to argue that you should have to pay a lower sales tax than people with less expensive transactions on the basis that the dollar amount you're hit with is "punitive"?

That's crap.

 

[Acanthus]

You do realize that people move in and out of the classes right? Someone that was lower middle class five years ago, may very well be upper class today, or vise versa. People's places in the class structure isn't static.

You are talking about economic mobility.

it is a measured statistic, and those statistics arent so good in the united states.

 

[brencat]

Quote:
Sometimes I hate being right most the time because I then lose track of time. Eventually, may take years, the masses catch up to me like now.

Welcome to my world 8 years ago folks.

Yeah, and even a stopped clock is right twice per day...

 

[StageLeft]

I told you guys this 8 years ago.

How come took so long for it to sink in?

Because nobody takes you seriously.

Sometimes I hate being right most the time because I then lose track of time. Eventually, may take years, the masses catch up to me like now.

Welcome to my world 8 years ago folks.

I am not the only one amazed that you, with your uncanny ability to see the future, are still virtually destitute yourself. By now you should be rich as heck, having invested with your incredible prescience in markets at the correct time. In your head you truly do think that you have this all figured out and yet when you take stock of your life it's a tattered mess. What a masterful deception you play on your self to somehow reconcile these two alternate realities.

 

[dmcowen674]

Because nobody takes you seriously.I am not the only one amazed that you, with your uncanny ability to see the future, are still virtually destitute yourself. By now you should be rich as heck, having invested with your incredible prescience in markets at the correct time. In your head you truly do think that you have this all figured out and yet when you take stock of your life it's a tattered mess. What a masterful deception you play on your self to somehow reconcile these two alternate realities.

You don't know how much money has been stolen from me over the years.

As evidenced in here there are good people and bad people, with me the bad usually win.

 

[IndyColtsFan]

You don't know how much money has been stolen from me over the years.

As evidenced in here there are good people and bad people, with me the bad usually win.

LOL, sure Dave, sure. Now go take your signed forms and pick up some vinegar at the nearest store.

 

[spidey07]

I still love the class warfare against "the rich". I SAY AGAIN!

The top 5 percent have an AGI of 160K and are dual income families. That is two white collar professionals even at a 5-10 years experience or less in any medium size city.

That is NOT RICH. Stop the jealousy and work on your career.

 

[Jhhnn]

In all fairness, I don't think Dave ever really wanted to be rich. Neither do I. Yeh, sure, it'd be nice and all, but I've seen too many people consumed by the effort and desire, end up miserable.

If we look at some real numbers, what we see is that income has shifter radically to the top over the last 30 years. See chart 5, here-

http://www.taxfoundation.org/news/show/250.html

So, of course the economy is more dependent on spending by people at the top. The problem with that is that incomes at the tippy-top aren't spent at all, but rather re-invested. It actually reduces cashflow through the broader economy. People who take home tens or hundreds of millions per year are beyond the point of saturation wrt personal spending.

In 2007, the top .1 percent share of income is only slightly less than that of the entire bottom 50 percent combined. The top 5 percent share is 3X that of the bottom 50 percent combined.

While Spidey is correct about the income required to be in the top 5 percent, he pointedly ignores the effect of the top 1 percent having basically twice the total income of the bottom 50 percent combined.

Basically, the gains of the last 30 years have gone largely to the top 1 percent, and if recent data is extrapolated backwards, overwhelmingly to the top .1 percent.

Let's face it, anybody who makes $2M in a single year is rich by middle class standards, even if it's their best year ever, even if they only make a tenth of that any other year. $2M is more money than the median worker will earn in a lifetime.

 

[spidey07]

And you still neglect my point and revert to the top in your class warfare.

Fuck you communist. Fuck you. This is America.

 

[jackace]

And you still neglect my point and revert to the top in your class warfare.

Fuck you communist. Fuck you. This is America.

No one is neglecting your point, your point is irrelevant to the discussion. We are discussing how spending by the top 5% is having an ever increasing impact on our economy while the other 95% is seeing their impact on the economy shrink. Where that 5% line is drawn really doesn't matter. It could be $30k a year and the discussion would be the same.

 

[Jhhnn]

And you still neglect my point and revert to the top in your class warfare.

Fuck you communist. Fuck you. This is America.

The point, Spidey, is that you have no point, and have been reduced to extremely lame and desperate ad homs. If this were a race to the bottom, you'd win pulling away.

 

[Acanthus]

I still love the class warfare against "the rich". I SAY AGAIN!

The top 5 percent have an AGI of 160K and are dual income families. That is two white collar professionals even at a 5-10 years experience or less in any medium size city.

That is NOT RICH. Stop the jealousy and work on your career.

The top 5% of individuals =/= the top 5% of families.

The family statistic is a bad one because it hides the fact that wages have been flat for the bottom 3 quartiles for 30 years straight.

 

[spidey07]

The top 5% of individuals =/= the top 5% of families.

The family statistic is a bad one because it hides the fact that wages have been flat for the bottom 3 quartiles for 30 years straight.

The top 5% concerns top 5% tax returns. This includes individual and married.

It ain't rich.

 

[StageLeft]

Basically, the gains of the last 30 years have gone largely to the top 1 percent, and if recent data is extrapolated backwards, overwhelmingly to the top .1 percent.

This is true and responding to such stats with "just work on your career" or "pull your bootstraps up and stop bitching" are lazy.

The country's economy is being increasingly targeted toward enriching further those already rich.

 

[hal2kilo]

That's an incorrect assumption.

More wealth not only requires more protection, it also requires a larger infrastructure.

Yes, they directly benefit the most from the commons. Commons being defense of the country for one, physical infrastructure, and legal infrastructure.

 

[Fern]

This is true and responding to such stats with "just work on your career" or "pull your bootstraps up and stop bitching" are lazy.

The country's economy is being increasingly targeted toward enriching further those already rich.

You, and this discussion and others of this type, are assuming it's always the same people year-to-year in these top tiers.

I've never seen any evidence of this.

While no doubt some remain there for years (e.g., Warren Buffet), it's obvious that many others do not. Builders and real estate developers are an example of some who are now bankrupt/out-of-bussiness but were making huge profits just a few years ago.

Celebrities, pro athletes, musicians are another group who move in and out of the top tier.

Lottery winners and gamblers.

During the .com days we had an awful lot of people move into and out of those top tiers real quick.

Many average people will appear in one these top tiers for one year in their lives. I've seen people at retirement age screw-up their 401k roll-over and have to report (for taxes) a huge amount of income. I've seen shady stock brokers dump retirees life long retirement assets so they get a big commision, this generates huge taxable gains.

There are an awful lot of ways more-or-less average people can briefly appear in one of these top tiers.

I once read somewhere that the average millionaire goes bankrupt 7 times in their lives; I've seen a couple of people like that.

Unless and until it can be demonstrated that all these top tier people remain the same year after year, all these stats say is "Look! Some people in the USA made a lot of money that year!" So what? This is the USA; that's supposed to happen.

Fern

 

[dmcowen674]

You, and this discussion and others of this type, are assuming it's always the same people year-to-year in these top tiers.

What in the hell are you calling top tier? $100,000 ???

 

[StageLeft]

You, and this discussion and others of this type, are assuming it's always the same people year-to-year in these top tiers.

Does it really matter? Anyway, we know that class mobility is fairly limited as a whole anyway, but whether it's the same group of people or not is almost irrelevant; in either case we have a tiny, miniscule fraction of the population with a massive percentage of the wealth. Even if it's a revolving door it's still a situation the vast majority of Americans will never experience.

 

[xj0hnx]

Even if it's a revolving door it's still a situation the vast majority of Americans will never experience.[b/]

So what? Oh my god, you're never going to be a top earner, or have something that someone else has, let me get out my violin. Class envy is an ugly thing.

 

[StageLeft]

So what? Oh my god, you're never going to be a top earner, or have something that someone else has, let me get out my violin. Class envy is an ugly thing.

If you can't join the thread with anything but talking points please refrain from pressing submit.

 

[Fern]

Does it really matter? Anyway, we know that class mobility is fairly limited as a whole anyway, but whether it's the same group of people or not is almost irrelevant; in either case we have a tiny, miniscule fraction of the population with a massive percentage of the wealth. Even if it's a revolving door it's still a situation the vast majority of Americans will never experience.

It's totally relevent.

What's the damn problem if once in a while somebody in the US makes good money?

If the top 5 percent were to change every year, in 10 years time 50 percent of the people would have been up there.

I see the problem if it's ALWAYS only the same people, but there's no evidence of that.

--------------
And you're badly mixing up the meaning of these stats. Taxable income != wealth.

You can be very wealthy and have a low taxable income. You can have a pretty high taxable income and fairly unimpressive wealth (or even negative).

I'm working on a person's case right now who made about $500k a year for many years but is now bankrupt - their business folded due to the ecomony, lost money in the stock market, blew through all their retirement savings trying to keep the bussiness afloat and their employees working in hopes the economy would turn around, their big home is underwater and has been forclosed on etc. Looking at these stats the way you do you would think that they are wealthy; yet it's the opposite.

Some countries actually have a 'wealth tax' and they fill out forms reporting what they own vs their debt. We don't have that here in the US, consequently we don't have any stats on "wealth".

And in general I disagree with your assertion that "the vast majority of Americans will never experience" a year in a top tier. But even if more-or-less true, what's the problem? Many strive to be rich, some make it and some don't.

Perpetual poverty should be the focus, not those occasisonally making some good money. IMO, you people are looking at the wrong end of the scale. How to break any perpetual cycle of poverty for some of permanent underclass group should be the concern. and you're not gonna solve that by eliminating the possibility of a 'big year' for everybody else.

Fern

 

[StageLeft]

What's the damn problem if once in a while somebody in the US makes good money?

The problem is that in a society of finite resources, one's riches come at the expense of another's. It is obviously not 1:1 and resources change, and they may drag the other up to an extent (so-called trickle down), but when a few at the top gain in wealth at an exponential rate while a far, far more numerous number of people do not change their wealth, I think we see a problem.