Wisconsin native.
"The true soldier fights not because he hates what is in front of him, but because he loves what is behind him."--GKC
"Liberalism is the modern and morbid habit of always sacrificing the normal to the abnormal" --G K Chesterton
"The only objective of Liberty is Life" --G K Chesterton
"A man can never have too much red wine, too many books, or too much ammunition." -- Rudyard Kipling
Tuesday, July 27, 2010
Umnnhhhh....Maybe GWB Wasn't All That Good
Ugh.
Well, perhaps that explains GWB's desire for Foreign Adventures, eh?
Yeah maybe. And maybe financial deregulation and even more tax cuts for rich people is shitty economic policy as every honest economist in the world has been saying for a decade now. Maybe.
It’s fitting how the decades with highest change in GDP and employment were the 30 years following FDR’s financial reforms and the worst results came once we took a hacksaw to those reforms in the early 80’s and the financialization of our economy took hold. Globalization does not tell the whole tale here as many would like to believe.
Considering that the top 5% of wage earners account for something like 30% of all the economic activity in the US... Doesn't it make sense to let them keep a little bit of their dough and pass it along to their kids?
"...in the 30 years following the end of WWII, during which US industry was the ONLY viable industrial complex in the world..."
Europe's industrial complex was largely rebuilt by 1950. Ever heard of the wirtschaftswunder? To say that the U.S. was the only show in town for 30 years is stretching it by about 2 and a half decades.
Top marginal income tax rates are currently 35%. Rates were over twice that 30 years ago. This doesn't take into account tax avoidance measures taken by this group either which we all know are prominent at this level of income.
We're not talking about grandpa and grandma giving up their fortune when bite the dust. They've already trusted the bulk of it to junior well before Uncle Sam even gets a sniff. And that's fine, but i'm not about to worry about the well-being of their kids. You have to go back to before the Depression to find an era when the top income level has experienced such a favorable tax environment.
Bush may have been a failure, but look at the 80's & 90's. The recently much maligned "neo-liberalism" of Reagan & Thatcher worked.
We'd be fools to repeat the mistakes of the Bush years of course. We'd be just as foolish to give up the gains of the last 30 years by going overboard and greatly increasing state intervention in the economy.
I'm not assaulting the top 5%, nor am I ignoring their contributions to our economy. I'm saying that many Americans believe that the ultra rich are somehow getting a raw deal in this country. A quick look at history reveals otherwise.
There are actually very few of the "ultra rich". Less than 1%.... And most of them could argue they don't even have an income, but live off of their investments, trust funds, etc. If you want to catch them, think Fair Tax, not income tax.
If you take the top 5% of all wage earners, you quickly get to the upper middle class.
What I object to is the class warfare all the time. I don't hate the rich. I want to be the rich. And if I work hard to get there, I shouldn't be punished for that success.
Neo, you're correct. Ritholtz (??) published a chart which showed that the ultra-rich actually DO live off their capgains/dividends--that 'salaries' only accounted for 10-15% of their reported taxable.
And the Fair Tax IS the best way to go. It's perfectly regressive--that is, it hits spending, not income.
Low-income Joe ain't gonna pay much tax on his spending.
"Ritholtz (??) published a chart which showed that the ultra-rich actually DO live off their capgains/dividends--that 'salaries' only accounted for 10-15% of their reported taxable."
Keep in mind that that total has more than doubled in the last 20 years. Less than 1 in 20 derived income from salaries/wages back in the 1970's.
That being said, the top 1% (and 5%) deriving income from dividends and other capital income are still getting a sweet deal. Capital gains taxes have followed the same trajectory as marginal income taxes.
And again, the top 5% (making over $150,000) are not getting a raw deal, historically speaking.
Ugh.
Yeah maybe. And maybe financial deregulation and even more tax cuts for rich people is shitty economic policy as every honest economist in the world has been saying for a decade now. Maybe.
ReplyDeleteIt’s fitting how the decades with highest change in GDP and employment were the 30 years following FDR’s financial reforms and the worst results came once we took a hacksaw to those reforms in the early 80’s and the financialization of our economy took hold. Globalization does not tell the whole tale here as many would like to believe.
We could rephrase that...
ReplyDelete"...in the 30 years following the end of WWII, during which US industry was the ONLY viable industrial complex in the world..."
But yes, the bank "reform" allowing investment/commercial banking confusion was stupid.
Considering that the top 5% of wage earners account for something like 30% of all the economic activity in the US... Doesn't it make sense to let them keep a little bit of their dough and pass it along to their kids?
ReplyDelete"...in the 30 years following the end of WWII, during which US industry was the ONLY viable industrial complex in the world..."
ReplyDeleteEurope's industrial complex was largely rebuilt by 1950. Ever heard of the wirtschaftswunder? To say that the U.S. was the only show in town for 30 years is stretching it by about 2 and a half decades.
Top marginal income tax rates are currently 35%. Rates were over twice that 30 years ago. This doesn't take into account tax avoidance measures taken by this group either which we all know are prominent at this level of income.
We're not talking about grandpa and grandma giving up their fortune when bite the dust. They've already trusted the bulk of it to junior well before Uncle Sam even gets a sniff. And that's fine, but i'm not about to worry about the well-being of their kids. You have to go back to before the Depression to find an era when the top income level has experienced such a favorable tax environment.
Yup - just DAMN those people being successful.. We'd better show them.
ReplyDeleteI mean, paying taxes is patriotic. Joe Biden said so. Just ask John Kerry.
Struppster,
ReplyDeleteDon't get distracted by income inequality.
Bush may have been a failure, but look at the 80's & 90's. The recently much maligned "neo-liberalism" of Reagan & Thatcher worked.
We'd be fools to repeat the mistakes of the Bush years of course. We'd be just as foolish to give up the gains of the last 30 years by going overboard and greatly increasing state intervention in the economy.
Believe it or not, I would agree that the answer is somewhere in between Jeremy.
ReplyDeleteYou completely missed my point neo.
ReplyDeleteI'm not assaulting the top 5%, nor am I ignoring their contributions to our economy. I'm saying that many Americans believe that the ultra rich are somehow getting a raw deal in this country. A quick look at history reveals otherwise.
There are actually very few of the "ultra rich". Less than 1%.... And most of them could argue they don't even have an income, but live off of their investments, trust funds, etc. If you want to catch them, think Fair Tax, not income tax.
ReplyDeleteIf you take the top 5% of all wage earners, you quickly get to the upper middle class.
What I object to is the class warfare all the time. I don't hate the rich. I want to be the rich. And if I work hard to get there, I shouldn't be punished for that success.
Neo, you're correct. Ritholtz (??) published a chart which showed that the ultra-rich actually DO live off their capgains/dividends--that 'salaries' only accounted for 10-15% of their reported taxable.
ReplyDeleteAnd the Fair Tax IS the best way to go. It's perfectly regressive--that is, it hits spending, not income.
Low-income Joe ain't gonna pay much tax on his spending.
"Ritholtz (??) published a chart which showed that the ultra-rich actually DO live off their capgains/dividends--that 'salaries' only accounted for 10-15% of their reported taxable."
ReplyDeleteKeep in mind that that total has more than doubled in the last 20 years. Less than 1 in 20 derived income from salaries/wages back in the 1970's.
That being said, the top 1% (and 5%) deriving income from dividends and other capital income are still getting a sweet deal. Capital gains taxes have followed the same trajectory as marginal income taxes.
And again, the top 5% (making over $150,000) are not getting a raw deal, historically speaking.
Ummm.... $150K ain't rich. Its not destitute. It may be comfortable even. But it ain't rich.
ReplyDelete